Insurance

A failure to act in time in relation to a date relevant to the transaction may mean the loss of rights under the Contract or an exposure to liability in connection with the Property.

Things that must be considered include:

• Deposit
• Insurance
• Cooling-Off
• Contract Conditions

Each of these elements plays a vital role in ensuring a smooth and secure property transaction, and understanding them in detail can help you avoid potential pitfalls.

Deposit

The deposit must be paid to the Deposit Holder as required by the Contract terms which can sometimes be immediately.

What happens if you miss the deposit deadline or fail to provide transfer evidence?

• If you don’t pay the deposit by the required date as required in the Contract, the Seller may have a right to terminate the Contract and claim compensation from you even after you pay the deposit.
• If you don’t provide written evidence to the Deposit Holder of an electronic transfer for payment of the deposit and the deposit has not been received by the Deposit Holder by the due date, the Seller may have a right to terminate the Contract until such time as written evidence is provided.

How can you avoid breaching the contract when paying the deposit?

• To avoid being in breach of the Contract, on or before the due date for payment of the deposit (usually the day you sign the Contract)
• pay the deposit by cheque directly delivered to the Deposit Holder and ensure you have sufficient evidence of when the payment was made; or
• pay the deposit by electronic transaction and provide written evidence of the successful transaction to the Deposit Holder at the time the electronic transaction is made.

What payment instructions should you follow to comply with the Contract requirements?

• You should not rely on any directions or relaxations about payments that are contrary to the requirements of the Contract.

Insurance

When should you insure the Property in a property transaction?

Risk in the Property usually passes to you on the Contract being signed by all parties (and the consequent need for you to immediately insure the Property).

Cooling-Off

The time limit to exercise any Cooling-off rights is five business days only and  subject to a range of conditions.

When does the Cooling-off period start in a property transaction?

• If applicable to your Contract, the Cooling-off period starts on the day you receive from the Seller (or the Seller's agent) a copy of the Contract signed by both parties or, if that day is not a business day, on the next business day.
• If the Seller signed the Contract before you did, the Cooling-off period starts on the day you signed the Contract and communicated your acceptance to the Seller.

Contract Conditions

What are contract conditions?

Steps that must be taken in relation to conditions to which the Contract is subject (such as a finance condition or a building and pest inspection report condition) and the exercise of rights of termination that may arise.

Settlement Date

When and how can the Settlement Date be extended in a property contract?

Usually time is of the essence of the Contract which means that both parties to the Contract must perform their obligations strictly by the due date. However, under the Standard Contract, either party may extend the Settlement Date by up to five business days by giving notice to the other party, without the need for the other party to agree.

 A party does not need to provide any reason for exercising this right of extension. You should take the possibility of an extension of the Settlement Date into account particularly if settlement on the nominated Settlement Date is critical to you or your plans.