A Contract of Sale is typically prepared by the Seller’s representative, and it is no surprise that a substantial number of clauses will favour the Seller. It is important for Buyers to obtain advice before signing the Contract of Sale. The Contract of Sale together with the Section 32 Vendor Statement are the most important documents relied upon in a conveyancing transaction.
Through our years of experience, we have protected our buyers with the inclusion of the following special conditions:
Do you have sufficient finance?
Subject to Loan gives you the option of terminating the contract and recovering your deposit if you cannot get finance approved of your nominated loan amount within a specific time frame. You must fulfil the following requirements:
- Obtain a finance rejection letter from the bank
- Did everything reasonably possible to apply for the loan
- Show that you applied for the loan as soon as reasonably possible after the contract was signed
If you signed the contract without subject to loan, you will not be able to terminate the contract even if your loan application was rejected. You will still need to meet settlement or risk incurring severe penalties.
Is there more than meets the eye?
Subject to Building & Pest Inspection gives you the right to terminate the contract and an immediate refund of any amount paid if the report from a registered building practitioner inspection shows major structural defects or major infestation of pests within 14 calendar days from the day of sale. This can protect you from stress and financial loss or help in negotiating a lower purchase price.
If you realized after signing the contract without subjecting to a building & pest inspection that the property needs to be restumped, the seller is not obligated to rectify this defect nor negotiate a lower price.
The next best thing to a car test drive – Physical Property Inspection
The buyer is deemed to have accepted the property in the condition it is in on the date of signing the contract, commonly phrased as buying ‘as is’. As such, it is important to check the property and goods are in a good state of repair and working order before signing the contract. If any issues are identified, you can negotiate to include the rectification or compensation for these into the contract as additional special conditions to be included in your offer.
We suggest inserting a special condition which ensures that all major fixtures and fittings or other goods to be sold with the property to be in a good working order at settlement. Such a special condition will allow you to receive compensation or rectification if the goods are not in working order.
Is the property one pile away from being featured on the Hoarders television show?
Too often buyers find hard rubbish left on the property at their final inspection before settlement. We suggest adding a clause for the seller to warrant that any rubbish and personal belongings are removed prior to settlement. If there are tenants that are vacating prior to settlement, you can also consider adding a clause requesting that the seller pays for the property to be professionally cleaned before settlement.
Our friendly team at W Legal Group can assist you with pre-contractual advice as a prospective buyer. As your property solicitors we aim to give you peace of mind and take the angst out of purchasing your new home. Contact us at hello@wlegalgroup.com.au and 03 9590 6180 for further assistance!
