Buying real estate can be an emotionally charged process. If you’re buying your first property or feel under pressure, it can be an even more emotional experience and you can make serious mistakes. That’s why most Australian states and territories allow a cooling-off period after a sale is completed. Before you breathe a sigh of relief, though, you need to understand more about it.
What is the cooling-off period?
A cooling-off period is a set number of days after you make a purchase in which you can say, “Thanks, but no thanks. I want to cancel my transaction.”
Cooling off rule
In New South Wales, you have five business days to back out of a contract you have already signed. You will have to pay the seller a termination fee of 0.25 per cent of the purchase price.
When does cooling off period start?
Day 1 is the next business day from when you exchanged the contract. Note here, signing and exchanging are two different things. A contract exchange happens when both purchaser and vendor sign and date the contract.
Using your cooling-off period
Usually, your financial circumstances won’t take a drastic turn for the worse during the short window of opportunity for cooling off. In most cases, buyers will make use of their cooling-off period when they have a niggling feeling that something is not right or that they’ve forgotten to do something. One might decide to hire a building or pest inspector to set their mind at ease. Another might overlook getting pre-purchase loan approval from their lending institution and have their loan application turned down or delayed.
*Source: our own awesome knowledge and domain.com.au