As a buyer, making an offer is one of the trickiest parts of the bidding process. It’s a challenge knowing when you can give your highest upfront offer or smallest bid in order to steer the negotiations in your favour. That’s why you should be aware of the pros and cons of each decision.
A seller will only be able to put a property on the market if there is a contract of sale. This contract will serve as your reference as it contains the terms and conditions of the sale.
A contract of exchange is created when the seller commits in buying your property or when you have committed to buying a property for sale. This contract of exchange is prepared by a conveyancer, a solicitor or a settlement agent.
When the contracts are exchanged, you are required to hand 10% of the selling price to the seller’s solicitor or settlement agent and will be placed in a trust account.
In case you want or need to withdraw from the contract, you are free to do so within a certain period of time. The cooling-off period, which during 3 to 5 working days after the contract is exchanged, gives the freedom to buyers to decide of pushing the deal or cancelling it without loss. This cooling-off period does not apply for buyers and sellers in an auction.
The property is considered sold when you have already settled the payment, which includes the property price and other necessary fees, and the title and transfer of documents have been exchanged. Usually, settlement takes place 2 to 6 weeks after contracts have been signed by yourself and the seller.
Stamp duty is a government tax that is worth a percentage of the property’s market value. The state tax is included within the amount to be paid during settlement. However, the amount varies according to territory or state. Ask your real estate agent to know more about this.