A good mate from work had a deposit bond for an off the plan property for which he had a deposit bond for some time. Before this expired he paid the $24k deposit for the property. He just came back from India and phoned re: settlement time, etc. He was then informed that the property had been sold and that he should have notified them earlier as the develepor/vendor stated that the deposit bond had elapsed. My friend told me that on a deposit bond the purchaser should be notified one month prior to the Bond lapse date. Can he get his deposit back or will he have to kiss this good bye? The ironic thing is that a very similar thing happened to me almost a year ago however it wasn’t over a deposit bond. However I was lucky I didn’t put down a deposit.
Cheers,
Gatsby!Hi Gats,
I can’t say for sure (one way or another) whether your friend will get back his deposit. According to the info in the links below, it doesn’t look promising, but then, who knows, with a good legal team anything is possible.
http://www.anz.com/australia/insurance/deposit/faqs.asp
http://www.cascadefinance.com.au/bonds.html
Plus I am sure there are many here who are well versed in transactions associated with “Deposit Bonds” and “OTP” purchases, and who can shed a brighter light on this situation.[book]
Fingers crossed that it all goes well for your friend!!!
Cheers,
Jo
hi gatsby, this is very distressing – has your friend sought legal advice yet – the fine print will tell all I expect – hope it works out, but i’d be very interested if you wouldn’t mind updating us along the way.
cheers
Brendan Heagney
Mortgage Broker
07 3240 4815I am not sure either.
The property had probably grown in value and the developer resold it at a higher profit, making more money.
Terryw
Discover Home Loans
North Sydney
[email protected]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
Hi Gatsby,
I’m really surprised that they could get away with that! My husband and I used a deposit bond for our first property as we needed to sell a couple of things to get the deposit together. We only got a deposit bond for 6 months as that was when the unit was meant to be completed. It ended up actually taking a full year. When it was due to expire, we asked our bank if we needed to get another one, they told us that we didn’t as it was actually valid unless the seller requested that you pay the deposit and give you notice of that intention.We ended up not paying anything (except the $1000 holding deposit) until settlement. We had no problems, never got questioned. Did exactly the same thing with our second property too.
Thanks,
LuckyoneThanks Jo, Brahms, Terry and Luckyone,
I’m seeing my friend tomorrow and will find out what has evolved since. I will keep you updated. The thing I found most humbling about my mate is that apart from how pissed he was initially, how he has taken it very philosophicly! Don’t get me wrong. He’s by no means a fool and will have exhausted every channel (legally, etc) by now. It just shows how he is able to move on for the next opportunity, despite the loss in a rising QLD market and how settlement could have enabled him to pay off his PPOR, etc.
Cheers,
Gatsby.PS, Jo, once AGAIN, many thanks for the links. I will email them to him!
Cheers,
Gatsby!What was the final outcome Gatsby??????
Hi Yack,
I’m seeing him on Friday at work and will find out. I know he has sought legal action but unsure what he intends to do. Will find out and post.
Cheers,
Gatsby!
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