Hi All
Seeing all the flooding in the Logan aria happening right now I got to thinking what would happen if the property I am unconditional on & settling on in two weeks was flood damaged? Is it my responsibility to ensure I insure the building upon going unconditional to protect myself?
I gave this no thought at all other than the bank saying it must be insured before settlement?
What would the deal be in this situation?
Cheers
S
Organise insurance as soon as you sign contract – you do not want to have a damaged property which you cannot/won’t settle and lead to a long line of expensive legal issues.
Corey Batt | Precision Funding
http://www.precisionfunding.com.au
Email Me | Phone MeInvestment Focused Finance Strategist - servicing Australia-wide
The time between contract date and settlement date is a grey area which is why at least one insurance company offers free insurance to buyers until settlement date. We always go with that. Better safe than sorry 👍😎
Ethan Timor | Aligned Finance Pty Ltd
http://www.alignedfinance.com.au/
Email Me | Phone MeActive Investor & Broker; Based in Northern NSW, servicing Australia wide; Author of '34 Proven Ways to Maximise Your Borrowing Power' (download free from our website)
Not a grey area Ethan.
Under the common law risk passes on the date of contract. This has been modified in a few states so that risk only passes at settlement. The contract is also relevant. I think in QLD the standard contract has the purchaser agreeing to wear the risk. So if you enter into a contract to buy a house and the house is flooded the vendor may be able to insist on settlement.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Thanks guys
It didn’t even cross my mind until the floods. That could have been a very expensive lesson.
Cheers
S
Thanks guys
It didn’t even cross my mind until the floods. That could have been a very expensive lesson.
Cheers
SWhen we bought our last PPOR – it was in a bushfire zone whilst there was significant bushfires burning a hundred km’s away. Even though it was contained all insurers had a blacklist of writing insurance for those few days in SA so we had to wait patiently hoping no freak issue would emerge.
Corey Batt | Precision Funding
http://www.precisionfunding.com.au
Email Me | Phone MeInvestment Focused Finance Strategist - servicing Australia-wide
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