Buying a home is one of the most stressful and expensive things you will ever do. It’s vital that you seek legal advice from someone experienced in property law and who knows the area.
Before You Start
The first round of decisions you will likely need to make is in regard to finance. Make sure you read everything thoroughly, from the pre-contractual statement which outlines the fees and charges to which you’ll be subject to the actual mortgage contract itself. Remember you are entitled to legal advice and are under no obligation to sign anything on the spot.
Once you have found a property you like, you will need to arrange a pre-purchase building inspection report and perhaps a pest inspection report. These are written reports about the condition of the property and helps you find out any potentially costly problems. You may be able to use this information to negotiate a reduction in the purchase price. If you’re not sure who to trust to do this inspection, talk to your lawyer. They will be well aware of which inspectors are worth hiring.
Making an Offer
If you’re happy to proceed, you can make an offer. You might be asked to pay a small sum as an initial deposit, this may be refundable if you don’t end up signing the contract.
Signing the Contract
If your offer is accepted then take the contract you’ve been given to your lawyer and discuss your situation with them. There may be several things that can be negotiated in your favour, and you need to be absolutely clear on your rights and responsibilities before signing.
When you do sign the contract you will need to pay the 10% deposit, unless your lawyer has negotiated a special condition otherwise. This is normally held with the real estate agent and is released to the seller after the property is settled. If you don’t have 10% available your lawyer can advise in relation to getting a deposit guarantee in lieu of the cash.
After the contract has become binding, your lawyer has a number of tasks to perform including:
- Arranging payment of stamp duty
- Liaising with the lender in regard to the mortgage
- Checking with various government authorities to see if they have a vested interest in the property
- Checking to see if there are any outstanding debts to local council
- Calculating adjustments for council, water and strata rates
- Making final checks on the title
On settlement day your lawyer or their agent will attend a meeting that will include the seller’s lawyer or agent as well as any lenders involved and the funds will be handed over in exchange for the title and the keys.
Once you’ve made the decision to sell your property, one of the first tasks is to have the Contract for Sale of Land drawn up.
The contract will include not only the legal terms and conditions of sale, but will also specify what items are included or excluded from the sale, and any other special requirements you might have like a longer or shorter settlement than usual, or perhaps that the contract be conditional upon another contract for you to buy your next property. There are a lot of ways that a contract can be varied, so it’s important to discuss your situation in detail with your lawyer/conveyancer.
You also need to know your disclosure responsibilities, as failing to disclose certain things can lead you into a lot of trouble.
Once a purchaser has been found and the contract has been signed and is legally binding, then a deposit is usually paid by the purchaser and is usually held in the trust account of the selling agent.
Settlement (the day that the money is exchanged for the property and keys handed over) is scheduled in accordance with the contract, and is usually 6 weeks after signing contracts. During the wait for settlement your lawyer/conveyancer will liaise with your bank in relation to releasing any mortgage held on the property. In this time you should arrange disconnection of electricity and other services.
Before settlement the purchase price will be adjusted to reflect the council rates, water rates and strata fees that need to be shared between the parties. There may be other adjustments, based on the Contract for Sale.
Once settlement takes place, the real estate agent will be be authorised to release the deposit to you, less their fees.
Contact us to discuss the specific property you are considering buying or selling with an experienced property lawyer in our Campbelltown or Sydney Offices.