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Written by: Ruth Stevenson, Director/Conveyancer at Ives & Co Solicitors
Completion day is the day a property transaction is finalised. For a purchaser, it is normally the day the purchase money is transferred to the vendor’s solicitor, the purchase completes and the keys to the new property are released. For a vendor, it is the day they must normally vacate the property and the sale proceeds are received by their solicitor.
On completion day, your solicitor handles the transfer of the purchase money and confirms when completion has taken place. You should not collect the keys or assume that you can move into the property until your solicitor or estate agent confirms that completion has occurred.
Although completion day is exciting, there are several legal and financial steps taking place behind the scenes before the keys can be handed over.
Table of Contents
- Completion day at a glance
- What is completion?
- What happens before completion day?
- What happens on completion day for a purchaser?
- What happens on completion day for a vendor?
- How does completion work in a property chain?
- What time does completion happen?
- When can the purchaser collect the keys?
- What can delay completion?
- What happens to the vendor’s mortgage?
- What happens after completion?
- What should you do on completion day?
- Frequently asked questions
- Speak to a conveyancer
Completion Day: At a Glance
A typical completion day involves the following:
- The purchaser’s solicitor has the funds required to complete.
- The completion money is transferred to the vendor’s solicitor.
- The vendor’s solicitor receives the funds and confirms completion.
- The estate agent or other key holder is authorised to release the keys.
- The purchaser can take possession of the property.
- The vendor’s solicitor deals with the vendor’s mortgage and other payments where applicable.
- The solicitors deal with the remaining post-completion formalities.
The precise timing will vary between transactions. If you are part of a property chain, completion of your transaction may also depend on funds moving through other transactions in the chain.
What Is Completion?
Completion is the final stage of the property transaction itself.
By this point, contracts will normally already have been exchanged and the parties will be legally committed to completing on the agreed date.
On completion, the balance of the purchase price is transferred to the vendor’s solicitor. Once the funds have been received and completion has been confirmed, the purchaser becomes entitled to take possession of the property and the keys can normally be released.
Exchange and completion are therefore different. Exchange creates the legally binding commitment to proceed, while completion is when the transaction is actually finalised.
What Happens Before Completion Day?
Your solicitor will carry out a number of important tasks in preparation for completion.
For a purchaser, these may include:
- Carrying out final pre-completion searches
- Preparing a completion statement
- Requesting any remaining money required from you
- Requesting mortgage funds from your lender, where applicable
- Checking that the necessary legal documentation is ready
- Confirming the arrangements for completion with the vendor’s solicitor
If your solicitor asks you to transfer money before completion, make sure you do so within the timeframe requested.
Large property transactions are also a target for fraud. Never transfer money using bank details contained in an unexpected or suspicious email. Follow your solicitor’s instructions for verifying their bank details before sending funds.
For vendors, the solicitor will usually obtain an up-to-date figure for repayment of any mortgage secured against the property and prepare the financial statement showing the anticipated sale proceeds and deductions.
What Happens on Completion Day for a Purchaser?
For a purchaser, much of completion day involves waiting while the solicitors and banks deal with the financial side of the transaction.
Your solicitor will send the required completion money to the vendor’s solicitor.
The amount being transferred may include funds from several sources, such as:
- Your mortgage lender
- Your own funds
- Money received from the sale of your existing property, if you are in a chain
Once the vendor’s solicitor receives the required funds, they will confirm that completion has taken place.
The estate agent, vendor or other person holding the keys can then normally be authorised to release them to you.
Until that confirmation is received, do not assume that the property is available for you to enter, even though it is the agreed completion date.
What Happens on Completion Day for a Vendor?
If you are selling, you should be ready to leave the property in accordance with the terms of the contract.
This usually means removing your belongings, leaving behind any fixtures and fittings that were agreed as part of the sale and handing over all available keys.
It is sensible to complete your packing and cleaning as much as possible before completion day rather than leaving everything until the final morning.
Once the purchaser’s completion funds have reached your solicitor, completion can be confirmed.
Your solicitor will then deal with the relevant financial matters, which may include:
- Repaying your existing mortgage
- Paying the estate agent’s account where authorised
- Deducting legal fees and other agreed expenses
- Accounting for any relevant service charge or other adjustments
- Sending the remaining net sale proceeds to you
If you are also purchasing another property, some or all of the proceeds may instead be used towards that purchase.
How Does Completion Work in a Property Chain?
Completion can be more complicated when several transactions are connected in a property chain.
For example, you may need the money from your sale to complete your onward purchase. The person purchasing your property may also be relying on funds from their own sale.
As a result, money can move through several solicitors’ client accounts during completion day.
A transaction towards the top of the chain may therefore be waiting for completion funds to work their way through from transactions lower down the chain.
This is one reason why completion does not necessarily happen at the same time for everyone involved.
A delay earlier in the chain can affect transactions further along it without necessarily indicating that anything has gone wrong.
What Time Does Completion Happen?
There is no guaranteed time for completion.
Many people expect completion to happen first thing in the morning, but this is not necessarily the case.
Completion depends on the necessary funds reaching the vendor’s solicitor. Bank processing times, mortgage funds and the number of transactions in a chain can all affect when this happens.
Completion often takes place around late morning or lunchtime, but it can happen earlier or later.
If you have removals booked, make sure you understand that there can be a period during which your belongings are packed and ready but you are still waiting for confirmation that you can access the new property.
When Can the Purchaser Collect the Keys?
The purchaser can normally collect the keys after completion has been confirmed.
Once the vendor’s solicitor has received the completion funds, they will confirm completion and authorise the release of the keys.
The keys are commonly held by the estate agent, although arrangements can vary.
Your solicitor or estate agent should tell you when the keys are available.
Avoid arriving at the estate agent first thing in the morning expecting to collect them. The agent cannot normally release the keys simply because it is completion day; they must wait for the appropriate authority.
What Can Delay Completion?
A delay on completion day can be frustrating, but it does not necessarily mean that there is a serious problem.
Common reasons for delays can include:
Bank Transfers
Completion funds need to move between bank accounts. Transfers may take time to process, particularly where several transactions are involved. Please note that banking errors can also happen; there have been cases in the last 12 months where banks as a whole have had an issue. If this happens, this is beyond your solicitor’s control, but your solicitor and the bank will do all they can to assist. This is very rare but could happen.
Mortgage Funds
Where a purchaser is using a mortgage, their solicitor needs to have received the lender’s funds before they can complete. Your solicitor will order your mortgage funds the day before legal completion to ensure that this issue doesn’t happen.
Property Chains
A solicitor may be waiting to receive money from a client’s sale before those funds can be sent onwards for their purchase.
Last-Minute Issues
Occasionally, an unexpected legal, financial or administrative issue needs to be resolved before the funds can be transferred or completion confirmed.
If there is a delay, remain in contact with your solicitor and wait for confirmation rather than relying on assumptions about when the keys should be available.
What Happens to the Vendor’s Mortgage?
If the vendor has a mortgage secured against the property, it will need to be repaid as part of the completion process.
Before completion, the vendor’s solicitor will obtain a redemption figure from the lender showing how much is required to repay the mortgage.
Following completion, the solicitor uses the sale proceeds to repay the lender and deals with the steps necessary for the lender’s charge to be removed from the property’s title.
The remaining sale proceeds, after any other authorised payments and deductions, can then be dealt with in accordance with the vendor’s instructions.
What Happens After Completion?
For the purchaser, receiving the keys does not mean that the legal work has completely finished.
Your solicitor will still need to deal with the relevant post-completion requirements.
In England, this will normally include dealing with any Stamp Duty Land Tax requirements and registering the purchaser’s ownership with HM Land Registry.
In Wales, Land Transaction Tax (LTT) applies instead of Stamp Duty Land Tax. Your solicitor will deal with the relevant LTT requirements and registration of the purchaser’s ownership with HM Land Registry.
If the purchase involves a mortgage, the lender’s charge will also normally be registered.
HM Land Registry registration does not need to be completed before you can move into the property. The registration process takes place after completion and can take considerably longer than the completion process itself. If you do need, for any reason, the property to be registered more quickly (i.e. for a sale or remortgage), please notify your solicitor, and they can apply to the Land Registry to expedite the process.
What Should You Do on Completion Day?
If you are a purchaser, keep your phone available so your solicitor or estate agent can contact you. Do not travel to collect the keys until you have been told that completion has taken place.
If you are a vendor, make sure the property is vacated in accordance with the contract and that you have removed everything that is not included in the sale. Leave all agreed fixtures and fittings in place and make the necessary arrangements for the keys.
Both purchasers and vendors should consider practical matters such as:
- Taking meter readings
- Photographing meter readings for your records
- Notifying utility providers
- Updating Council Tax arrangements
- Updating insurance providers
- Redirecting post where necessary
- Keeping important property documents safely
Purchasers should also check that their buildings and contents insurance arrangements are appropriate from the relevant date.
Most importantly, keep in contact with your solicitor and wait for their confirmation that completion has taken place.
Frequently Asked Questions
What actually happens on completion day?
On completion day, the purchaser’s solicitor transfers the completion money to the vendor’s solicitor. Once the funds are received, completion is confirmed and the purchaser can normally collect the keys and take possession of the property.
What time will I get the keys on completion day?
There is no guaranteed time. Keys can normally be released once the vendor’s solicitor has received the completion funds and authorised their release. This is often around late morning or lunchtime but may be earlier or later. The contract usually stipulates 1 pm or 2 pm as standard (your solicitor will confirm), but this is the time you should aim to be out of your property by when selling. If you are struggling with vacating the property, please speak to your solicitor as early as possible on the day.
Do I need to contact my solicitor on completion day?
Your solicitor should keep you informed and confirm when completion has taken place. Keep your phone available in case they need to contact you, but bear in mind that they may be dealing with bank transfers and other completion work during the morning.
Can I move into the property before the money arrives?
Normally, you should not take possession until completion has been confirmed unless a specific alternative arrangement has been agreed and properly documented.
Does the vendor have to move out before completion?
The vendor will give vacant possession by the time required under the contract. They should therefore plan their move carefully and ensure the property is ready for handover.
What happens if completion is delayed by a few hours?
Short delays can occur because of bank transfers, mortgage funds or a property chain. A delay during the day does not necessarily mean that the transaction will fail to complete.
What happens if completion does not take place on the agreed day?
Failure to complete on the contractual completion date is potentially serious because the parties are already legally bound following exchange. The contract provides mechanisms and potential consequences for delayed completion. If this occurs, your solicitor will advise you on the contractual position and the steps that need to be taken.
Can exchange and completion happen on the same day?
Yes. Exchange and completion can take place on the same day. However, this gives the parties less certainty in advance because they are not contractually committed until exchange actually takes place.
When do I legally own the property?
In a standard residential purchase, completion is the point at which the purchase completes and the purchaser becomes entitled to the property. The purchaser’s ownership is then registered at HM Land Registry as part of the post-completion process.
What happens after I collect the keys?
You can normally move into the property once completion has been confirmed. Your solicitor will continue dealing with post-completion matters, including the relevant property tax requirements and registration at HM Land Registry.
Speak to a Conveyancer
Completion day is an exciting milestone, but there is a considerable amount of legal and financial work taking place behind the scenes. Your solicitor will coordinate the completion process, transfer or receive the necessary funds and let you know when the transaction has successfully completed.
If you are purchasing or selling a property in England or Wales, please contact one of our offices or email quotes@ivesandco.com so that we can provide you with a quotation, or call us to discuss how we can assist.
Our conveyancing team will be happy to discuss your transaction and guide you through the next steps.
