If Something Goes Wrong Before Completion
Even after your offer is accepted, a house purchase can develop problems. A survey may uncover defects, the mortgage lender may change its decision, the chain may collapse or completion money may arrive late.
What you can do depends heavily on whether contracts have been exchanged.
Simple answer: Before exchange, you can usually renegotiate, pause or withdraw. After exchange, the purchase is legally binding and failing to complete can lead to lost deposits, interest, compensation and legal action.
This guide mainly explains the buying process in England and Wales. Scotland and Northern Ireland use different legal procedures.
Before Exchange vs After Exchange
| Stage | Your legal position | What may happen |
|---|---|---|
| Before exchange | The sale is normally subject to contract and not legally binding. | Either party can usually withdraw, but may lose money already spent. |
| After exchange | The buyer and seller are legally committed. | Failure to complete can be a breach of contract with serious financial consequences. |
| Completion day | Ownership transfers when completion money is received and completion is confirmed. | Keys should not be released until the solicitors confirm legal completion. |
Important: Signing a contract is not always the same as exchanging it. Ask your conveyancer to confirm whether exchange has legally taken place.
Problems Before Exchange
The Survey Finds Serious Problems
A survey may identify subsidence, roof damage, damp, unsafe alterations or another expensive defect.
Before exchange, you can usually:
- Ask the surveyor to explain the finding
- Arrange a specialist inspection
- Obtain repair quotations
- Ask the seller to complete repairs
- Renegotiate your offer
- Continue at the agreed price
- Withdraw if the risk is unacceptable
Send relevant survey findings to your conveyancer. A physical defect may also create a legal, insurance or mortgage problem.
The Mortgage Valuation Is Lower Than Your Offer
A down valuation means the lender believes the property is worth less than the agreed price. The lender may reduce the amount it is willing to lend.
You may need to renegotiate, increase your deposit, challenge the valuation with suitable evidence or consider another lender. Do not exchange until the funding gap has been resolved.
A Legal or Search Problem Appears
Searches and title checks may uncover:
- Missing access rights
- Restrictive covenants
- Unapproved alterations
- Flood or contamination risks
- Leasehold defects
- Estate management charges
- Planned road or development proposals
Ask your conveyancer whether the issue can be corrected, insured, accepted by the lender or reflected in the price. Do not allow pressure for a quick exchange to replace a proper explanation.
If the Seller Withdraws or You Are Gazumped
Before exchange, a seller can normally withdraw or accept another buyer’s offer. This can happen even after you have paid for searches, a survey and mortgage fees.
If another buyer offers more, you may be asked to increase your offer. Before responding:
- Confirm that the seller has received another genuine offer.
- Review the survey and property value.
- Decide your maximum price before negotiating.
- Check whether a higher offer affects your mortgage.
- Avoid increasing the price only because you feel emotionally committed.
Home Buyer Protection Insurance may reimburse some eligible costs where a purchase fails for a reason covered by the policy. It normally needs to be purchased soon after the offer is accepted and before certain expenses are incurred.
If the Property Chain Collapses
A transaction can fail because someone else in the chain loses their buyer, mortgage or onward property.
A collapsed chain does not always mean your purchase is finished. Possible solutions include:
- Giving the affected party time to find another buyer
- Renegotiating completion dates
- Breaking the chain with temporary accommodation
- Using bridging finance where suitable and properly advised
- Finding a chain-free buyer
- Agreeing that one transaction proceeds independently
Ask the estate agent to map the chain clearly. You need to know which transaction has failed, whether it can be repaired and how long the solution is likely to take.
If Your Mortgage Is Delayed or Withdrawn
A mortgage offer can be delayed, changed or withdrawn if:
- Your income or employment changes
- You take new credit before completion
- The lender discovers a property defect
- Your credit position changes
- Requested documents are missing
- The mortgage offer expires
- The lender changes its property requirements
Contact your mortgage adviser and conveyancer immediately. Before exchange, you may be able to delay, apply to another lender or renegotiate the purchase.
After exchange, the contract does not normally disappear because your mortgage fails. You remain responsible for finding the completion funds.
Buyer precaution: Avoid taking out car finance, personal loans, new credit cards or making unexplained large transfers between mortgage offer and completion without checking the possible effect.
Problems After Exchange
Once contracts are exchanged, neither party can simply change their mind. Contact your conveyancer immediately if anything affects your ability to complete.
The buyer cannot complete
The seller may be able to charge contractual interest, serve a notice requiring completion and claim losses. If the contract is ended because of the buyer’s default, the buyer may lose the deposit and face further claims, including the seller’s additional resale costs or loss.
The seller cannot complete
The buyer’s conveyancer may use the remedies provided by the contract. These can include a notice to complete, interest, compensation or legal action requiring the sale to proceed. The correct response depends on the contract and reason for the failure.
Someone in the chain fails to complete
A delay can move through the entire chain. Even if your money is ready, you may be unable to receive keys until funds have travelled through the linked transactions.
Under commonly used contract conditions, a notice to complete may provide a short final period, often ten working days, but the exact deadline and consequences depend on the signed contract.
If the Property Is Damaged Before Completion
Fire, flooding, storm damage, a water leak or vandalism can occur between exchange and completion.
Sale contracts commonly place the property at the buyer’s risk from exchange. Buyers are therefore usually advised to arrange buildings insurance from exchange rather than waiting until completion.
Leasehold flats are often covered through the freeholder’s block insurance, but you should confirm that the policy remains effective and provides suitable cover.
If damage occurs:
- Contact your conveyancer immediately.
- Notify your insurer.
- Tell your mortgage lender where required.
- Request photographs and professional reports.
- Check whether the damage affects mortgage funding.
- Do not agree repairs or changes without understanding the contract and insurance position.
The seller should normally keep their existing buildings insurance in place until completion, but buyers should not assume the seller’s policy protects them.
If Completion Money Is Delayed
Completion funds usually move through solicitors’ client accounts. In a chain, money may pass through several transactions before reaching the final seller.
A delay does not automatically mean the purchase has failed. It may be caused by:
- Late mortgage funds
- Bank security checks
- Incorrect payment details
- A delay lower in the chain
- Late receipt of the buyer’s balance
- A technical banking problem
Stay in contact with your conveyancer rather than repeatedly contacting the seller. The estate agent should release the keys only after the seller’s solicitor confirms completion.
Fraud warning: Verify any change to your solicitor’s bank details using a trusted telephone number. Property transactions are a common target for payment-redirection fraud.
If the Seller Has Not Moved Out
The contract will normally require vacant possession where the property is being sold without tenants or occupiers.
If the seller has not left, has left another occupier behind or has not removed their belongings, contact your conveyancer immediately.
Do not:
- Enter into an argument at the property
- Change locks while ownership or occupation is disputed
- Remove the seller’s belongings yourself
- Accept an informal delay without telling your solicitor
Your conveyancer will consider whether the seller has breached the contract and what immediate action is available.
If Items Are Missing or the Property Is Damaged
The seller should leave items agreed in the TA10 Fittings and Contents Form and remove items marked as excluded.
If you arrive and find missing fixtures, rubbish, new damage or removed items:
- Take clear, date-stamped photographs.
- Keep the TA10 form and property listing.
- Notify the estate agent and your conveyancer promptly.
- Obtain replacement or repair estimates.
- Do not dispose of evidence unnecessarily.
Whether you can recover money depends on the contract, evidence, seriousness of the loss and cost of pursuing the matter.
How to Reduce the Risk Before Exchange
Legal and mortgage checks
- Obtain the formal mortgage offer.
- Confirm all lender conditions are satisfied.
- Read your conveyancer’s report on title.
- Resolve important enquiries and search issues.
- Check that the mortgage offer remains valid through completion.
Property checks
- Complete the appropriate survey.
- Investigate serious survey findings.
- Confirm agreed repairs in writing.
- Review the TA6 and TA10 forms.
- Arrange a final viewing close to exchange or completion where possible.
Money and moving checks
- Make sure your deposit and completion funds are available.
- Explain gifted or overseas funds early.
- Arrange buildings insurance from exchange.
- Check removal cancellation and waiting-time charges.
- Keep emergency accommodation and essential items available.
What to Do When a Problem Appears
- Do not panic or hide the problem.
- Confirm whether exchange has happened.
- Tell your conveyancer immediately.
- Collect written evidence.
- Inform the lender, insurer or surveyor where relevant.
- Understand the available options and deadlines.
- Keep records of additional costs and losses.
- Do not make a new agreement directly with the seller without legal review.
Fast communication can prevent a manageable delay from becoming a failed completion.
The Key Point for Buyers
Remember: Before exchange, your main risk is losing time and costs. After exchange, your main risk is breaching a legally binding contract.
Do not exchange until the legal work, mortgage, survey, insurance and completion funds are ready. Once exchange takes place, report any change in your finances or the property immediately.
ADVAITH HOMES can help you organise the right questions and understand which problem should be discussed with your conveyancer, mortgage adviser, surveyor or insurer.
Official Home-Buying Information
Further guidance is available from the GOV.UK conveyancing guide, the GOV.UK home-buying guide and the Law Society TA6 explanatory notes.