What should I do before I buy?
- Obtain a copy of the Contract and let us check it
- Arrange your Building, Pest and/or Strata reports
- Contact your lender with details of the property
- Make an offer and negotiate a price
- Make sure your finance is approved and unconditional
- Have your deposit ready
- Inspect the property in different conditions and times of day
- Go to the Local Council & speak to the planning department; check on any nearby development, previous renovations etc.
- Talk to the neighbours if you can – they are often a fountain of knowledge about the area, the property and the neighbourhood
Are there different ways to buy?
The answer is yes and they are quite different in the process involved! A brief overview is set out below.
Private treaty is when you negotiate with the seller through the agent (or the seller direct if there is no agent) then agree on a price. Once you are ready, Contracts are then exchanged. The property is not sold at auction and you may retain or waive the “cooling off period”.
What is a cooling off period?
Cooling off is a right you have at law to exchange Contracts and have 5 business days from exchange to change your mind and pull out of the Contract. If you pull out, you lose 0.25% of the price but any other deposit you have paid is refundable.
Giving up your cooling off rights – Section 66W Certificates
You may be asked to waive (give up) your cooling off right, that is, be locked into the Contract and not be able to change your mind. To do this you will be asked to provide a 66W Certificate, that is a certificate signed by your conveyancer to say that you are prepared to give up this right.
Naturally, whether you retain your cooling off rights or not, it is critical that you are completely informed before you sign the Contract.
When the hammer falls on your bid, you are the buyer of the property and there is no opportunity for you to change your mind. You will be required to sign and exchange Contracts straight away. Naturally it is important that you make sure you have your deposit ready and have done your homework.
There is no cooling off period when you buy at auction. Once you are the successful bidder, there is no going back this is why it is critical that you have had the Contract checked, made your enquiries and arranged your finance before you go to the Auction itself.
Are there things Contracts don’t tell us?
The Contract gives us a lot of information about the title to the property but nothing about the quality of the building on it. This is what is commonly known as “buyer beware”. It is therefore very important to have carried out inspections of the property prior to exchanging Contracts.
At Coastwide Conveyancing we will discuss all the “buyer beware” pitfalls with you prior to ensure that you are aware of all the hidden risks involved in buying a property.
What are the steps in the conveyancing process?
Exchange – what is it?
This is when the Contracts are checked to make sure they are identical, then “swapped” and dated. At this point they become legally binding, in other words, you are legally required to buy.
What happens between exchange and settlement?
Coastwide Conveyancing will investigate the title thoroughly, submit a list of questions to the vendor’s conveyancer and liaise with your lender to make sure they will be ready for settlement.
Is there anything I should do between exchange and settlement?
You must pay your stamp duty, sign your mortgage documents and make sure that you are ready with the balance of funds in time for settlement.
Click here to use the Office of State Revenue Stamp Duty Calculator.
There are two of us – are there differences in how we can buy?
You must decide whether you are buying as joint tenants or tenants in common. Joint tenants is when you buy the whole property together, there is no actual share, and if something happens to one, the whole property passes to the survivor. In tenancy in common, you own an actual share, it can be more or less than 50%, which will pass as set out in your Will if you die.
Should I take out Insurance?
If you are buying a freestanding property, make sure you arrange your insurance well before settlement as your lender will need to see it before providing funds and there is an element of risk to you if something happens to the property before settlement. If you are buying a strata unit, the building will be insured by the Owners Corporation.
There is a lot to know!
Contact us – we can help you sort it all out.