Buying property involves big financial decisions, whether it’s your first home, next home, or an investment. With Coastwide Conveyancing by your side, you can be confident that every detail will be taken care of. With local expertise in Shellharbour and the surrounding areas, we’ll guide you through the process, protecting your interests and ensuring your purchase runs as smoothly as possible.
Buying a Residential Property – The Process
If you have found the right property, please have your contract reviewed before signing anything. We will examine and explain the contract conditions and disclosure documents, including the title search, registered interests, and special conditions. Our review will help flag potential issues and help you make an informed decision.
Buyer Beware!
The contract provides information about the property’s title but nothing about the quality of the structures. The concept of ‘buyer beware’ applies – we can explain what this means when buying a property, so you are aware of the risks and can carry out your due diligence before entering a binding contract. Due diligence typically includes arranging pest and building reports, ensuring structures are compliant, and checking planning and zoning rules that can affect your plans for the property.
Exchanging Contracts
When you are happy to proceed with your purchase, and your finance arrangements are in order, contracts can be exchanged. Contracts are checked to make sure they are identical, then ‘swapped’ and dated. At this point, subject to any cooling-off rights, contracts become binding, and you are legally committed to buy the property.
What is a Cooling-off Period?
Cooling off is a legal right you have to exchange contracts and, within 5 business days, change your mind and pull out of the deal. It applies to most, but not all, residential property sales in New South Wales. If you pull out, you lose 0.25% of the purchase price, but any other deposit you have paid is refundable.
In competitive markets, it’s common for vendors to ask you to waive (give up) your cooling-off rights. This means you’ll be locked into the contract and not be able to change your mind. To waive your cooling-off rights, we’ll need to provide a signed 66W certificate stating that you are prepared to give up this right. Whether you retain your cooling-off rights or not is your decision, but it is critical to understand the implications of doing so.
Buying at Auction
There are some instances where a cooling-off period does not apply – and one of these is auction sales. When the hammer falls on your bid, you are the buyer of the property, and there is no opportunity to change your mind. You’ll need to sign and exchange contracts immediately. You’ll need to have done all your due diligence on the property, have finance in place, and your deposit ready on the auction day.
If you propose bidding at an auction, we strongly recommend having the contract reviewed by us beforehand.
What Happens Between Exchange and Settlement?
We will further investigate the property’s title, submit a list of questions to the vendor’s conveyancer, and liaise with your lender to make sure it will be ready for settlement. We’ll manage all the final preparations leading up to completion of your purchase, including calculating adjustments for council rates and water charges, and preparing the transfer of land document.
You will need to pay stamp duty, sign your mortgage documents, and make sure that you have the balance of funds available in time for settlement. You should also arrange a final inspection of the property just before settlement.
Settlement of Your Conveyancing Matter
Most conveyancing transactions in New South Wales are now completed online through an electronic platform known as PEXA. On settlement, funds and legal documents are exchanged, and the title of the property will be transferred into your name. After settlement, the real estate agent will be authorised to release the keys to the property to you.
What About Insurance?
If you are buying a freestanding property, make sure you arrange your insurance well before settlement, as your lender will need to have confirmation of this before providing funds. There is also an element of risk to you if something happens to the property before settlement.
Joint Tenancy or Tenancy in Common?
If you’re buying a property with someone else, you’ll need to decide whether you are buying as joint tenants or tenants in common. Joint tenancy means that all owners buy the property together and own it equally. There is no ‘apportionment’ of shares, and if one owner dies, their interest in the property passes to the surviving owner/s. If you buy property as a tenant in common, you own an actual share of the property, which need not be in equal portions, for example, 30% and 70%. Tenants in common can leave their share of a property in a Will to whomever they like.
For help with your next property purchase, call 02 4295 3047 or email [email protected].