A Guide to Buying your Home
In December 2014, the Real Estate Institute of Queensland issued the Tenth Edition of Contracts for Houses and Residential Land.
Below are some of the important items you should know before signing your contract.
Cooling off Period
Under the terms of the contract, a Buyer has 5 business days from receipt of the duly signed and dated contract to terminate the contract should you have a change of mind. There is a 0.25% penalty that may be imposed by the Seller should you terminate the contract under this condition. Talk to us before terminating your contract for advice.
We suggest that you know exactly what your limitations are with your finances. Therefore we strongly recommend you talk to your financier to determine just how much money you can borrow prior to signing a contract.
Building and Pest Inspections
A Building and Pest Inspection Report can help you identify any structural faults or defects in the property that were not apparent from a visual inspection. If your contract is subject to satisfactory Building and Pest Inspection reports, you can terminate the contract before the Building and Pest Inspection date if there are problems with the reports you receive.
Recent changes to the standard REIQ contracts require you to notify the Seller if you are satisfied with the inspections or if you intend to terminate the contract by 5pm on the inspection date or the Seller will be able to terminate the contract.
Previous versions of the standard REIQ contracts allow the Seller to deem the reports you have obtained to be satisfactory if you do not notify the Seller of your intentions before 5pm on the inspection date.
Remember to ensure that any building and/or pest inspector you engage holds the appropriate licenses and that you obtain a copy of the written report.
The current version of the REIQ contract doesn’t make provision to terminate the contract if the improvements have not been properly approved by the Local Council or the property floods. If a search of Council records reveals that the property is subject to flooding or an improvement did not receive Council approval i.e. dwelling (slab, plumbing, frame, final), pergola, carport, pool or pool fencing, then you must proceed with the contract. A special condition may be inserted in the contract, prior to signing, making it subject to satisfactory search results.
The Law deems that the property is owned by you as at the date of the contract, being the legal point of sale therefore if any damage occurs to the property, you may be responsible for the damage unless it can be shown that the damage was as a result of willful neglect or destruction by the Seller. If you have not obtained insurance, the property burns down and the seller does not have insurance, you will have to proceed with the contract regardless.
As the property is at your risk from the date of the contract we therefore urge you to immediately arrange insurance cover over the property to protect yourself in the case of damage or destruction to the property and its fixtures. If you need any assistance in this regard please do not hesitate and seek our advice. A Certificate of Insurance noting a fully paid premium and your financier’s name as First Mortgagee will be required prior to them releasing any finance to you.
Please contact Lynda Simpson or Michelle Bly in our Property Team to discuss your requirements or to review your contract prior to you signing.
Phone: 07 3345 4388
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