Purchase settlement extension to 6 months allowed?

[gobear]

I am stuck in a situation where I woudl like to purchase 800K property. I have 400K in hand and 400K is required and has minor problem with bank loan (for more info, see what I wrote in here

http://www.somersoft.com/forums/showthread.php?p=558521#post558521

If I forget about the 400K bank loan......I don't know if anyone has tried this method......I have a property that is worth $1.0M and is intending to sell it anyways since I need 400K remaining balance to pay it off. I understand a normal settlement period is 6 weeks. But however, can I actually request the agent\vendor to extend 6 months for settlement date until I have sold my property???? And if the property is sold early.......say month 1 or month 2, etc I will pay the remaining balance straight away since it is still insufficient?

Is this method possible and\or allowable?

If not, what other methods are still available as I am kinda stuck here

 

[Propertunity]

But however, can I actually request the agent\vendor to extend 6 months for settlement date until I have sold my property???? And if the property is sold early.......say month 1 or month 2, etc I will pay the remaining balance straight away since it is still insufficient?

Is this method possible and\or allowable?

On reading your other thread this also is what I thought - a delayed settlement would perhaps be the way forward. You can reach agreement about anything and make it part of a contract.

Yes it is quite common, you just have to get the vendor to agree. They may / they may not.

You will also need a backup plan if your own house is not sold within the 6 months.

 

[RumpledElf]

Yup, same situation as us when we next upgrade. You can set any settlement period you want as long as everyone agrees, and since you can get it extended (not that vendors like that) I'm sure you could bring it forwards if the vendor agreed. Basically you sign subject to sale of your current house.

Also if you hit really willing vendors sometimes you can ask for things like access to the new house before settlement, especially if its vacant and you want to do stuff like paint before you move in. Are the owners of the house you want still living there? Do they need time so that *they* can move to a new house? If so, that is good for you. You might be able to sweeten the deal somehow, not sure what your vendor would want but if it is a distressed sale you could offer to pay some of the legals or something.

This probably hinges on one thing - how easy do you think it will be to sell your current house?

We've already planned for this situation, our current house will be a whisker under the area median price so should be very easy to sell, and has been decorated in a very nice but boring colour scheme with a very nice but boring cottage garden, and it already impresses everyone who has seen it so again, should be easy to sell. We've done the entire renovation with 'someone elses' tastes in mind. We know our market - retirees. What's *your* market?

 

[gobear]

Thanks for the answer

I didn't know that this is common because I would think 6 months would be too long for them, isn't it?

I'd like to ask, if they disagree? Should I raise the original original price that I had offered a little more telling them that it would cover up the interest or something? And at the same time, it saves me the hassle not just the bank loan but paying off the interest as well?

On reading your other thread this also is what I thought - a delayed settlement would perhaps be the way forward. You can reach agreement about anything and make it part of a contract.

Yes it is quite common, you just have to get the vendor to agree. They may / they may not.

You will also need a backup plan if your own house is not sold within the 6 months.

 

[gobear]

This probably hinges on one thing - how easy do you think it will be to sell your current house?

Honestly, our property is a blue ribbon area so I don't worry about not getting it sold, it's just the matter of selling it HIGH or LOW and if I got 6 months to sell, I don't have the pressure to sell quickly and low, that's the main thing. I beleieve extending 3 months is also very tight becasue even the property is sold in month 2, I still need to wait for the buyer to settle the payment. Like normal period is 1 1/2 month which makes it 3 1/2 months and who knows? Maybe they would like to request it to 10 to 12 weeks? (which makes it 4 1/2 to 5 months. Of course I will try to make sure that they won't go near month 6 or otherwise in case they couldn't settle on time, then I would be panicking...

 

[Propertunity]

Thanks for the answer

You're welcome

I didn't know that this is common because I would think 6 months would be too long for them, isn't it?

It all hinges on the reason they want to sell. If they are finding it hard to sell, for example, they might just take you as a buyer becuase there is no-one else and they know they'll get their money in 6 months time as a certainity.
If they need the cash now for an operation - then you've got buckleys. If they just want to pay one of their kids $50K then you might agree to release the 10% deposit to them to do with as they wish. You need to find out their motivation for selling so you can develop a win-win scenario.

I'd like to ask, if they disagree?

Well you're up the proverbial without a paddle . But keep trying to find something that suits you & them.

Should I raise the original original price that I had offered a little more telling them that it would cover up the interest or something? And at the same time, it saves me the hassle not just the bank loan but paying off the interest as well?

Maybe / maybe not.

 

[marg4000]

We just sold my mother's house. Purchasers asked for a 3 month settlement as they wanted to sell their present home. Alternate finance had been arranged in the event that the house didn't sell, so the contract became unconditional 2 weeks after signing.

As they offered close to asking price (which in our opinion was on the high side) we agreed. We also said we were happy to settle at any time that suited them. In the end they asked for settlement about 12 days early, which we were happy to agree to.

A couple of years ago my son and his partner (soon to be wife) found their ideal home. As they intended keeping their existing home as an IP they were in no hurry and happy to include settlement time in the negotiations. It turned out that the vendors had just started to build a new home. Son negotiated an extremely good price on the basis of a 5 month settlement, which allowed the vendors to remain in the house and do a single move into their new home.

There are many different contract scenarios going on all the time. So work out what is suitable for you and make an offer on the property accordingly.

Good luck!
Marg