Buying a property but Settlement delayed

[eternit]

Hi,

I am in the process of buying a property in NSW but the settlement has been delayed twice now by vendor's side. It was initially suppose to settle on 15th dec but was delayed and then it was supposed to settle on 19th dec but now it is delayed till 23rd dec.

I have been told the reason for the delay is because the vendor is waiting on their bank/Mortgage insuarer to be ready.

If it doesn't settle on 23rd dec is there anything I can do to penalise the vendor because I wanted it to settle before Christmas.


Thanks.

 

[Rixter]

Im sure there is...whats your solicitor advise to do??

 

[eternit]

Im sure there is...whats your solicitor advise to do??

He hasn't really advised me anything. Just told me that the settlement has been delayed and he has rescheduled the settlement with the bank (from my side).

I did not ask him about penalising the vendor yet but he did say that he would have penalised them but because he hasn't because the contract was exchanged by the REA. I didn't understand this.

 

[Rixter]

I did not ask him about penalising the vendor yet but he did say that he would have penalised them but because he hasn't because the contract was exchanged by the REA. I didn't understand this.

I dont understand what you explain either.

 

[eternit]

I dont understand what you explain either.

lol...I just re read what I typed and it did not make much sense

I haven't asked my solicitor about penalising vendor as of yet.

However my solicitor mentioned that he would have penalised the vendor if the contract were not exchanged by the REA by putting in some clause for it.

 

[twobobsworth]

Not much you can do. The contract is written to protect the vendor. You delay - you get hit with penalty interest, they delay - nothing.

Just because the REA exchanged doesn't mean the solicitor shouldn't have requested to remove/add clauses to the contract during cooling off.

Why have they delayed twice?

 

[eternit]

Not much you can do. The contract is written to protect the vendor. You delay - you get hit with penalty interest, they delay - nothing.

Just because the REA exchanged doesn't mean the solicitor shouldn't have requested to remove/add clauses to the contract during cooling off.

Why have they delayed twice?

They have delayed it twice because they are waiting on approval from the insurance company because the vendor had a loan of $50K more then the sale price of the property.

 

[twobobsworth]

You can issue a notice to complete which gives them 14 days to finalise. Maybe just sit tight.

 

[Collector]

You can issue a notice to complete which gives them 14 days to finalise. Maybe just sit tight.

Dito,

Issue notice to complete


Also regarding the issues with the bank - they do happen - i had the a sold a unit in Harris Park 4 years ago ($%#(@$ why didn't i keep that one) and the bank delayed settlement and the purchaser was inconvienianced.

The banks discharge section was so busy and was not able to keep up with the market - lots of sales that month?

 

[platinum]

Definitely a notice to complete.

I understand that things were crazy before Xmas however that is a vendor - vendor's solicitor communication breakdown. The vendor should have advised the discharging mortgagee that the sale was taking place. Depending on the bank it can take 6-8 weeks to authorise mortgage insurance.

Now when I meet with vendors, my first question is, what is the approximate amount of your mortgage. And if they are selling with a shortfall I demand written approval that they can supply the extra funds at settlement before I exchange.

Did you end up settling?

 

[eternit]

Definitely a notice to complete.

I understand that things were crazy before Xmas however that is a vendor - vendor's solicitor communication breakdown. The vendor should have advised the discharging mortgagee that the sale was taking place. Depending on the bank it can take 6-8 weeks to authorise mortgage insurance.

Now when I meet with vendors, my first question is, what is the approximate amount of your mortgage. And if they are selling with a shortfall I demand written approval that they can supply the extra funds at settlement before I exchange.

Did you end up settling?

The property settled last week on Tuesday however I have other issues with the tenant who has not paid the rent for last 2 months and says he cant afford it. He was supposed to return the keys on Tuesday (settlement day) but hasn't done that.

 

[auror]

A similar question

I have a similar question (on behalf of my parents, who are currently renting, about to move into PPOR on settlement day).

The vendor has requested delaying settlement by 3 weeks so that they have enough time to move into their newly purchased place. Given that my parents are currently renting, is it OK to ask for some compensation when agreeing to delay settlement (eg. 3 weeks rent)? Any ideas?

 

[auror]

Bumpity...

 

[eternit]

I have a similar question (on behalf of my parents, who are currently renting, about to move into PPOR on settlement day).

The vendor has requested delaying settlement by 3 weeks so that they have enough time to move into their newly purchased place. Given that my parents are currently renting, is it OK to ask for some compensation when agreeing to delay settlement (eg. 3 weeks rent)? Any ideas?

Hi Auror,

you can ask for some compensation if there is a clause in the contract to protect the buyer for this situation.

best to speak to your solicitor if your parents are using one or go through the contract.

 

[auror]

there is no clause for compensation written in the contract. My parents are wondering why if they delay settlement, they pay 10% penalty interest to the vendor but nothing happens if it's the other way round!!

I'll get them to talk to the soli, just wanted to see if there were other opinions here.

 

[eternit]

there is no clause for compensation written in the contract. My parents are wondering why if they delay settlement, they pay 10% penalty interest to the vendor but nothing happens if it's the other way round!!

I'll get them to talk to the soli, just wanted to see if there were other opinions here.

Your parents pay the penaly interest because it would be stated in the contract.

If there is nothing to compensate your parents in the contract and there isn't much you can do....