How do you know how much time you need to allow for settlement? There are a number of variables that you will need to consider.
We take a look at what needs to happen during the settlement period and offer some helpful tips to make it work for you.
WHAT HAPPENS IF YOU’RE PURCHASING OFF THE PLAN?
If you are purchasing ‘Off the Plan’ then the settlement date will be out of your control. In most large scale developments, the vendor will be very strict about when they call settlement and are unlikely to allow for significant extensions of time. To ensure that you and your lawyer have time to get everything ready the Vendor will provide progress updates.
For more information, take a look at ‘When does my off the plan property settle?’ Click here to read more.
WHAT NEEDS TO HAPPEN BETWEEN THE SIGNING OF THE CONTRACT AND SETTLEMENT?
- Digital workspace set up on PEXA by your lawyer.
- Settlement Documentation drafted by your lawyer.
- You need to sign a client authorisation and have your identification verified.
- Finance needs to be confirmed and funds available from your lender
- Adjustments are prepared by your lawyer.
TOP TIPS ON CHOOSING YOUR SETTLEMENT PERIOD.
GIVE YOURSELF MORE TIME TO BE ORGANISED THAN YOU THINK YOU’LL NEED.
Depending on the Vendor, purchasers may be able to choose their own settlement date. Think about what you need to do to be ready to move into the property. Do you need to sell your current home to have the money to purchase the new property? How long will that take? Have you thought about a removalist and when they will be available?
COMMON TRAP: If you are selling your current home then you will feel more pressure as the settlement date for your new property gets closer. This can be used against you by new purchasers who know that you need to sell and settle quickly. Give yourself time and you will remain in control of negotiations.
CHOOSE A WEDNESDAY/THURSDAY IF YOU NEED TO MOVE IN ON THE WEEKEND.
The typical settlement period is 30, 60 or 90 days, although most purchasers will choose a settlement day before a weekend so that they can use that time to move in. If you choose a Wednesday or Thursday then you still have a day or two buffer if settlement is delayed. That means you won’t have to re-book your weekend removalist which can be very stressful.
ARE THERE ANY SPECIAL CONDITIONS THAT NEED TO BE CHECKED?
If there is a Special Condition in a Contract of Sale that requires works to be completed then you will need to allow time for that to happen when choosing your settlement period.
For example if you require a fence to be painted, cracked tiles to be replaced or electrical work to be completed then break that down in terms of how long it will take to complete. The Vendor will have to do their research to find a trades person, get them to quote the job and then hire them to complete the work. This process can take a couple of weeks.
In a recent article we took a look at what purchasers should do if they want something repaired at a property before settlement. Click here to read more.