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legal
Exchange of contracts
The legal moment at which both buyer and seller become bound to the sale. In auction, exchange happens on the day the hammer falls (traditional) or within 28 days (modern method).
In simple terms
When the deal becomes irreversible — walk away and you're paying damages.
Example
Hammer £150,000 → contracts exchange at the auction; the buyer's deposit becomes non-refundable.
If you're buying
By exchange, your finance must be locked in. There's no mortgage clause to fall back on.
If you're selling
Exchange means the buyer is committed. Fall-through risk drops to near-zero.
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