Step 4 - Contracts and settlement

 

Congratulations, you’ve found the perfect home or block of land. Now you need to make it yours!

The process involved in purchasing a property in Australia is bound by significant legislation and regulation. To ensure you understand your responsibilities as a buyer and to give you the confidence to take this next step in your first home buying journey, it’s important that you have a clear understanding of the purchasing process.

At Peet we’ve been at the centre of thousands of property transactions spanning more than 125 years, and we’re right here to guide you through this important step.

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Purchasing a property is not as simple as handing over your credit card as you would for a pair of shoes. And considering it’s a much larger financial commitment, you’ll be pleased to know that there is a highly robust and tested process involved that is bound tightly by Australian law.

That may sound complex and a little scary. We promise you, it’s not. But it is important that you understand the steps involved so that you’re in control of the process as it progresses.

Securing your first home

1. Present an offer - contract of sale
2. Exchange of contracts 
3. Settlement

 

The role of a legal expert

It is a Conveyancers job to ensure that the conveyancing process – the exchange of contracts and settlement, meets all of the requirements of the law. 

Engaging a legal expert to guide you through the process will give you confidence to make offers with a full understanding of your legal position. Conveyancers have an in-depth working knowledge of all the legislation involved in purchasing a property and will be able to provide invaluable support. 

Do your research before selecting a Conveyancer – making sure they have the right background, experience and qualifications will ensure you’re in good hands. Check out our blog with a list of 10 questions to ask a potential Conveyancer.

Remember, a contract of sale is a legally binding document – we recommend never signing a contract of sale without getting the advice of a Conveyancer.

Present an offer - contract of sale

When you’re ready to make an offer on a home or block of land you will need to present an offer. To do this, the seller’s agent will provide you with a copy of the property’s contract of sale. 

A contract of sale is at the centre of every house or land purchase process in Australia. Its purpose is to ensure a sale of property meets all current legal requirements. 

If you have selected your Conveyancer, ask them to look over the contract of sale to ensure you understand all the conditions outlined in the document. You can then present it to the seller’s agent. 

Conveyancing

Conveyancing is the process of transferring property (home or land) from one person to another. 
The conveyancing process includes two stages:

1. exchange of contracts 
2. settlement - including the settlement period and the settlement day

Once both the buyer and the seller are happy with the purchase price and any conditions on the contract, it can be signed. This is called exchange of contracts. 
It’s at this stage that your deposit has to be paid.

You then move into the settlement period – this is a period of time agreed by both parties (usually between 30-90 days depending on the state) between when the contract is signed and when the property is settled and you officially become the owner.

This period allows for the confirmation of finance, set-up of insurance, issuing of land titles and the final inspection of the property. 

 

And finally, the day you’ve been dreaming of. Settlement day. 

On settlement day the loan documents are signed, title is received, money is paid and you take ownership of your property. And that’s when the real fun can begin. 

 

Arming yourself with the right information will give you the confidence to start making offers and secure your perfect property sooner. For a more in-depth look at the purchasing process, including exclusive tools and tips from experts, sign-up to our First Home Buyer Toolkit. 

 

Disclaimer: All content within the Peet Home Buyer Toolkit (Toolkit) is for information purposes only. While Peet Limited ABN 56 008 665 834 and its subsidiaries and related entities (collectively Peet) endeavours to ensure all information is current and correct, Peet makes no representation or warranty as to its currency or accuracy. It is recommended that you obtain your own independent advice before taking any action following reading any of the content or information within the Toolkit, including before making any commitment of a legal or financial nature or making any application for a financial product or service. Peet makes no representation as to whether a particular financial product or service is suitable to you or you will be successful in obtaining a financial product or service or purchasing a house and/or land. Please read the full disclaimer here.