10 MISTAKES WHEN PURCHASING A PROPERTY WHICH CAN BE AVOIDED - PART 4 - COOLING OFF PERIOD

Part 4 – Cooling off period

Sydney-based legal practice Ross Anderson Lawyers will assist you to avoid or minimise complications which arise when purchasing real estate. We helped many of our clients to avoid multiple pitfalls in the process and now ready to share our knowledge with you.

COOLING OFF PERIOD

In our previous publication we discussed payment of holding deposit to agent.

What happens next? The statutory cooling off period which usually lasts for five business days.

What happens during that period? Well, it is a question of due diligence and what purchaser is ready to invest in for a piece of mind.

Essentially, this time may be used by the purchaser’s solicitor to order a strata report (if the property is a lot in a strata scheme), a pest and building report (if the property is a free-standing home, a villa or a townhouse) and other reports, which are less frequently made.

Ross Anderson Lawyers always recommends its clients to invest in these important inspections, because they may reveal something which may persuade the purchaser to change their mind on the purchase, or budget for further expenses in the future.

Examples include:

• strata report revealing special levies (thousands of dollars each year per unit) struck by owners’ corporation to finance a legal firm to sue a contractor who was negligent in repairing the block of units;
• strata report revealing special levies (tens of thousands of dollars each year per unit) struck by owner’s corporation to defend a claim by owner of one strata lot suing owners corporation for failing to maintain waterproofing of the roof causing damage to one lot;
• building inspection revealing major building damage beyond normal wear and tear, or fire hazard from insulation located close to powerful down-lights in the ceiling of a house.

We believe that even if a house is fairly new, purchasers will benefit from knowing that there may be defects which previous owner chose not to fix and which are not covered by home warranty; and in case of a recently built strata unit, there could be special levies collected to cover for unforseen expenses and borrowings.

One other interesting aspect of ordering a strata report is that it could reveal a history of bad behaviour by a trouble-making tenant (or owner) disrupting peaceful life of a whole block (but only if owners corporations recorded that in minutes of their meetings and inspector could obtain those minutes).

While solicitor is organising these important checks, purchaser should actively work with his or her mortgage broker to try and obtain a formal approval of home loan finance, to be confident that lender will provide funds for purchase.

Conclusion: cooling off period should be used to order property inspection reports and obtain finance approval for purchase.

Ross Anderson Lawyers provides residential and commercial conveyancing services. Please visit  our website for more information.

Contact Andre Petrov of Ross Anderson Lawyers on 1300 86 16 76 or email us to discuss your conveyancing matter.

Mortgage Broker “In Advance Financial Management” will assist to obtain a home loan best suited to your needs. Call Boris Glushankov on 0411 835 071 and mention this post to get a best deal on your mortgage.

(c) All rights reserved. This and any other publications by Ross Anderson Lawyers are copyrighted. Reproduction, copying and commercial use is prohibited unless expressly authorised by Ross Anderson Lawyers.

10 MISTAKES WHEN PURCHASING A PROPERTY WHICH CAN BE AVOIDED - PART 3 - PAYMENT OF DEPOSIT

10 Mistakes When Purchasing a Property Which Can Be Avoided

Part 3 – Paying holding deposit.

Sydney-based legal practice Ross Anderson Lawyers will assist you to avoid or minimise complications which arise when purchasing real estate. We helped many of our clients to avoid multiple pitfalls in the process and now ready to share our knowledge with you.

HOLDING DEPOSIT

Our clients often ask us questions about when, how and to whom is a holding deposit paid?

Pursuant to standard conditions of 2005 Contract for Sale of Land, used by vast majority of solicitors and conveyancers in NSW, purchasers pay to  a selling agent a holding deposit in the amount of $0.25 of the agreed purchase price.

This deposit is so called because it is “held” by selling agent and it is paid usually in the agent’s office on a date of signing of the contract of sale by a purchaser.

It would be useful to remind that by that time a purchaser should already have some funds, at the very least sufficient to cover the following expenses:

1.         Up to 10% of the purchase price to be used as a deposit for the property;

2.         To pay stamp duty (at the time of this publication Office of State Revenue  provides a calculator on their website);

3.         To pay your solicitor or conveyancer’s fees and disbursements, as well as extra services, such as strata report, building report etc.;

4.         To pay for your removal costs, connect electricity, gas, internet etc.

Conclusion: holding deposit is paid at the time of signing of the contract; have sufficient savings to pay for other fees, taxes and expenses

Next: In our next publications you will discover how to organise finance and sign the contract.

Ross Anderson Lawyers provides residential and commercial conveyancing services. Please visit  our website for more information.

Contact Andre Petrov of Ross Anderson Lawyers on 1300 86 16 76 or email us to discuss your conveyancing matter.

Mortgage Broker “In Advance Financial Management” will assist to obtain a home loan best suited to your needs. Call Boris Glushankov on 0411 835 071 and mention this post to get a best deal on your mortgage.

(c) All rights reserved. This and any other publications by Ross Anderson Lawyers are copyrighted. Reproduction, copying and commercial use is prohibited unless expressly authorised by Ross Anderson Lawyers.

10 Mistakes When Purchasing a Property Which Can Be Avoided - Part 2 - Making Amendments to Contract for Sale

10 Mistakes When Purchasing a Property Which Can Be Avoided

Part 2 – Making amendments to contract for sale

Sydney-based legal practice Ross Anderson Lawyers will assist you to avoid or minimise complications which arise when purchasing real estate. We helped many of our clients to avoid multiple pitfalls in the process and now ready to share our knowledge with you.

MAKING AMENDMENTS TO CONTRACT FOR SALE

As you are engaged in price negotiations with the real estate agent or questioning him or her on various aspects of the property, you should ask your lawyer or conveyance to check the contract for sale which was given to you by an agent.

Many agents advertise open houses on Saturdays to attract more potential buyers.

Ross Anderson Lawyers often receive phone calls from potential clients right after open house asking to review the draft contract. Indeed, by Monday morning when the agent opens his office, the clients are already advised on provisions of contract and risks.

The thing is, the contract for sale was drafted by a lawyer or conveyance, instructed by a vendor, (hopefully) within the legislative provisions on conveyancing, however taking into account needs and wishes of their client, not you the purchaser. If, for instance, there are some issues with the property which the conveyance knows about, the contract would tend to minimise vendor’s inconvenience and risks accordingly.

Approximately in 7-8 occasions out of 10, we, having looked through the draft contract, recommended to our clients to instruct us to write to the vendor’s lawyer or conveyancer to amend certain provisions, in order to balance it to the purchaser.

Approximately in 50% of occasions, the vendor approved the amendments. Needless to say, in the event that the amendments were not approved, our clients at least were aware of their risks before making a deposit and therefore made an informed decision.

Conclusion: ask your lawyer to look through the contract after the open house.

As always, we remind that we at Ross Anderson Lawyers provide conveyancing services and the details could be obtained on our website.

Contact Ross Anderson Lawyers on our phone line at 1300 86 16 76 and email us.

Mortgage Broker “In Advance Financial Management”  will assist to obtain a home loan best suited to your needs. Call Boris Glushankov on 0411 835 071 and mention this post to get a best deal on your mortgage.

10 Mistakes When Purchasing a Property Which Can Be Avoided


Part 1 – Negotiations with real estate agents


Sydney-based legal practice Ross Anderson Lawyers will assist you to avoid or minimise complications which arise when purchasing real estate. We helped many of our clients to avoid multiple pitfalls in the process and now ready to share our knowledge with you.



NEGOTIATIONS WITH AN AGENT


With all due respect to real estate selling agents who deal with tens of potential purchasers, having no or almost no experience in purchasing property...purchasers are reminded of a Latin phrase “Caveat Emptor” which means “Buyer Beware”.

In your negotiations with an agent it always recommended to ask questions about various aspects of the property you are targeting and also seek an opinion of your lawyer or conveyance if the answers the agent gave did not satisfy you.


The thing is, from our experience, when reviewing draft contract for sale given to our clients by agents we most invariably found there a clause which reads approximately the following:


“The purchaser agrees that the only representations about the property are those contained in this contract”.



Conclusion: contact your lawyer early, when making enquiries with a real estate agent


As always, we remind that we at Ross Anderson Lawyers provide conveyancing services and the details could be obtained on our website.


Contact Ross Anderson Lawyers on our phone number 1300 86 16 76 and email us.


Mortgage Broker “In Advance Financial Management” will assist to obtain a home loan best suited to your needs. Call Boris Glushankov on 0411 835 071 and mention this post to get a best deal on your mortgage.