Buying: Completion

1

There are two reasons you could be reading this:

  • You want to prepare for the day you complete
  • It’s here at last – after weeks of anticipation, completion day is actually here!

Either way, you’ll find all you need to know about completion day here – the day you take possession of your new home. Before you are able to collect your keys, all that’s required is for your solicitor to transfer the due balance of money (the purchase price minus your deposit) to the seller’s solicitors, and it’s done.

You’d think it should be straightforward. And, usually, it is. But it’s also possible for problems to arise on the day of completion which could delay your access to the property until late in the day, and sometimes even until the next working day. In this section, we’ll look at:

Information about completion day:

  • The best day for completion
  • Time of day you expect to complete
  • What could go wrong?

We’ll also look at some of the nitty gritty of setting up your new home, including:

  • Buildings and home insurance
  • Life Insurance
  • Energy supply
  • Things to do when you move in

Research shows that, in 2015, over 41% of house moves were on a Friday. The second most popular day to move was Monday, at 17%.

Source: Home Owner’s Alliance

What is the best day for completion?

You don’t always have control over which day you complete. However, most people try to make it a Friday, for the obvious reason that it gives them the weekend to unpack and settle into their new home without taking too much time off work.

However, there are also some other reasons it might be worth trying to avoid moving on a Friday:

  • The popularity of Friday for moving means that removals companies are busier. Even if this doesn’t hike up their cost, it means you need to book them well in advance.
  • Estate agents might be busier, too, so collecting keys might take longer.
  • If you find an unexpected problem with your new home, finding a tradesman to fix it could prove difficult and/or expensive so close to/over the weekend.
  • It’s possible that banking systems might get overloaded, increasing the risk of delays in the money transfer process.

What time of day could it happen?

As with many elements of the house buying process, it’s impossible to be precise about exactly when you’ll be able to pick up your keys. However, if you’re a first time buyer at the bottom of a chain, it’s typically (assuming everything goes smoothly) around mid-morning.

To see why it’s impossible to be exact about timing, you need to understand what happens behind the scenes…

The completion process usually starts with your solicitor transmitting the required money (the sale price minus your deposit) to the seller’s solicitor. Once it’s received they’ll send the necessary legal documents to your solicitor, who’ll then pay any taxes that are due (e.g. stamp duty, Land Registry) and register you as the new owner of the property.

So the completion process can’t start until the money from you (the buyer) reaches the seller’s solicitor. This means your solicitor has to both:

  • Act promptly on completion day.
  • Encounter no technical or legal problems.

Although it’s unusual, it’s not unheard of for things to go wrong.

What could go wrong?

Although completion goes smoothly for the vast majority of people, things might go wrong. There are various causes of problems, but the most common are:

Money transfer issues

  • Before your purchase is completed, your solicitor must transfer the outstanding amount (the sale price minus the deposit) to your seller’s solicitor. This means your solicitor must have the necessary funds from your lender. If this is left to the last moment, delays might occur. If you’re worried about problems arising, you could ask your solicitor to confirm that they have the mortgage advance on the day before completion.

Busy solicitors

  • Of course, your solicitor should have their full attention on your purchase, but they are likely to be busy and they’re only human – mistakes could be made. A polite early phone call to your solicitors to ask when the transfer is taking place is a diplomatic way of ensuring they have their eye on the ball.

Always make sure your solicitor has the money required to complete (including stamp duty!) before the day of completion.

What happens if I don’t complete on completion day?

Thankfully, it’s rare that this happens. But if something goes wrong at your end, you could be served a ‘Notice to Complete’ by the seller’s solicitor. This gives you a period (usually 10 working days) to finalise completion. During this period, you’ll be ‘fined’ a daily rate of interest (normally 4% above the Bank of England Base Rate) on the outstanding sum.

For example, if the property value is £200,000 and you paid a 10% deposit but fail to complete on the day of completion, then you’ll be liable to pay interest on the unpaid £180,000. You could also be charged an administration fee for the Notice to Complete.

If you fail to complete within the 10 days, the contract of sale could be rescinded and you could forfeit your deposit.

Setting up your new home

Buildings and contents insurance

If you haven’t already arranged home insurance, you might want to consider adding it to the top of your ‘to do’ list. If you’re unsure as to the various types of insurance, this brief overview could help. Basically, home insurance falls into two categories:

Buildings insurance

This covers the cost of rebuilding your house from scratch, including labour and materials, should it be destroyed by a disaster such as a fire or a flood. It usually includes:

The house itself (including roof)

  • Permanent fixtures, such as kitchen and bathroom fittings
  • Outdoor buildings such as garages, sheds and greenhouses (but not fences, walls and gates)

Note that, although buildings insurance isn’t a legal requirement, most people have it. In fact, it’s probable that your mortgage provider made it a condition of your loan that you take out a buildings insurance policy. If this is the case, you could need to take out a policy at exchange and not completion. Have a good look for the best deal – your mortgage provider cannot force you to take out a policy with them or a preferred provider.

Find more about buildings insurance, including a rebuilding cost calculator, at the Association of British Insurers.

Contents insurance

As the term suggests, this covers your belongings, such as furniture, electrical goods, carpets and curtains if they are damaged, destroyed or stolen.

One useful way to think about contents insurance is that it covers all those things that that might fall out of your house if you were able to pick it up and turn it upside down.

Contents insurance is completely optional, but is could be very useful should you be the victim of an event such as a burglary or flood. Without it, replacing your possessions could be costly.

You should be able to estimate the cost of insuring your contents by moving from room to room around your house and adding up the total value of all the items in each room. Don’t forget to include any contents in your loft or basement if you have one, and any contents in your garden, garage, shed and outbuildings. It all counts. If this is your first home it might not be such a big task.

Cheapest doesn’t always equal best – so always read the small print of the policy and weigh up what’s right for you and your home.

Life Insurance

Now that you own your own home, it’s a good time to think about Life Insurance. After all, could your loved ones cope financially if you weren’t around anymore? Could they afford the mortgage payments as well as living expenses?

We know that, at an exciting time like this, it’s not easy to think about the ‘what ifs’, but it’s an important issue that you’ll probably want to consider at some stage.

As you are able to tell from this guide, we like to think we know what you’re up against when it comes to getting on the housing ladder. Read the Mortgage Life Insurance page to see how Beagle Street could help financially protect loved ones if anything happens to you after your move.

Beagle Street could provide a Life Insurance policy which suits your needs – get a Life Insurance quote online and find out how much in less than 60 seconds.

Button Text

Energy supply

In all the stress and excitement of buying your first home, one thing that’s often (and understandably) overlooked is the need to sort out utilities such as gas and electricity.

Of course, when you first move in, you’ll probably be getting both of these, but are you getting the best deal?

The answer to this is “probably not”. In fact, if you haven’t made any arrangements, you’re likely to be on the existing energy supplier’s most expensive tariff! This is because, when the previous owners moved out, the energy provider to that address could have automatically switched you onto a ‘standard variable’ tariff, in order to ensure continuation of supply. This is often the supplier’s most expensive rate. Typically, you could be paying up to 20% more than you need to [1].

To make sure you’re not paying over the odds, estimate your usage level (see the guide below, if you’re not sure) and then check it against an online price comparison tool.

Don’t worry if you get your energy usage wrong – you could always adjust your payments later and you can provide meter readings every month. The important thing right now is getting off an expensive ‘standard’ tariff.

Guide to UK residential energy usage, per year:

Gas (kWh)Electricity (kWh)
Small house/flat8,0002,000
Medium house12,5003,100
Large house18,0004,600

Source: Ofgem

Remember – take meter readings on the day you move in to avoid overlap with the previous owner’s bills.

Things to do after you move in

For all home movers, whether first time buyers or not, there’s a million (almost literally!) things to do, all equally important. But, as George Orwell might have put it, some of them are more equal than others.

If you’ve been through the moving process before, you’ll know which ones to prioritise. But, if you haven’t, here’s a list of a few things worth dealing with sooner rather than later:

  • Change of address notification – Notify banks, insurance providers and any other financial institutions of your new address. You may also want to consider setting up a redirection service with the Royal Mail for three or six months. It costs from £29.99 (for three months) per surname.
  • Check your belongings for breakage – If you hired a removal company, you’ll have a limited time to report any suspected damage or missing items.
  • Take meter readings – This is part of the process of sorting out your energy suppliers, which we’ve dealt with more fully in the energy supply section.
  • Make sure you’ll be able to find your fuse box,  RCD consumer unit and stop cock if you have to – Make sure you’ll be able to find your fuse box,  RCD (consumer unit) and stop cock if you have to.
  • Check the smoke detectors – Find all the smoke detectors in the property and make sure they’re in working order.
  • Sort out parking – Do you need a resident’s permit? If so you’ll need to apply to your local authority for one.
  • Waste and recycling collections – Make sure you know the frequency and times of waste and recycling collections in your postcode.

Where next?

If you’ve exchanged contracts and know your completion day, you’ll need to start thinking about your move. But should you do this yourself or get professional help? That’s the purpose of the next section of this guide – to help you decide which is the best route for you, and to provide useful information on both approaches. We’ll also look at some of the things you could do, not just to protect the value of your home, but to add to the value of your home.

Previous page

Buying – The Purchase Process

Next page

Moving In – Removals