The Legal Process
Find a Solicitor or Licensed Conveyancer
Whilst it is possible to handle the legal aspect of your property purchase yourself, it is strongly recommended
that you engage an expert to assist you with the legal requirements.
Pay a Deposit
After the vendor has accepted your offer, in NSW you may need to pay a holding deposit to the real estate agent before
any formal exchange of contracts.
Discuss the contract of sale (which outlines your offer, the date of settlement and any conditions that must be met
before the sale goes ahead) with your Solicitor before you sign it. You should also wait for the formal loan approval
to be received before you sign the contract.
At exchange of contracts you are generally expected to pay 10% deposit. If you are borrowing more than 90% of the
purchase price, or have your funds tied up where you can't access them until settlement, we can assist you with
arranging a Deposit Power Guarantee (Deposit Bond).
Deposit Bonds
The Deposit Power Guarantee is an insurance policy that protects the vendor and is a substitue for the cash deposit
required when purchasing a residential property.
A Deposit Power Guarantee can be issued to all or part of the deposit amount required, up to 10% of the purchase
price
Essentially it guarantees the vendor that they will get the full deposit if for some reason you do not complete the
settlement of the purchase and is as legally binding as a cash deposit.
Exchange of Contracts
The exchange of contracts is the event by which you can make the vendor legally bound to sell the property to you
and they make you legally bound to pay for the property by a certain date. Therefore, we recommend that you engage a
solicitor or a licensed conveyancer to act on your behalf for the legal side of buying the property.
You should also confirm your loan has been formally approved as your solicitor or conveyancer will not allow you to
exchange contracts without that approval.
Once the exchange of contracts has occured, the full contract deposit is paid to the real estate agent. You must
advise the agent if you intend to use a Deposit Power Guarantee so they can confirm acceptance with the vendor.
Cooling Off Period
In NSW the law provides the purchaser with a five business day cooling off period after the exchange of
contracts. This can be waived if mutually agreed upon.
Insurance
If you are buying a house rather than a unit or a townhouse, you must have your home insured adequately at all
times. Insurance must be in place prior to settlement.
The choice of insurer is yours, but we can assist you with this as well. Through our insurance partner Allianz
we can offer you up to 90 days free insurance cover on the property you are buying prior to settlement, which gives
you great peace of mind at no cost.
Contents insurance, whilst not compulsory, is also strongly recommened.
Settlement
In NSW, once the contracts have been exchanged and your cooling off period has expired, your solicitor will take
the next 4 to 6 weeks to ensure that your first home purchase proceeds smoothly and without any hassle.
In QLD, the time period to finalise purchase is usually 5 weeks. Your solicitor or conveyancer will prepare and
arrange for you to sign a transfer of land document. You should ensure that this is done at least two weeks prior to
the settlement date. This document will be handed over at settlement to the Greater. We will then register it at the
State's Title Office on your behalf. Upon registration, the property will be changed over to your name.
Next: You're a Homeowner!
