Hi,
I recently assisted my parents to buy an investment property. They have just exchanged contracts. The agent gave them a sheet I have never seen before.
It basically states that if they happen to change their minds about the purchase during the 5 day cooling off period, the .25% deposit(of purchase price) will be lost. If they go ahead the remaining amount of the 10% deposit is paid.
My questions are as follows:
When did this ‘law’ the agent says come about?
Can the buyer (in agreement with vendor) specify any other subject to clauses during the cooling off period?
Regards
RodgerHi Rodger,
I’ve only been in the game a couple of years, but the .25% deposit clause is standard as far as I am aware (I’m located in NSW). It’s pretty fair in my opinion as if you pull out of a deal after Exchange of Contracts (and there was no real justifiable reason for it such as an undisclosed problem with the property), you may be causing great inconvenience to the seller.
The .25% is a small price to pay for those extra couple of days to pull out – with the properties I deal with, it’s only about $250. Cancelling a deal at such a stage could easily mean the vendor has to find the cash to cover some extra repayments, and they would have to go through the hassle of putting the property back on the market.
Regards,
Marcus.
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