Contract timeframes – have you given yourself enough time?
Property transactions are exciting for both buyers and sellers. So, it is understandable that you may want a quick settlement so you can move in, or have access to the sale proceeds.
For these reasons, it is common to see smaller contract timeframes for finance, building and pest and other special conditions. However, this often can cause more stress and aggravation, particularly where you are relying on third parties such as banks, inspectors and postal services.
You will be less likely to experience delays and extensions when you consider a few key items. First of all, make sure all the dates in the contract are achievable when it is prepared.
If the contract is subject to finance, most financiers, even when taking into account “pre-approval” require between 14 to 21 days from receiving the contract to provide formal finance approval. Keep in mind public holidays and weekends when working out your timeframe, or ask your banker or broker what timeframe is achievable in your circumstances.
Building & Pest Inspection Dates
If the contract is subject to a building and/or pest inspection, bear in mind that Inspectors may not be able to attend to an inspection and provide you with a report in such a short timeframe. So, unless you have spoken to an Inspector about their availability before signing, it is generally best to have at least 14 to 21 days from the contact date also.
Generally a settlement date of 14 days from satisfaction of contract conditions is sufficient for a seller to organise a release of their mortgage with their bank, or the buyer to carry out searches with government authorities and ensure loan paperwork is received, signed and returned ready for settlement.