Stage 1. Before contracts are exchanged
You know you’re probably going to have to look at quite a few properties and bid at quite a few auctions before you find the right property at the right price. It will be of immense help to you if you can arrange pre-approved, in principle, finance from a bank or any other mortgage lender before you start looking. This will not only help you set your price range, but also ensures that you can put in an offer with confidence, knowing that the finance has been approved in principle. MTYF can assist by linking you with our property finance associates who in turn can arrange your pre-approved loan. MTYF will also promptly review and advise you on the sale contract to ensure that it does not contain provisions that will disadvantage you, and to ensure that you don’t risk your deposit by buying a property where good title cannot be passed.
Stage 2. After contracts are exchanged
At this stage, you will have made an offer which has been signed off by the owner, or bid successfully at an auction and signed a contract on the spot. This is the stage when most of the conveyancing work is done. It is now essential to move quickly and efficiently. As soon as you inform MTYF that contracts have been signed, we will begin discussions with mortgage lenders and the seller’s conveyancer to arrange payment of all required disbursements such as search fees, make arrangements for registration of your mortgage, and make arrangements for settlement which is when the property is transferred to your name (although the mortgage holder will retain the certificate of title as security for the loan).
Stage 3. Settlement
At this stage, MTYF will have taken steps to ensure that you will have sound and clear title for your new property purchase, that all vendor liability and encumbrances on the property have been discharged, and that your finance has been organised. MTYF will then attend to settlement on your behalf and ensure that you become the registered owner of the property.
If you have a new mortgage, the certificate of title will be retained by the mortgagee as security. If not, MTYF will hand over the certificate of title together will all receipts and paperwork that you may require in order to sell, mortgage, or bequeath the property in the future.
Conveyancing for buyers – know and manage the risks
Listed below are some key risks a good conveyancer can help you guard against:
- Advising you of any third party claims or other encumbrances on title such as the possibility of resumption for rail, road or other government purposes.
- Gazumping – your offer is not binding until contracts are exchanged between buyer and seller – you can be gazumped up to that moment, which is why pre-approved finance is an important advantage.
- Advising you on any contract clauses that are disadvantageous to your best interests.
- If you buy under auction conditions you must hand over your deposit immediately, and you could lose it all if you cannot meet the settlement date stipulated in the contract. If you are up or down-sizing for example, and your purchase depends on the settlement of your current property, MTYF may advise you to take out a deposit guarantee for low cost protection.
- Even if you buy a property for sale by private treaty (non-auction conditions), and there is a cooling off period, you should be aware that invoking the cooling off period could cost you 25% of your deposit.