Hi guys,
i am currently in the process of contract signing / settling on my first IP and I was wondering if 30 days settlement given to me by vendors REA is quite a common thing or if hes just rushing it. Dont get me wrong I am serious about that property and have all intentions of buy it, however, being that my number 1 IP, I am not sure if i am not commiting myself to some nonsese.
Also I do have my mortgage broker looking into that contract making sure that I can meet all those financial requirements (ie. REA suggesting 5% deposit + 30 days settlement)but no answers from there yet. As i am obviously getting mortgage on this (preapproval given about a month ago) is it possible for financier to provide the finance in this period of time?Thanks
Thanks for helpHi Dan
In our experience, NSW contracts are usually 6 weeks (42 days) while in QLD they are 28 days.Don’t know about other states. 5% deposit is standard in NSW, but deposits can be negotiated (could be $1000) eg if its NSW and they want a quicker settlement they might accept a lower deposit as a trade off.
As to whether you can get finance finalised in the 30 days depends on your finacer. There should be no excuse for not be able to do so, but some can work very quickly, and some take forever. Your broker should have an idea of who is slow and who is generally quicker. Having pre-approval should help.
Your solicitor/conveyancer should be reviewing the contract immediately, and they will be able to advise on variations to the standard settlement periods.
Good luck
Wake.
Dan_76,
I presume this is a bog standard O&A format.
If so, how about wrestling control from the vendors agent and actually writing up the offer like you want it…after all, that’s why they call it an offer…it’s an offer by the Buyer to the Vendor.
Don’t let the Vendor’s agent dictate to you how you construct the offer. That line of thought ends with the Vendor offering the Vendor whatever they want ???
Another tip for you – don’t let the Vendor’s agent write the offer up either. I did this for my first 3 houses, and got stung with clauses in there that I had to fight at settlement.
It’s your offer, you write it up, and you put in it exactly what you want in it. If the vendor doesn’t agree, well, back to the negotiating – if you still want it, but please, doesn’t let the Vendor’s agent push you around..
How do you tell you are being pushed around when you are starting off…listen very carefully for phrases like;
This is how it’s always done
Our standard format is to…
Normally buyers just…
The vendors policy is to..
The accepted practice in this state is…Good luck and happy offering…
Cheers,
Dazzling
“Go hard or go home”
Dan,
DON”T SIGN anything until you have read absolutely everything… ESPECIALLY if it isn’t you that has done the offer up.
Really, they shouldn’t be doing that, it’s your territory…. that’s for you to be putting in what you want. You need to be putting in the offer of what it is that YOU think the property is worth, not what they would like in the bank from it.
I seem to remember one of Steves books saying that it’s either
1. Your terms and the asking price, or
2. Your price and a shorter settlement.have you negotiated any price or have you agreed to their asking price? if so, tell them that you will pay the price only for a longer settlement… 60 or 90 days. if they don’t like it, they can lump it. if no one else is willing to pay that, they’ll hunt you back down later to see if you’re still interested!
Dan, take control of this situation back, as you may regret it later and they certainly won’t have your best interests at heart… they just want to sell it … and NOW. Would hate to see you regretting going through with the decision.
Cheers Dan[biggrin]
Tam
Hi Dan_76
I know how you feel it can be a bit intimidating your first IP. [blush2]
Dazzling is right as well, the agents can tell if your a bit green (we all have been green at some stage or other).
I am in the middle of negotiating my 5th IP (doing 2 at the same time lots of fun!!)and the agents started to say up here in QLD we put 10% dep and 30 days settlement. I said no, being an investor I only ever put down $1000 and I want 60 days([thumbsupanim]- as going up in my hols to paint and will stay at IP until it is painted), he started to argue but I stood by my guns and he weakened and wrote up conditions exactly as I wanted!
So pull in the reins and go for it..after the 1st time it gets alot easier (that’s the same with everthing I guess)
Jenny1
Hi Dan,
You live in NSW and I’m assuming that your intended IP is also NSW.
As has already been said,
1. the ‘standard’ settlement period in NSW is 42 days
2. it should be their price and your terms, or your price and their terms – exert some control to your advantage.I would also NOT waive the contract cooling-off period. It gives you time to review the contract with your solicitor and to negotiate amendments/changes/additions if something is amiss.
Listen to, and take the advice of your team members (solicitor, mortgage broker and accountant) – you know they are on your side and have your best interests at heart.
Hi all,
After some consideration I actually achieved some improvement on the price in my favour;) so I was maybe going bit easier on those settlement conditions.
In the meantime I did have the contract checked by both my conveyancing and mortgage guys neither of them found any problems there.
Also, as commonly expected, I did get my way of for the number of inspections to be done. Not a real achievement on my behalf here I know:) The inspections I asked for are:
1. Building (apparently, and i did not know this, there are two one checking the state of the building itself another one to check the state of any works/constructions done on it afterwards. So getting both as I am no builder myself…yet that is.
2. Pest/termintes
3. Electrical
4. PlumingIs there anything I am missing or am I going over board?
Anyway, I am fully aware that perhaps I am not in 100% control of the situation (hey its my first time wait when it gets to 135th:) but I dont think that I am doing all that bad either.
Appreciate your thoughts guys,
Dan
I am in the same situation as yourself Dan, and I was just wondering is the standard practice to get building inspections and valuations done before you see your solicitor about the contract or do you see your solicitor first and plan them inspections into the contract?
Also, I have put down $1000, the 5%/10% deposit, when is that usually expected to be put down?
Hi Brizza,
Also, I have put down $1000, the 5%/10% deposit, when is that usually expected to be put down?If you have negotiated correctly then the $1,000 is all you pay…. however if you have agreed to pay the 5% then this is payable at exchange (signing of contracts) BTW you have every right to change terms and renegotiate prior to signing anything.
Cheers
KiwiI have purchased property on 30 days. Make sure you have landlord insurance. I use CGU myself . Why I am mentioning this is that a bank may not lend you the money until you have the investment insured and some insurance companies won’t insure until you have occupancy. Also you should be talking with a property manager about getting a tenant as soon as the settlement date occurs if the property is in good order as time wasted is rent lost.
You must be logged in to reply to this topic. If you don't have an account, you can register here.
