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.
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.
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Anderson Lawyers.
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