So you've found your property, what's next?
Congratulations! You’ve found “the one”. Now let’s get your paperwork in order. What’s involved you ask? We’ll take you through the process step-by-step to show you how straightforward it all is.
Step 1 : Exchanging contracts
The first step is signing the contract of sale. Neither you nor the seller is legally bound to go ahead with the sale until a written, signed contract is exchanged.
This contract usually details the:
- Property address
- Names of the parties involved (you and the seller)
- Selling price
- Terms and conditions
- Special inclusions in the sale like a dishwasher or blinds
- Date of settlement (the day you become the owner)
- Exchanging contracts is pretty much what it sounds like—both you and the seller sign a copy of the contract then swap them so they’re both signed. You also have to pay the deposit at this time.
Step 2 : Get legal representation
It’s a good idea to get legal representation to arrange the whole property transfer process, someone who can help you with this is usually a solicitor or conveyancer. While the contract is usually prepared by the seller’s solicitor, your solicitor or conveyancer should check that everything is in order, including checking that zoning, heritage or title restrictions don’t clash with your intended use of the property. Your conveyancer or solicitor should also: Check that all property rates and taxes are paid up Help you arrange property inspections (such as pest and building) before you exchange contracts.
Step 3 : The cooling-off period
If you have bought through private treaty (that is, you’ve made an offer to the owner and it’s been accepted), rather than at auction, you may get a cooling-off period after the contract is exchanged. During this period you can cancel the contract but there may be a penalty which is often 0.25% of the purchase price. The number of days in a cooling off period varies from state to state but your broker and conveyancer should be able to let you know what will apply to your situation.
Step 4 : Between exchange and settlement
The time between exchange and settlement is usually six weeks, although this can change if both you and the seller agree to extend or reduce it.
This is the time when you should:
- Arrange the balance of the purchase price—that is, finalise the finance and sign the mortgage documents
- Insure the property – you don’t want something to happen to the property during the settlement period and find out too late that it’s your responsibility to pay for!
At the same time, your lender will:
- Likely arrange for a valuation of the property
Step 5 : Settlement
Settlement of the property is when the rest of the purchase price is paid, and the keys are yours! You may also need to pay stamp duty at settlement, but it’s almost time to move in.
Step 6: Move in
Congratulations! Now it’s time to enjoy the rest of your life in your new home. Chatting with a broker can help you get on this path, what are you waiting for!
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- Chapter One : Getting started
- Chapter Two : Your Dream Home
- Chapter Three : Money Matters
- Chapter Four : Ways to Purchase
- Chapter Five : Understanding Interest Rates
- Chapter Six : Understanding Home Loans
- Chapter Seven : Lending Sources
- Chapter Eight : Getting Your loan
- Chapter Nine : Choosing a Home
- Chapter Ten : Steps to Settlement