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.

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