1st time Buying is this order correct?

Howdy

I am about to offer on my first Residential property and from everything Ive read I was going to do it in this order - I would appreciate any advice if i have this wrong or I could do it better.

Assumed - ive already found the property been watching it for 2 months and have had agent follow me up on my intitial low ball verbal offer. pre approved Finance in place.

Make written offer on property include the folllowing - subject to
Finance from my Lender
Acceptable Building and pest Inspections

Question - being a townhouse do I have to include a clause for the Body Corporate report ie no problems with the complex etc?

On making offer I "could" pay a holding deposit $100-$500 dollars but not always required.

Question - do I have to state on the offer the amount Im willing to pay as a deposit? I.e. 5% - 10% or can I offer what I feel comfortable with i.e $5000 - $10,000 or is it possible to make an offer and pay minimal to no deposit?.

If Vendor accepts contract passed onto Solicitor - Pest and building inspections arranged other searches completed. If all looks ok approach bank to take up Pre - approved loan, organise property valuation etc

Organise insurance to be in place from date of signing contract.

Question - Sign Contract now?

pay agreed deposit and settle on agreed Date?

I know Ive probably missed a few things......

Please add or remove or comment on any of the above..
Thanks in Advance :)
 
Wazza007 said:
Question - do I have to state on the offer the amount Im willing to pay as a deposit? I.e. 5% - 10% or can I offer what I feel comfortable with i.e $5000 - $10,000 or is it possible to make an offer and pay minimal to no deposit?.

Wazza, Another variation on this is to pay a minimal deposit with remainder of agreed deposit payable upon contract going unconditional.
I did this will a property last year, paid 100 bucks with the other $4900 payable after finance was approved. Property was over 300K.
JIM
 
Thanks Jimmy

I didnt think off that one.

I have also read about deposit bonds but I dont understand how they work but I'll soon fix that with an oogle search :eek:
 
Waz,

The state you are in (geographical not emotional) will impact the steps. In Queensland you sign the contract virtually upfront in my limited experience. I'll assume that you are doing it in NSW and that your finance is OK. Yes you need the finance clause still and the pest and building inspection cluase. Although you're preapproved, stranger things have happened.

You shouldn't need a deposit bond - they are for long term things generally like off the plan where you don't want to tie up your deposit funds for literally years until the project is built and can settle. Do what Jimmyjamjars suggested - here's some to take it off the market and the rest of the deposit will be (whatever you are comfortable with). Agents prefer larger deposits, I was once told, because it enabled them to secure their commission in their trust fund. but the vendor usually doesn't give a tuppeny rag what the deposit is as he can't touch it till settlement.

Stay very very calm. Assume something WILL go pearshaped. Deal with it. You can.

And stay in close contact with your advisors (lawyers, accountants etc - get them to EXPLAIN what's going on).

Best wishes
 
Dear Wazza,

With regards to the offer, I don't make written offers. Simply I sign the contract. It shows the vendor that you are more serious and that document becomes the instrument that you physically negotiate further on (It is normal for multiple prices to be crossed out. ;) ).

A couple of other clauses I would add in:

-Contract subject to the vendor cleaning the property to the satisfaction of "your property manager."
(This saves you the cleaning expense. Understand as well that different property managers have different cleaning standards so put down the name of your PM.)

-After contract goes unconditional vendor agrees to allow purchaser early access.
(IE to repair/renovate/show tenants through. I always like to have my properties tenanted the very day after I settle. Not having a clause like this makes it difficult to achieve and you lose rent.)

Cheers,

Sunstone.
 
With regards to the offer, I don't make written offers. Simply I sign the contract. It shows the vendor that you are more serious and that document becomes the instrument that you physically negotiate further on (It is normal for multiple prices to be crossed out.

In Qld that is a written offer and the only way most agents do business, the contract you sign is the contract of sale but only becomes a binding contract when all parties have signed/initialed it. The reasons you mentioned are why its the best way to negotiate, the seller has all the facts and can make a judgement based on that. In many cases where a verbal offer is made and accepted the seller inevitably gets faced with different conditions once a written offer is received. Old saying, verbal agreements are worth the paper they are written on :rolleyes:

One more point, in Qld the penalty for pulling out of a contract of sale during the cooling off period is 0.25% of purchase price so all agents with the best interests of their client (the seller) will attempt to cover the sellers butt so to speak and get an initial deposit greater than that, ie the purchase price is $320,000, penalty during cooling off is $800.00 so most agents will want a min $1,000 initial deposit with further amount later. Rule of thumb I have seen in NSW is 10% deposit which is not common in Qld.
 
Thanks for all the great replies :)

I should have included the following -
The property is in QLD and valued around $200,000, there is already a tenant in place who will be staying on.

I didnt realise the offer document becomes the contract, so when I make my offer I put my Trust name on it?

I was going to just offer a $5000 deposit on signing the contract.

Haha Im trying to stay calm but I can feel the tummy starting to turn, we head to QLD on Tues.

Ive spoken to a couple of companies about conveyancing but I havnt made up my mind who to use, price ranges vary between $550 - $1000. Some have said because of body corp they visit the complex and go through body corp minutes etc but charge extra $150 for this service - on top of the normal searches.

I found a couple of threads on conveyancing in QLD but I had a chuckle when 1 person would say use these guys and then someone would reply dont use them. :eek: , I'll search the old threads again and ring a couple more.

Thanks again for all the great advice
 
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