Hi everyone,
I’m thinking of bidding a house that is under mortagee auction. But in section 32 and contract, it was stated there is outstanding payment (arrears) to the city council which amounted to around $4000.
I just wondering who should be paying for that if I’d have won the auction?. I’ve rang the city council and its debt collection agency, but none of them can give me the answer.
Can anyone help me on this?
Thanks in advance
Cheers
BudiHI there
you might just want to confirm the following with your solicitor – but what you are describing are outstanding rates which are normally adjusted at settlement. The Vendor is usually responsible for rates up to the settlement date and and the Purchaser after the settlement date.
The auction contract will normally say something like settlement will occur 30 days after the parties sign the contract.
Because a mortgagee has stepped into the role of the Vendor – and he wants to be in a position to give clear title to the Purchaser – normally the arrears would still be dealt with at settlement – there would be a cheque for Council.
As a Purchaser – you would want to make sure the Council was paid at settlement or else your land would be charged with the outstanding rates.
Hopefully there is enough money to pay both the Council and the Mortgagee after the auction – you would definately want to make sure they won’t be looking to you for any payment.Any arrears will be paid by the vendor/mortgagee. Your solicitor should ensure that he/she receives cheques at settlement to cover these arrears.
Julie
Property Conveyancer
Melbourne
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