December 21, 2018
The day of completion is a pre-arranged date on which the financial and legal formalities are concluded and the ownership of the property is transferred from the seller to the buyer.
On the day of completion, the buyer’s solicitor will send the seller’s solicitor the balance of the purchase price. The seller’s solicitor will then inform the seller and their estate agent that the property must be vacated and that the keys can be released to the buyer.
Below we answer some of the common questions on completion day.
What time am I likely to complete on completion day?
Completion can take place at any time on completion day, but is most commonly around midday. It can be as early as 10:00 am but this is usually where a property is already vacant and there’s no property chain.
The latest that a completion will usually take place is 3:30 pm, however, in certain circumstances it can be as late as 5:00 pm.
The exact time of completion is often dictated by the banking system. Your solicitor will notify you once monies have been received and once completion has formally taken place.
What will your solicitor do on completion day?
The date of completion will have been previously agreed on between the buyer, seller, and their respective solicitors. For the buyer to become the new registered owner of the property, the transfer deed and documents must be signed by the seller. This is usually done prior to completion day, in readiness.
The buyer’s solicitor will settle any outstanding bills or invoices from their client’s funds. The buyer will have been issued a completion statement prior to completion day explaining any additional funds that may have been needed to ensure enough money is available.
If the buyer is using a mortgage to fund the property purchase, their solicitor will not be able to complete until the funds are received from the lender. The lender can sometimes send the money before the day of completion but more often, it will happen on the morning of completion.
The buyer’s solicitor will then transfer the agreed purchase price to the seller’s solicitor. They will also complete and submit a transfer form to the Land Registry which will change the ownership information.
The seller’s solicitor, upon receiving the funds from the buyer’s solicitor, will also settle any outstanding bills and invoices such as estate agent fees and their own legal fees. They will then either transfer the remaining balance to the seller or if the seller is purchasing on, they will repeat the process in the capacity of their client now being the buyer. This is known as a chain.
Funds are transferred using the CHAPS banking system. For more information on CHAPS, visit the Bank of England website.
How will a property chain affect completion day?
A ‘property chain’ refers to multiple property transactions being linked together in a chain, with each one being dependant on the transaction before it.
A long chain can have an impact on the timings of completion dependent upon how far along the chain your sale and/or purchase is.
The chain will start with someone only buying a property on completion day and end on someone only selling on completion day. As money is transferred and the first property transaction completed, money is effectively passed down the chain allowing each transaction to complete in turn until reaching the final seller.
A typical chain will be made up of anywhere between 3 and 6 transactions, but can occasionally be more.
What does your lender do to enable completion?
If you are borrowing money from a mortgage lender to fund your property purchase, they will complete some final checks before releasing the money to your solicitor. Your solicitor will need to send them a Certificate of Title. A Certificate of Title is a document that gives a detailed history of the homes’ ownership, including a complete legal description of the property.
Your lender will also do one last credit check against the borrowers in order to ensure that their circumstances have not changed since the initial mortgage offer. If they find anything that may have an impact on the borrower’s ability to afford the mortgage, they can withdraw the offer.
Once the final checks are complete, the lender will transfer the mortgage money to the buyer’s solicitor.
Vacating the property on completion day
The seller of the property will need to have cleared out and vacated the property by the time of completion. As a seller, you should aim to have moved all of your belongings out of the property by 12 pm on the day of completion.
Once the property is clear, the seller will usually drop off the keys to their estate agent from where the buyer will be able to collect them once notified by their solicitor. It can be useful to have already dropped off a spare set of keys to the estate agent to ensure you are not having to rush. The second set of keys can then be pushed through the letterbox when leaving the property.
Remember to take readings from any electricity or gas meters before leaving.
What can go wrong on completion day?
There are a number of things that could delay or cause an issue on completion day. Completion could be delayed as money is transferred from lender to solicitor and from one solicitor to another along the chain. Money can take anything between 20 minutes and several hours to show in the recipient solicitors’ bank account.
Another issue can be having insufficient funds to settle all outstanding bills and fees owed, including the stamp duty if applicable. Your solicitor will issue a completion statement prior to completion day and it is important any additional money or deposit is transferred to your solicitor ahead of completion day.
Delays can also often occur while a seller is busy trying to vacate the property. Confirm with your removal company what time they will arrive and don’t underestimate how long it will take to move your belongings out. Do as much of the packing as possible prior to completion day.
Summary of completion day
Completion day can be understandably stressful trying to stay organised and on top of everything. Your solicitor will take care of the formalities on the day but don’t worry if you don’t hear from them first thing in the morning, this is perfectly normal as completions will take place throughout the day.
Ensure you are on top of the moving process by getting as much done as possible ahead of completion day. Remember to pack your kettle last, enjoy a cup of tea and you’ll be in your new home before you know it!
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