Offer and Acceptance:- Once your offer has been accepted by the Vendor, the Agent will send a Sales Advice to our office and the Vendor’s Conveyancer. We will then be in touch with you to obtain your instructions, information and advise the next step.
Pre-exchange reports:- Before you purchase a property it is important to arrange inspections on the property. The Contract for Sale of Land does not cover the quality of the buildings on the property; it is “Buyer Beware”. After exchange of Contracts there is no recourse if the buildings are defective in some way. Depending on the type of property you are purchasing we recommend the following reports:
Finance:- It is important to ensure that finance is approved before Contracts are exchanged, even if there is a long settlement period, to avoid the risk of defaulting and losing the deposit and perhaps being sued for damages.
Deposit:- The deposit paid is 10% of the purchase price unless otherwise negotiated with the Vendor. The deposit is paid on or before exchange of Contracts in one of the following ways: transfer into the Agent’s Trust Account, providing the Agent with a cheque, providing our office with a cheque. The deposit will then usually be held in the Agent’s Trust Account as stakeholder pending settlement.
Exchanging Contracts:- Once you have satisfied yourself with all your searches and enquiries, have finance approval in place and have signed the Contract we will then obtain your approval to exchange Contracts. Contracts are drawn up in duplicate and one copy is signed by the Vendor and one copy is signed by you, the purchaser. The Contracts are then checked to ensure they are identical and they are dated. The Contracts are then swapped so that each party ends up holding the copy signed by the other party.
Cooling Off Period:- Each Contract has a cooling off period of 5 business days from the date of exchange, however this only applies to purchasers. If a purchaser “cools off” they must pay a penalty of 0.25% of the purchase price to the Vendor. It is common practice for the cooling off period to be waived so that the Contract is binding on both parties after exchange of Contracts. Most Vendors will request that I sign a Section 66W Certificate which will waive the purchaser’s cooling off rights. It is for this reason that it is important to obtain all reports, searches and finance approval prior to exchange of Contracts. There is no cooling off period if the property is sold at Auction.
Stamp Duty:- Stamp duty is payable on the Contract within 3 months of the date of exchange or on settlement, whichever is first. Stamp duty depends upon the purchase price, the higher the price, the higher the stamp duty.
Searches:- After exchange of Contracts we will carry out various relevant searches on the property such as: council rates, water rates, strata levies and land tax. We will advise you on the outcome of these searches.
Adjustments:- We will draft a Settlement Statement which adjusts on council rates, water rates, water usage, strata levies and anything relevant to the property. This statement will then be approved by the Vendor’s Conveyancer. The outcome is that each party only pays for rates and levies for when they own the property.
Pre-Settlement Inspection:- A Purchaser is entitled to a final inspection of the property prior to settlement. We recommend conducting the final inspection on the morning of settlement. This inspection is to ensure that all the inclusions are in the property and no damage has been done to the property in between exchange and settlement. The property should be left in a similar condition to as it was on exchange of Contracts. If there is a problem with your pres-settlement inspection you must notify us as soon as possible. Once settlement takes place you will have no recourse on the Vendor should you find something wrong with the property.
Immediately after settlement we will notify you and the Agent that settlement has taken place. We will forward an “Order on Agent” to the real estate agent which authorises him to release the keys to you and the deposit to the Vendor. We will also advise the local council, water authority and strata manager of the change in ownership.
Should you have any questions please do not hesitate to contact us.
