So you want to buy a property… what’s next?
Buying a property is a big and exciting step in most people’s lives and one that takes a lot of thought, (and money). So knowing what to do at a time where you are spending a lot of your hard earned wage is important.
We love having the opportunity to join with our clients in this exciting step — to help them achieve their goal of either owning their first home, or stepping into the investment world.
Here are our tips for once you have ‘said yes to the idea of buying property’?
Go and see your broker or banker first. This will enable you to know how much you can borrow and help you know the budget you can work within. You need to obtain Pre-Approval of your loan before you buy anything as this process can take up to a few weeks which, if you have signed a Contract, could eat up your cooling off period. Having Pre-Approval is the banks tick that based on the information you have provided, (your savings, your earnings etc), and confirmation that they are happy to lend that certain amount of money to you, subject to some conditions.
Go looking for your property. This is the fun part, but shouldn’t be rushed. You want to make sure you find the right property for the right price.
Give our office a call and before you sign anything, send our office a copy of the Contract. We can look over it and let you know if there are any major issues from the get-go that would deter you from exchanging. This could help save the 0.25% holding deposit being forfeited to the Vendor as you may prefer not to exchange rather than exchange and pull out during the cooling off period. If you do exchange, be mindful that when we do a ‘deeper dive’ into the Contract and provide you with advice or you complete your pre-purchase inspections, there may still be something that arises that you decide not to proceed but this initial check is good to do for anything in the first instance that may not be what you are wanting.
Once you have exchanged, it is important to provide a copy of the Contract to your broker or banker if you are obtaining finance. This gives the lender an opportunity to do their further due-diligence in respect to the property you are buying and hopefully then be able to provide you with Formal Loan Approval. This formal approval is required to be obtained prior to the cooling off period expiring. If the bank cannot provide this formal approval as a confirmation that they will fund the deal, you either need to rescind the Contract during the cooling off period or ensure you have the funds to complete the purchase. Once the cooling off period has expired, you cannot rescind the Contract on the basis that you do not have the funds to complete. If you are unable to complete the Contract due to lack of funds, the Vendor has rights to terminate the Contract, take your 10% deposit, (even if you pay 5% initially), and possibly sue you for damages.
Some big decisions are made when buying property. Make sure you are in the right position to make them by giving us a call to get further advice and guidance to make this a great experience for you!