Perhaps you’ve finally exchanged contracts and now have a short period before completion day. Or maybe you’ve not yet exchanged contracts but you’re about to do so. So perhaps then you are wondering whether you have to move out on the day of completion.
So do you have to move on completion day? You have to move on completion day once the final monies have changed between solicitors, as the house no longer belongs to you. There are exceptions to this where for example the buyer allows you to remain in the house for a pre-agreed time period. But this is rare and only happens in exceptional circumstances.
You now know you have to move on completion day, but what if you’re not ready to move? Also, what else happens on the day of completion? Let’s begin by looking at what happens on completion day in a chain.
What happens on completion day in a chain?
On completion day if you’re in a chain there’s a simultaneous transfer of completion monies between all solicitors involved and the ownership title for each house in the chain changes hands between the seller and the buyer.
Each solicitor will inform each seller and their estate agent that the property must be vacated. It is at this point you must move out. Your buyers will be on their way with a removal van in tow to move into your house.
What are completion monies and how is this calculated?
Completion monies relates to the balance of the purchase price, which is usually 90% of the purchase price. This is on the assumption that a 10% deposit was paid when contracts were exchanged.
Your solicitor is responsible for calculating this amount and in order to facilitate this payment they will send you a completion statement. A completion statement is a summary of monies due to be paid and received.
What a completion statement will look like and what it includes:
|Monies Due In||Monies Due Out|
|Advance of funds from the buyer to solicitor to cover for the cost of searches|
|Funds from lender or mortgage company which are applied for by your solicitor between exchange and completion and are normally received on completion day|
|Deposit due to seller which is usually 10% and is paid on the day of exchange|
|Balance of the purchase price due to seller which is usually 90% and is paid on completion day|
|Estate agents commission paid on completion day|
|Solicitors fees paid on completion day|
|Search fees paid during the conveyancing process before exchange|
|Stamp Duty (SDLT) paid to HMRC within 14 days of completion day|
|Deposit From Buyer which is usually the balancing amount and must be paid before completion day|
If you are borrowing on a mortgage to purchase the house it is the mortgage or funds from the lender that will likely make up most of the completion monies.
However, the balance on the completion statement is what you as the buyer must pay to your solicitor in advance of completion day. Make sure you pay these funds so your solicitor has cleared funds on the day of completion. Otherwise completion cannot happen and you will be in default.
What do you need to do to prepare for completion day?
First and foremost in preparation for the day of completion includes to make sure your solicitor has the funds to execute the completion. But also you need to have arranged for the removal of your belongings and furniture.
To make sure your solicitor has the funds needed to complete, if you intend to borrow you need to make sure your mortgage is in place. However, you solicitor will not advise that you exchange contracts before your mortgage is in place. You then need to make sure you have the balance of the completion monies too.
Here’s a completion day checklist
- Put the date and time of completion in your diary. Also put this on a large piece of paper in big type on your fridge door!
- Book your removal company or hire a van if you’re moving yourself.
- Start packing on the day contracts are exchanged. Make sure your belongings are in boxes before your removal company arrives on completion day.
- Dismantle any large items of furniture or otherwise to make things easy for your removal company.
- Pay your solicitor the balance monies before the day of completion as per the completion statement. These must be cleared funds for your solicitor on completion day.
- Notify the utility companies of the completion day.
- Read the meters, which includes electricity, gas and water meters.
- Put in place a mail redirection at the Post Office unless you have notified everyone of your new address. But it’s still worthwhile having a mail redirection just in case you’ve missed someone.
- Drop your keys off at the estate agents.
What happens if you’re not ready to move on completion day?
If you are not ready to move on the day of completion you will be in breach of contract. The contract that was exchanged on the day of exchange will include a pre-agreed date and time for completion day. It is therefore extremely important you abide by this day and time.
You will disrupt your buyer if you don’t move on completion day. Usually under standard conditions of sale contracts the latest time a seller should vacate a property is 2pm.
This time can be changed by mutual agreement between the seller and the buyer. However, if there’s a sales chain this time needs to be agree to by everyone in the chain.
What happens if the seller has not moved out on completion day?
If the seller has not moved out on completion day or has not moved out by the agreed time in the contract you need to speak with your solicitor. In this case the seller is in breach of contract. However, if your seller is slightly delayed in moving out by an hour or so you may simply need to wait.
What are the consequences of not moving on completion day?
The consequences of not moving on completion day include disruption to the buyers and their removal company. But the person who does not move out at the agreed time is potential liable to interest charges and damages.
The damages could include the following costs:
- Additional charges by the removal company. Removal firms usually have a set time to move your belongings and furniture. If this time limit is exceeded they will normally charge you for the delays. If your removal company arrives at the house and the seller hasn’t moved out they won’t be able to move your belongings in. This will mean your stuff will have to remain in their lorries until the seller moves out. In the worst case scenario the lorries will have to return to their depot and off-load your things.
- Storage charges by the removal firm. Most removal companies will have other removals already arranged. If they are not able to off load your belongings and furniture in time for their next removal job, they will have to off load this to a storage facility. This storage facility will be charged to you.
- Additional legal fees to your solicitor. If your solicitor has to get involved with the seller’s solicitor to get them to move out this will be charged in addition to the conveyancing fees.
- Hotel costs. If you cannot move into your new home you will have to sleep somewhere. At this stage your own house is sold and your buyers will have moved in. Your only option is to stay in a hotel unless you have family or friends nearby.
Whilst this does happen in some cases where the vendor doesn’t move out in time, it doesn’t happen too often. What can happen is there’s a slight delay where you’ll turn up at the house and the seller is finishing up moving their things. In this case simply wait for them to finally move out. Your removal company will not usually charge unless they go past 6pm.
Should you contact your solicitor if the sellers haven’t moved out?
However, if your sellers have not moved out by around 4-4;30pm you might want to inform your solicitor. If you are still there after this time or past when your solicitors are closed you won’t be able to contact them. But if you make contact before they close at least your solicitor will be able to relay the problem to the seller’s solicitor to get them to move quicker.
Can you move out before completion day or earlier than the pre-agreed time in the contract?
You can move out before completion day if you already have somewhere to go. In fact it’s recommend to sell your house and move into rented before buying again, which will allow you to do this. Alternatively, if you’ve already completed on a new house you can move into this before completion day on your house.
However, if you move earlier than the time included in the contract you may have to wait for the sellers to move. The sellers are not obliged to move out until the time in the sales contract.
You may like to take a quick read of this article on selling your house and renting before buying again. But in particular I have listed 15 advantages of selling your house and renting before buying again.
Can you begin to move in if the seller hasn’t move out?
You may arrive at your new house and the seller hasn’t yet move out by the agreed time. If this is the case I wouldn’t suggest you move your belongings in, unless you agree this with the vendor.
If you begin to move your things into your new house without agreement with the vendor you may get into a conflict. You are best to avoid any conflict and keep the upper hand. Instead speak nicely to the sellers and possibly offer to help with their move to speed things up.
I hope this article has helped about do you have to move on completion day
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