Especially if this is the first time you step on the property ladder, it is imperative that you gain an understanding of the process of purchasing property.
Here is a general description of the stages of a property purchase and reading through this may be of help to you to ask the right questions of your legal advisor, real estate agent or your Multi-Choice Consultant.
Before continuing, the most important point to note is that you should always seek professional advice before committing yourself to legal and financial obligations.
■Before shopping for that home, let a Multi-Choice Home Loans Consultant get your loan pre-approved, which will enhance your confidence and possibly help you negotiate a reduction in the purchase price. So call our office today for an obligation free, no cost pre-approved loan that will help you take the next step.
■Before signing the purchase contract, see your solicitor or legal advisor.
■Please note that conveyancing detail differs between the states.
Stage 1 – Get a Pre-Approval
Prior to house hunting it is advisable to have your Multi-Choice broker secure a pre-approval for you with the lender of your choice. Have your loan approved for either a specific sum or alternatively a maximum lend. Don’t forget that the maximum loan offered by lenders differs vastly from one bank to another. A Multi-Choice consultant can very simply show you maximum limits offered by different lenders so please contact us today to put yourself in a strong position for your property purchase. A pre-approved loan won’t cost you a cent and you will get the benefit of personal help from us.
Stage 2 – A Conditional Contract
Once you have signed the purchase contract, fax or email a copy of the contract to your Multi-Choice mortgage broker ASAP. That way there will be no time wasted in ordering a bank valuation if required, which can take up to five working days should the valuer be delayed. Waiting on unconditional finance approval with the deadline looming is no fun for anyone!
Remember that a pre-approval certificate is still no guarantee; it is subject to the property being suitable as security for the loan (which is normally not an issue if the property is in a major metropolitan area).
The contract as depicted below is conditional upon a 14 day finance clause and a 7 day building and pest inspection clause. This means that you need to have those conditions met to your satisfaction, or as stated by your contract, prior to letting the vendor know that all is fine and you will proceed with the purchase. Please be sure to refer to your solicitor and also ensure that you communicate with your solicitor. Don’t forget to arrange an insurance cover note on the property being purchased from the moment it is accepted by the vendor.
Stage 3 – An Unconditional Contract
Once you have met all your conditions of purchase you can then proceed to stage 3, the “point of no return”. ie the point at which the contract is unconditional. At that point the vendor usually will expect a large enough deposit that clearly evidences your intention to settle. Should you fail to settle as per the contract terms, you will be in breach of contract and the vendor may expect you to forfeit your deposit – in other words the deposit is “hurt money”. The vendor is also entitled to pursue it further. Therefore make certain you communicate with your solicitor through this process and also with your Multi-Choice consultant.
