How to make an offer
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Before you make an offer there are a few key things to consider.
It’s important to note that the process of making an offer varies between states and territories, but fundamentally involves the following six steps:
1. Review the contract
The seller will have a contract of sale prepared and available for inspection before offering a property for sale. The contract usually includes:
- A zoning certificate from the local council
- A copy of the title to the property as recorded in the Land Titles Office
- Copies of documents outlining other registered interests over the property if relevant
2. Make an offer
Put an offer in writing to the agent.
This should include how much you’re willing to pay, along with any special conditions. A solicitor or conveyancer can help prepare a letter of offer for the property you want to purchase.
Your expression of interest will be passed onto the vendor and they will respond, kick-starting the negotiation process.
The vendor can receive expressions of interest from other people and even exchange contracts with them if they can get a better deal. If this happens, your holding deposit is refundable.
4. Exchange contracts
Once you have agreed on a price with the seller, you will need to exchange contracts and pay the full deposit, which is usually anywhere from 5 – 10% of the purchase price. Your home lender and solicitor or conveyancer will support you through this process.
It’s important to note that you’ll need to arrange for home insurance at this time, as you are the owner of the property from the date contracts are exchanged. Your contents insurance can begin from the time you move in. If you’re buying a unit, you’ll need to arrange a Certificate of Currency from the Body Corporate’s insurer, to make sure the property is adequately covered.
5. Cooling-off period
In Queensland there is a 5 day cooling-off period after contracts are exchanged, (with the exception when you buy a residential property at auction). During the cooling-off period, you can cancel the contract but you may lose your deposit. It’s important to check with your solicitor or conveyancer about whether a cooling-off period applies to your contact before you sign.
You should also check the property during this time to make sure the condition of the building and inclusions are as per the contract.
Settlement time is determined by the vendor but can be negotiated. Usually it’s around 30 days. This is when you pay the balance of the property using your home loan, including Stamp Duty.
You’ll then receive the keys and title deed to your new home.