Buying made simple
Purchasing a New South Wales property can be quite overwhelming and emotionally stressful for some people. It can be one of the most expensive decisions you may ever make. Purchasing a home should be exciting. Here at Jackie Gardner Conveyancing we try to take some of that worry out of purchasing a house, whether it is your first home or you’ve purchased many homes over your lifetime.
Where should I start ?
The first thing you should do is to contact your lending institution to arrange for pre-approval (or conditional approval) this also helps to see what you your borrowing capacity is, and in turn, look for properties in your price range.
Pre-approval from your lender is only based on the information you have provided them and is usually subject to your lender obtaining a satisfactory valuation of the property. Pre-approval may be withdrawn at any time until you have full unconditional approval.
Once you find a property you wish to purchase, and a purchase price has been agreed upon, it is best not to be tempted into putting a ‘holding deposit’ down on a property to secure the property for you. This does not prevent the property from still being marketed or for a Vendor to accept further offers from other purchasers who are in a position to exchange Contracts.
The only legal way for a property to be taken ‘off the market’ is to exchange Contracts.
There are two ways to effect an exchange.
Pre-approval from your lender is only based on the information you have provided them and is usually subject to your lender obtaining a satisfactory valuation of the property. Pre-approval may be withdrawn at any time until you have full unconditional approval.
Once you find a property you wish to purchase, and a purchase price has been agreed upon, it is best not to be tempted into putting a ‘holding deposit’ down on a property to secure the property for you. This does not prevent the property from still being marketed or for a Vendor to accept further offers from other purchasers who are in a position to exchange Contracts.
The only legal way for a property to be taken ‘off the market’ is to exchange Contracts.
There are two ways to effect an exchange.
agent exchange
Contracts are usually exchanged in the Real Estate’s office with terms agreed to by both the Purchaser and Vendor. You will be required to pay 0.25% of the purchase price to the Agent. The Agent will then send the appropriate signed Contract to both party’s legal representatives. You will have 5 (sometimes 10) business days for your cooling off period at which time you should arrange for pest, building and strata (if applicable) reports, as well as organising for your unconditional loan approval. Unfortunately once Contracts are exchanged during this method, the Vendor may not agree to amend the Contract in any way, which includes the addition of any further Special Conditions which may arise from pest or building reports. The Purchaser also may not have had the opportunity to discuss the Contract with their Conveyancer.
vendor exchange
The other way for a Contract to be exchanged is, once an offer has been accepted, the Real Estate Agent sends a Sales Advice to the Conveyancers and then the Vendor’s Conveyancer issues the finalised Contract to the Purchaser’s Conveyancer. The Purchaser will have the opportunity to discuss the Contract with their Conveyancer, and conduct pest and building reports and obtain their written unconditional finance approval. Any amendments may be negotiated prior to you signing the Contract. The Contract is then sent back to the Vendor’s Conveyancer for exchange. However, as advised, no legal binding Contract takes places until exchange.
Cooling Off Period
As a Purchaser, after exchange of Contracts, you are entitled to a 5 day cooling off period which can be used to conduct your pest and building reports and obtain your unconditional loan approval. You must pay to the Real Estate Agent 0.25% of the purchase price as part deposit. The seller does not have the benefit of a cooling off period and is locked in after exchange of Contracts.
As a Purchaser, if you choose to withdraw from the Contract ie rescind the Contract, you will forfeit to the Vendor your 0.25% deposit and both parties are able to walk away from the Contract without any further claim on the other.
You may also choose to waive your cooling off rights as a Purchaser if you have your written unconditional loan approval in place.
At the end of the 5 day cooling off period, the remainder of the deposit is payable to the Real Estate Agent. Once the cooling off period ends, both parties are locked into the binding agreement of the Contract.
As a Purchaser, if you choose to withdraw from the Contract ie rescind the Contract, you will forfeit to the Vendor your 0.25% deposit and both parties are able to walk away from the Contract without any further claim on the other.
You may also choose to waive your cooling off rights as a Purchaser if you have your written unconditional loan approval in place.
At the end of the 5 day cooling off period, the remainder of the deposit is payable to the Real Estate Agent. Once the cooling off period ends, both parties are locked into the binding agreement of the Contract.
Pest and Building Reports
Jackie Gardner Conveyancing will assist you in ordering these reports.
Some additional information on inspections can be found here.
Stamp Duty
The Contract is usually subject to Stamp Duty and you should ensure you have the funds available to pay your Stamp Duty.
Jackie Gardner Conveyancing will be able to advise you in relation to your stamp duty requirements and if you are entitled to any reductions or exemptions.
Please visit the Office of State Revenue website to calculate your stamp duty: www.osr.nsw.gov.au
Jackie Gardner Conveyancing will be able to advise you in relation to your stamp duty requirements and if you are entitled to any reductions or exemptions.
Please visit the Office of State Revenue website to calculate your stamp duty: www.osr.nsw.gov.au
Adjustments and Settlement
Jackie Gardner Conveyancing will complete the adjustments of council and water rates for settlement. Any outstanding rates owed by the Vendor will be paid out from their settlement monies to ensure that you are not left with rates which are in arrears.
Utilities such as electricity, phone or gas are not adjusted at settlement
Once your settlement date arrives, Jackie Gardner Conveyancing will attend to settlement on your behalf, you are not required to attend settlement. Following settlement, you will be advised that you are able to collect your new keys from the Real Estate Agent.
Utilities such as electricity, phone or gas are not adjusted at settlement
Once your settlement date arrives, Jackie Gardner Conveyancing will attend to settlement on your behalf, you are not required to attend settlement. Following settlement, you will be advised that you are able to collect your new keys from the Real Estate Agent.