6 Steps to a Seamfree Conveyance
Spring has sprung and now the summer hunt for a new property is well and truly underway. The excitement of finding your new home could lead to disappointment if you don’t follow the right process.
Here’s a simple, step by step guide to ensure you have a stress free time.
Once you have narrowed your search and decided on the location in which you want to buy and you know what your budget will be, do some research into lending institutions to find out which one which best suit your needs. You can research online at the lender’s webpage using the calculators they provide to calculate your possible borrowing capacity, your expected monthly repayments and the expected stamp duty on a property in the budget range you are considering. The latter additional cost will need to be added to your borrowed amount. Once you have decided on a lender, make an appointment to get further information and then have your home loan pre-approved. Ask questions about the process from your lender’s perspective and find out what they will require from you.
Armed with your finance approval and knowledge of the process, you can then move forward with confidence to locate your new home.
You have found YOUR property. The Real Estate Agent has given you a Contract for Sale of Land, you are overwhelmed at the number of pages to wade through and have no idea just what that legal jargon means. This is where you take the stress out of the equation and call your solicitor. Our solicitors can undertake the necessary searches and review the contract prior to you signing. Any problems or issues you need to be made aware of will be advised. Employing a professional at this point can stop your dream home from becoming the house from hell and potentially save you from buying a lemon. You should also inform your lender that you have found the property you want to buy, so that they can organise a valuation of the property and provide you with an unconditional loan approval.
All going well, your offer will be accepted by the vendor, and both parties will sign the contact of Sale of Land and exchange occurs at which point the contract then becomes a legally binding document. If you are entering into a private treaty, additional specific conditions can be added to ensure particular points of negotiations are included. You should also contact your lender as they may have their own requirement regarding the property.
When purchasing a property payment of a 0.25% deposit is required at the time of exchange, when you sign the contract for sale. Following this you will usually have a five day cooling off period unless you negotiate an extension of 10 days. If you pull out within the cooling off period you will lose 0.25% of the purchase price If however you choose to proceed with the contract, then you will be required to pay the balance of the deposit to make up the total deposit to 10% of the purchase price unless negotiated otherwise.
Should you be buying a property at auction, it is very important that you have your finance application approved unconditionally as there is no cooling off period and you cannot pull out once the hammer has fallen. Prior to auction you should obtain a copy of the contract from the selling Real Estate Agent then contact your Solicitor who can assist with the contract review and organising pest and building inspections prior to the auction. You have to ensure that you have all your due diligence done before you attend the auction. If you are successful at the auction you will be expected to sign the contract on the day at the conclusion of the auction. The property is sold to you without conditions so it is important that you know you have checked everything prior to the day to make sure the property lives up to your expectations. The 10% deposit will be expected to be paid at the time of the successful bid being accepted.
Your Solicitor will now undertake the legal work required to finalise your purchase moving towards settlement. The Solicitor will ensure that all aspects of the property transferring from the old owner to the new owner are seamless. This includes obtaining searches through your local Council ,Sydney Water or the relevant authority, land tax searches, the change to the name on title, calculation of stamp duty and other relevant matters. As you have now committed to buying the property, you should consider taking out building insurance.
You should stay in touch with your Solicitor and assist with some of the running about as in some circumstances you can keep your fees lower.
You are ready to progress to Settlement. At this point the legal documentation of ownership is ready to be transferred from the Vendor’s name to you. On the day of settlement all outstanding amounts such as rates , loans, or any other amount owing on the property are settled and the property passes to the new owner carrying no old debts from the previous owner. If you have a lender, they will attend settlement and handover the loan proceeds to ensure you have the funds to complete the purchase. If you need to top up your loan funds you should advise your solicitor at the outset of how much you are borrowing to ensure that there are no hiccups at settlement. You will also be required to undertake a final inspection of the property the day before or on the morning of settlement to ensure that the property is in the same condition as it was at exchange.
You are not required to attend the physical settlement unless your solicitor specifically instructs you to do so. You and the Agent will be informed once settlement occurs so that the Agent can release the keys to the property to you and you are free to move in. If you have any questions, about the conveyancing process please contact our Property Department and one of our friendly staff will be more than happy to assist you with your enquiry.