Buying a Property: Your pre-purchase Guide
Purchase price
Before you look to purchase, you must ascertain your finances and establish a budget for your purchase. To do this, contact your mortgage broker or bank. They will provide you with a guide regarding how much you can borrow, thus how much you can spend.
Talk to a Real Estate Agent
Once you have established a budget, you should talk to a Real Estate Agent. Here, you can discuss your budget and property brief.
Engage a Lawyer
You will need to engage a lawyer to review the contracts of your proposed purchase. Once you have found a property, the purchase process is fast and requires you to seek apt legal advice. Therefore, it is imperative to tell your solicitor that you are looking to purchase so that they are ready to assist and represent you with your purchase.
When you have found your Property
When you have found your ideal property, it is fundamental to act fast. Get in touch with your lawyer before making an offer on the property. In doing this, it will enable your lawyer to review the contract, as well as undertake the necessary due diligence, including:
Negotiate the terms of the contract, including settlement period, deposit to be paid, and any nasty terms that might be in the contract;
Carry out a pest and building inspection;
Obtain unconditional finance approval for your mortgage;
Obtain a Strata Report if purchasing a unit or townhouse.
Exchange of Contracts
When both the Purchaser and Vendor have signed duplicate contracts, the deposit paid, and contracts are formally dated and exchanged, the parties are then bound to the contract.
There are two forms of exchange:
Exchange with a cooling-off period;
Exchange without a cooling-off period.
Suppose contracts are exchanged with a cooling-off period. In that case, the purchaser is only required to pay a 0.25% deposit, with the balance (being either 5% or 10% of the purchase price) due and payable at the end of the 5 days cooling-off period. The purchaser may rescind the contract during this time, for whatever reason, but would forfeit the 0.25% deposit paid.
Suppose contracts are exchanged without a cooling-off period. In that case, the vendor and purchaser are bound by that contract and cannot rescind. As such, it is vital that a Lawyer reviews the contract first and all due diligence is undertaken before the exchange.
Once contracts have exchanged and the cooling-off period has expired (if applicable), you are bound by that contract and purchased your property.
At Wainwright legal, we take particular interest in and specialise in Property Law. So for all your property law needs, contact us today.