Loan Approval

Ideally, it would be good if you had your loan pre-approved in writing prior to looking for a property to purchase so that you know your budget. However, if you find the perfect property before your finance is sorted (which often happens) then do not panic as we can work with you and your financier to secure the property.

Pre-Purchase Inspection

Once you have found a property to buy, we strongly recommend you undertake pre-purchase inspections which are generally building and pest reports for a house and a strata report for a unit or townhouse. You can obtain other reports depending on the type of property that you are purchasing. These are written reports about the condition of the property which can help find out any potential costly problems.

We suggest that you obtain your own independent reports and do not rely upon the seller or agent’s copies (if any) as their reports cannot be relied upon on a later date as those reports were not purchased in your name.

Contract Review

It is very important that we look over the contract so that you have a thorough understanding of the legal terms and conditions of the contract.

If the property is going to auction, then it would be ideal if you could try and provide at least a week for us to review the contract prior to the auction. This would also provide enough time prior to auction to obtain any necessary reports you may want. However, we have turned around contract reviews the same day as the auction.

Exchange of Contracts

There will be two copies of the sale contract: one for you and one for the seller. You each sign one copy before they are swapped or ‘exchanged’. This can be done by hand or post and is usually arranged by the agent or the conveyancer.

Once your offer has been accepted, then the decision needs to be made if contracts will be exchanged with or without a cooling off period.

In most cases, contracts will be exchanged with the agent with a 5 business day cooling off period whereby you pay a deposit in the amount of 0.25% of the purchase price. Within those 5 business days we will advise you on the contract, request any changes to the contract, obtain unconditional loan approval and obtain any necessary reports if not yet obtained. If for any reason you decide not to proceed with the purchase then you will forfeit the 0.25% deposit to the seller, however, if you decide to proceed with the purchase then you must pay the balance of the 10% deposit prior to the cooling off period lapsing. This option is usually undertaken if you are worried about being gazumped, however, this option is not available if the property is sold at auction, if it is a commercial property or if it is a rural property over an area of 2.5 hectares. Please note that you can request for a 5% deposit to be paid instead and you can request an extension to the cooling off period however the seller must agree. There is no cooling off period for the seller. Once contracts have been exchanged, sellers are generally bound to complete the agreement. Contracts become binding once the cooling off period expires.

The alternative is to exchange contracts without a cooling off period whereby we would advise you on the contract, request any changes to the contract, obtain unconditional loan approval and obtain all necessary reports prior to exchanging contracts. Contracts would become binding once the counterpart contracts are both signed and dated, when you have paid the 10% deposit or a 5% deposit if agreed by the seller and when we have provided a Section 66W Certificate which waives your cooling off rights.

We can assist if you are unsure of which option to choose when exchanging contracts.

The Deposit

You are to pay a 10% deposit on exchange of contracts. However, you can request to pay a 5% deposit which is only allowed if the seller agrees. The agent normally holds the deposit in their trust account and is released to the seller after settlement.

An alternative to a cash deposit is a deposit bond or bank guarantee. They can be used to substitute a cash deposit in case you have your cash tied up in other investments and is not easily accessible. This simply means that you pay the full purchase price on settlement. The seller’s conveyancer will hold the deposit bond or bank guarantee on their file until settlement.

Between Exchange & Settlement

Once contracts are binding, we will then undertake the necessary paperwork to transfer the property into your name which usually takes 6 weeks to settle the matter. The settlement period can be shortened or extended through negotiations between the parties.

During this time, we will write to you advising of the next steps; we will provide your incoming mortgagee (if any) with documentation to assist in the preparation of their mortgage documentation for you to sign; we will request from your incoming mortgagee the loan funds that will be available on settlement; we will advise you how stamp duty is to be paid; we will check with various government authorities to see if they have a vested interest in the property; we will sign the Transfer form on your behalf; we will check the settlement figures have been calculated correctly for the adjustment of council rates, water rates and strata levies (if any) and leading up to the settlement we will give you a full break-down of all the settlement figures including any shortfall of funds that we will require you to provide.

Settlement will be booked in with all parties to occur at a mutually agreed time which is usually 2.30pm on the day of settlement. We will confirm the time with you about a week prior to settlement.

It is usual for you to contact the agent to arrange a suitable time for you to undertake a pre-settlement inspection (usually on the morning of the settlement) to ensure that the property is in a satisfactory condition with the agreed inclusions. If prior to settlement the property in question has been damaged, there is usually sufficient time to take care of any last minute discrepancies prior to settlement. However, this can depend on the magnitude of the discrepancies.


Settlement is the finalisation of the sale process. There are usually four parties involved – the seller and buyers’ conveyancers and the banks for the seller and buyer.

Traditionally on settlement, the buyer’s bank would exchange cheques as per the instructions of the buyer’s conveyancer and, in return, would receive the Certificate of Title and Discharge of Mortgage (if any) from the seller’s bank.

Settlements now occur via PEXA which stands for Property Exchange Australia. PEXA is a national online system which provides for electronic settlement of property transactions including payment of settlement monies, duties, taxes and any other disbursements and it also allows for electronic lodgement of dealings to the appropriate Land Registry which will change over the ownership of the property into your name.

PEXA Key tracks settlement in real-time. Instant notifications keep you informed. We can keep you updated on the progress of your settlement whereby you can track your settlement via an app.

After Settlement

Once settlement has taken place, we will telephone you to congratulate you that it has all completed. We will also in due course write to you to sum everything up.

Immediately after settlement, we will write to the agent to have them release the keys to you.

Also after settlement, we will arrange for registration at the Land Registry Services office so that the property can be transferred into your name. In turn, the Land Registry Services office will notify the council and water authority of the change in ownership.

If the property is strata or community title, then we will write to the strata manager notifying them of the change in ownership as well.

If necessary, you will need to arrange for the connection of your telephone, electricity, gas and other services and you should arrange adequate insurance for the property upon settlement.

Contact us to discuss the specific property you are considering buying!

Disclaimer: The content of this publication is for reference purposes only and should not be relied upon as legal advice. Specific legal advice should always be sought to take into account your individual circumstances.

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