- What is a finance condition?
- What is a Pest & Building Date?
- How long should I request from the agent for these dates?
If you’re looking at the Queensland market and located in NSW or anywhere outside of Queensland, you may have noticed that the process is slightly different. Your contractual obligations when purchasing property differ from state to state depending on where you are purchasing the property. In Queensland, agents commonly require you to put in an expression of interest or offer in writing along with pest & building dates and finance dates. But what exactly are these dates and how long should you request for the contract to be conditional?
In Queensland, contracts can be conditional upon satisfactory finance and satisfactory pest & building, and in some instances a ‘due diligence’ or body corporate report condition. But what is the importance of these conditions and dates? And what does ‘conditional’ mean?
What does it mean for the contract to be ‘conditional’?
To put it simply, a Contract that is conditional cannot be completed unless the terms that make the contract conditional are met within the specified time frame. For example, if the Contract is conditional upon satisfactory finance to be obtained within 14 days from the Contract date, you are not required to complete the Contract until you advise the Vendor that you have received finance and satisfied this condition. The Contract then becomes unconditional and entirely binding on the parties. In the event that you do not advise of satisfaction of a condition during the conditional period of 14 days, the Vendor in most instances reserves the right to end the Contract and retain the deposit paid.
What is a finance clause? If you are obtaining finance for a property, it allows you that time period from the Contract date to obtain formal finance approval. If, by the due date, you are unable to satisfy the finance condition, depending on the wording of the Contract, you are able to end the contract with the deposit being returned to you.
Pest & Building or Body Corporate conditions?
But what about Pest & Building or Body Corporate Reports? The Pest & Building clause also offers the same protection, that in the event you receive a pest & building report that you are not satisfied with, you can negotiate with the Vendor to rectify the issues or end the Contract within the conditional period.
It is recommended that pest & building reports and body corporate reports (if a Strata or Community title property) are obtained during the conditional period to allow you to proceed with the purchase aware of the property and its current condition. These clauses offer additional protections to the buyer when purchasing property in Queensland.
How long should the conditional time frame be?
These conditions may not always be included in every Contract in Queensland, so it is important to discuss your options with the Agent when making your offer and have any requests put forward prior to signing the Contract.
Typically, a 14 or 21 day conditional period for finance and pest & building is commonly the benchmark for contracts in Queensland. It is also important to have the Contract reviewed as soon as possible prior to signing to allow you to make an educated decision in relation to the purchase and put forward any requests to amend the Contract before they are signed and dated.
If you have any questions in relation to a proposed purchase in Queensland, get in touch with the Interstate Property Team at Coutts today!
Please note the information contained in this publication is general information and should not be taken as legal advice applicable to your situation or Contract. Coutts holds no responsibility for any information relied on this blog.
This blog is merely general and non-specific information on the subject matter and is not and should not be considered or relied on as legal advice. Coutts is not responsible for any cost, expense, loss or liability whatsoever to this blog, including all or any reliance on this blog or use or application of this blog by you.