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  • Profile photo of jamesjames
    Join Date: 2019
    Post Count: 0

    Hi i have signed a contract to purchase a property in south Australia.Below is the subject to finance clause in my contract. Am i reading right that come approval date if no finance has been approved i am within my right to terminate? Do i need to except there extension of finance if provided, and do i need to show a letter of decline even if the bank hasn’t given me an answer yet?

    SC 1 FINANCE SC 1.1 This Contract is conditional upon the Purchaser obtaining, on or before the date specified below, approval in writing for a loan in the amount specified below (or such lesser amount as the Purchaser may accept) at the interest rate specified below and otherwise on such terms and conditions that the lender requires but acceptable to the Purchaser, to assist in purchasing the property (the “approval”). Upon notification of the approval to the Vendor this conditional provision will be satisfied and notwithstanding that the lender may subsequently withdraw the approval the Purchaser will be bound by this Contract.

    SC 1.2 The Purchaser will use best endeavours to obtain the loan.

    SC 1.3 In the event that the approval is not obtained on or before the latest date for approval and provided the Purchaser has not waived this special condition and communicated such waiver to the Vendor in writing then either party (but, in the case of the Purchaser, provided it has complied with SC1.2) may immediately terminate this Contract by giving notice in writing to the other party.

    SC 1.4 In the event of termination of the Contract pursuant to SC1.3 and provided the Purchaser has complied with SC1.2 all monies paid by or on behalf of the Purchaser will be repaid to the Purchaser.

    SC 1.5 In the event of termination of this Contract pursuant to SC1.3 in circumstances where the Purchaser has failed to comply with SC1.2 the Vendor will be entitled to the deposit which is forfeited and to proceed against the Purchaser for damages for breach of Contract

    Profile photo of TerrywTerryw
    Join Date: 2001
    Post Count: 16,110

    The contract is conditional upon finance being granted, so if no finance is granted you could terminate the contract provided you have complied with the other clauses.

    There is nothing mentioned in these clauses about an extension, or a letter.

    Terryw | Structuring Lawyers / Loan Structuring Pty Ltd
    Email Me

    Lawyer, Mortgage Broker and Tax Advisor (Aust wide)

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