Questions with respect to Settlement

[Dwib]

Hi All,

Do I or a representative of mine need to be present for final settlement on a property?

The property is in Brisbane and settlement is due on the 9th January. My solicitor and I are not based in Brisbane. Is this a concern?

There is a backup contract (with a higher offer) on this property therefore settlement needs to be on the 9th January to ensure my contract doesn't lapse. Should I be booking a flight down to Brisbane for this date?

My solicitor doesn't return from Holidays until the 8th January!!! Is this sufficient time for settlement to proceed on the 9th January? Should I be sourcing soembody else to proceed with the settlement?

The backup contract has put some added pressure to get things completed

Any feedback would be much appreciated.

Regards
Dwib.

 

[Rolf Latham]

Hiya DW

Hmmmmmmmmmm

Is the contract unconditional ?

When was it signed ?

Very unusual ................normally an interstate soli would use a local agent at least.

ta
rolf

 

[Dwib]

Hi Rolf,

Hope you had a great Christmas and New Years.

No the contract is not unconditional as yet.

The contract was signed on the 27th Dec. As I understand the contract has to go unconditional 14 days after I signed the contract. This so happens to be the same date as the settlement.

I now understand why the REA was eager for me to agree on 14 days. At the time she said that if there was any issues we could extend the contract but also knowing that there was going to be a backup contract placed on the property.

The solicitor is based in Central Qld. So we are in the same state just not close to Brisbane. Wasn't sure if this would be a concern for settlement.

Cheers
Dwib.

 

[chook]

I think you should ring your solicitor at 9.00am on 8th January and make sure he phones the solicitors on the other side to see where you stand and whether they will extend the contract. I assume you are not financing the purchase because 14 days would not be enough time for a mortgagee to organise everything. The transfer will probably be waiting in your solicitor's pile of mail when he gets back from holidays. This needs to be signed by you and sent back to the vendor's solicitors a few days BEFORE settlement. I had a similar thing happen to me. The agent put 14 days in the contract but when the solicitors got the contracts (and after they had a heart attack) they agreed between themselves (solicitors on both sides that is) that it was just not long enough and they extended the contract. Looking at your situation from the outside it looks like something the agent has done without consulting anyone on the practicalities. However, that being said, just make sure your solicitor rings the other side and confirms an extension.

 

[Dwib]

Thanks for the reply Chook.

I would love to get an extension however as there is a backup contract with a higher offer I would dare say they will not grant me an extension.

Therefore judging from your previous experinece it is going to be a real squeeze to get it all done by the 9th January.

 

[The Y-man]

Does the backup contract really exist?

Cheers,

The Y-man

 

[Dwib]

Hi Y-Man,

Yes I beleive the backup contract does exist. Actually I ran into the guy who lodged the backup contract the day after boxing day in the REA office. So I am pretty sure it does exist.

I guess I will find out when I request for an extension.

 

[jrc]

If your solicitor is on holidays till 8th, presumably he was on holidays on 27th Dec. Have you spoken to your solicitor??

 

[Dwib]

Hi JRC,

Yes that's correct. Our solicitor was on holidays from the 21st December.

Have tried contacting them but no luck.

We withdrew our original offer on the Tuesday prior to Christmas. They rang the next day with a lower price which we accepted. Tried ringing her the following day but she had already left the office.

I am feeling less confident about my situation as I don't think they will have sufficient time to get all the conveyancing done prior to the settlement close. Can it be done in two days?

cheers
Dwib

 

[Ross Sondergeld]

Ok...

Transaction = Queensland
Settlement = 9th January, 2007
Your solicitor returns on the 8th of January, 2007
Unconditional back-up contract exists
Deposit to be lost = ??????.


YOU'RE IN TROUBLE !!!!!!!!!!!!!!!!!!!!!!!!
RING your solicitor pronto !!!!!!!!!!!!!!!!

Time is of the essence in Queensland. Hypothetically, if I was the seller... I would take your deposit on the 9th and preceed with an unconditional back-up offer. (The seller has no legal obligation to extend settlement, unless the parties have mutually agreed.)


"Time of the Essence - Queensland contracts are stated to be expressly “time of the essence”. This means that if any step is required to be taken by a specified time or date and this does not occur, then the party who fails to take the step is in breach of a fundamental term of the contract entitling the other party to terminate immediately. This may have severe consequences for example in respect of: (a) non-payment or late payment of deposits
(b) inability to settle on time. - Michael Sing Lawyers"




- Ross

 

[willy1111]

If you can't get hold of your solicitor today . . . is it possible to get another solicitor today - better than waiting until the day before settlement

 

[Dwib]

Thanks Ross and Willy1111,

Ross - the offer isn't unconditional as yet. So I assume I can still back out and lose a portion of my deposit. If I remember correctly it's 0.25% of the sale price which isn't great either but far better than losing the entire deposit.
But I don't want to back out of the contract.

Willy1111 - I am not sure if I can use another solicitor as the contract already specified the solicitor I am using. Would using another solicitor be another contract. I don't know the answer I will try and find out tomorrow.

Regards
Derrick.

 

[willy1111]

anyone know if you can change solicitors after they have been listed on a Contract.

I imagine a quick phone call to a solicitor will answer that if no one else does.

Good luck

 

[geoffw]

the offer isn't unconditional as yet. So I assume I can still back out and lose a portion of my deposit.

Dwib

Be careful about that!

I don't know if you are from Queensland or not. But in Queensland, the rules are quite different from NSW. In NSW, you have an offer accepted- but it only becomes unconditional when you exchange contracts. But in Queensland, it becomes unconditional (perhaps subject to a cooling off period?) when both parties have signed the agreed offer price (I think that's the way it worked when I sold).

I may be wrong- others could correct me. But it may be well worth while to get legal advice- ASAP.

 

[Dwib]

Just to give those people interested an update of what has occurred over the past 4 -5 days.

After Willy1111 enquired about getting another solicitor I made a few calls to solicitors in Brisbane and explained the situation. They said they could proceed with the settlement. I had to fax them a copy of the contract and also notify my original solicitors not to proceed once they returned from holidays.

The new solicitor said it would be tight but she has set the settlement for 2:30pm on the 9th.

Is there anything else I need to be aware of that could scuttle the settlement from the sellers point of view.

Finance has been arranged.
Insurance for the house has been arranged.
Inspections have been completed.

There is little room to move so I need to ensure I have it right the first time to ensure it settles tomorrow.

Cheers
Dwib

 

[The Y-man]

Hi Dwib,

Please let us know how it pans out.

Cheers,

The Y-man

 

[Syvergy]

Dwib

Be careful about that!

I don't know if you are from Queensland or not. But in Queensland, the rules are quite different from NSW. In NSW, you have an offer accepted- but it only becomes unconditional when you exchange contracts. But in Queensland, it becomes unconditional (perhaps subject to a cooling off period?) when both parties have signed the agreed offer price (I think that's the way it worked when I sold).

I may be wrong- others could correct me. But it may be well worth while to get legal advice- ASAP.

In QLD the buyer has a 5 day cooling off period after the contract has been signed by both parties. In this cooling off period the buyer can cancel the contract with no questions asked, but MAY be liable for a 0.25% penalty on the sale price, taken out of the deposit, at the sellers discretion.

Dwib - It's pretty likely the seller would want to sell the house as quickly as possible. If finance, inspections and insurance et.al. are all completed then all you are really waiting for are searches and official transfer papers to be drawn up.

Thus, the seller would be likely to give you an extra week or so if you need it, rather then leaving the contract and losing another month of mortgage payments.

That said,

It's quite silly to not do the standard 30 days, unless of course you are pre-approved for finance. Even if you are, it gives you space to breathe incase something goes wrong, or in your case, the christmas break occurs. I'm settling my house on the 22nd of January, and purposely added in an extra week into the contract so I could make up for time lost over christmas.

Good luck with everything and tell us how it goes!

 

[Dwib]

Thanks for the email Svergy.

Looking back I totally agree with you with respect to the standard time frame of 28-30 days.

We initially had that in the contract however when we went to resign the negotiated contract the REA crossed out the 28 days and said we'll put in 14 days and asked me to initial it. Which I did

The REA said that it would be fine as we could just extend it if we needed more time. This is after she had already stated a back up contract existed on the property. The week after I signed she said that as there was a back up contract on the property it would be unlikely that an extension would be given. Hence the panic to get things done as soon as possible.

Last night I recieved a call from my solicitor saying that the sellers have requested an extension until Friday to settle as they hadn't got the transfer documents ready. I have been liasing with my solicitor and bank manager on a daily basis ensuring we have everything covered. I am feeling a lot more confident than I did last week. But nothings certain until it's all done and dusted.

Will let you know how I go.

Cheers
Dwib.

 

[Syvergy]

Never trust a REA! I learnt that lesson the hard way on my first few house offers, so by the time I got down to the real deal, I knew I had to be hardline on the REA when it came down to the contract. Especially when they say "Oh, the seller will do this and this" - you can't trust them, since its not in writing, the seller doesn't have to do anything.

Congrats on the extention, thats great news.

 

[Dwib]

Hopefully the final update.

Friday afternoon the property settled to my relief.

Would like to thank all those who commented and gave their opinion on how to proceed. If you guys hadn't contributed I think this one would have got away from me.

Thanks again
Dwib.