While no two properties are the same, most buyers progress through the below stages before finally landing their new home or investment. Having and experienced property lawyer along side will make sure there are no pitfalls along the way.
1. Obtaining finance pre-approval:-
Lets face it, if you are buying a property in Sydney then you are going to have to obtain some help in paying for it- that’s where the banks come in. Pre-approval for most banks can be obtained within 48 hours and some financial institutions are now offering same day pre-approval meaning that you will have a good idea of what you sort of price range you can obtain finance for. Regardless of the amount of pre-approval buyers should account for changes in interest rates, employment and personal circumstances (such as new additions to the family).
2. Locating a property:-
When determining if a property is suitable you should consider location, price, condition of the property, space requirements, surrounding environment and future needs. This stage will involve inspections of the property and negotiations with your real estate agent. You should ensure you are satisfied with the condition of the property and contact your real estate agent with any of your concerns. Often it is a good idea to leave your contact details with real estate agents servicing the area which you would like to buy as often those agents will actively canvass sellers for you, and notify you before the property is listed on the online sites such as domain.com.au and realestate.com.au – meaning you get a jump on the competition.
3. Making an offer:-
All price negotiations must be made through the seller’s real estate agent. It is important that you carefully consider your finances when making an offer. On some occasions the agent will accept the offer and ask you to put down a holding deposit, and even ask you to sign a contract. Prime Conveyancing suggest that you do not sign a contract without speaking with a solicitor first, and if you are unsure about doing so please contact us on (02) 9521 2222 to obtain a overview on whether you should be signing the contract - no obligation and no fee involved.
In some circumstances it will be necessary to sign the contract under a cooling off period in order to secure the property, in other circumstances there will be no cooling off period, or it will be necessary to include certain clauses into the Contract for Sale.
4. Signing the Contract:-
As noted above on some occasions the agent will request that you sign a Contract for Sale shortly after making the offer. The Contract for Sale is a legal document prepared by the solicitor for the seller and for this very reason is always weighted heavily in favour of the seller.
While some cut price Conveyancing firms will gloss over this part of the transaction we regard it as the most critical and for this reason each client is provided with a comprehensive written advice on the contract covering every document included in the contract- and in easy to understand language. Because we see hundreds of contracts every year we also suggest which clauses need to be amended to suit you needs and protect your interests and not the sellers. This written advice is also followed up by a conference where required and any number of emails and telephone calls until you are comfortable with the terms of the contract, its all for the same cost, no extra even though we go the extra mile.
Before signing the contract, or before the expiration of the cooling off period buyers must ensure of the following key events:
a) Contract advice. As noted above demand professional advice from a solicitor to enable you to understand your contractual rights and obligations, the quality of your property, any dealings listed on your title.
b) Unconditional written finance approval. Without finance approval you will not be able to purchase the property and you run the risk of not being able to settle, losing your deposit and being liable to the Vendor for interest and other losses. It is essential you obtain unconditional written finance approval from your lender before you attend auction or the cooling off period expires.
c) Deposit is ready. A deposit must be paid to the agent at the time of signing the contract, unless amended by agreement (and this going with contracts signed under a cooling off period too!). The standard deposit amount is 10% but this can sometimes be reduced to 5% by agreement with the seller.
d) Buyer beware – are you satisfied with the condition of the property? To ensure you are satisfied with the condition of the property there are several searches and enquiries which can be undertaken. If you are buying a house we strongly recommend you obtain a building and pest report. If you are buying a strata property we strongly recommend you obtain a strata report. The more reports you obtain the lower the risks, but knowing the balance is important because some reports can be a waste of money- Prime Conveyancing will advise you the reports you should take out, the reports that you can take out and the reports that can be avoided- its all up to you but we give you the advice to make an informed decision.
5. Pre-settlement:-
The standard settlement period is 6 weeks (although this can be modified by the Contract or by agreement with the seller). This period of time will allow your lender to issue any loan documents and First Home Owner Grant. During this period Prime Conveyancing organise for the payment of stamp duty /or exemption and calculate your correct proportions for water, council and strata (if applicable) levies).
Prior to settlement buyers will need to organise building insurance, together with the connection of electricity, gas and telephone (we take care of the council and water board). One day before settlement buyers will also conduct a final inspection to make sure everything is all ok with the property and ensure that the seller has moved everything out (unless you were wanting to take gran’s old dining table?).
6. Settlement:-
On the day of settlement the bank will provide the loan proceeds (together with an monies from the first Home Owner Grant) to finance the balance of the purchase price (as you would have paid the deposit at the time of signing the contract). A few days prior to settlement Prime Conveyancing would have calculated the exact settlement figures and provide details of any fun shortfall. If there is a shortfall of funds (being the equity that you are paying) we will ask for a Bank cheque to make up the shortfall. The settlement process will take approximately 30 minutes and you will not be required to attend and instead receive a phone call from our office when all is done so that you can collect the keys from the real estate agent.
7. After settlement:-
Congratulations on your purchase! Now the really hard part- moving! Your bank will register the title documents provided on settlement at the Department of Lands to make you the new registered owners of the land. The new documents issued by the Department of Lands (now called Certificate of Title) will be held by your bank until the property is sold or the loan is repaid.
Prime Conveyancing are property solicitors who will ensure your rights are protected and we invite you to contact us or obtain a no obligation quote to see how we can assist you.