the de­posit

The Advertiser - Real Estate - - Real Estate - with Michael Brock

WHEN buy­ing a prop­erty, pay­ing the de­posit is an im­por­tant part of the sale.

The pay­ment sig­ni­fies that the buyer in­tends to be bound by the con­tract of sale, which is a legally bind­ing doc­u­ment. Fail­ure to hon­our the obli­ga­tions of the con­tract of sale will re­sult in a breach of the c o n t r a c t , whi c h c a n h a v e se­ri­ous con­se­quences.

The amount for a house de­posit can be ne­go­ti­ated but gen­er­ally the de­posit is 10 per cent of the sale price. The ven­dor has the right to set a spe­cific de­posit price but they should dis­cuss this amount with their agent.

Sim­i­larly, po­ten­tial buy­ers should ask about the de­posit amount be­fore mak­ing an of­fer so there is no mis­un­der­stand­ing on what is re­quired.

The de­posit must be paid as soon as the cool­ing-off pe­riod ex­pires. When the de­posit is made, it is paid into the trust ac­count of the real es­tate agency han­dling the trans­ac­tion. At set­tle­ment the de­posit be­comes part of the pur­chase price.

Buy­ers who buy at auc­tion should be aware a de­posit is re­quired at the con­clu­sion of the auc­tion. They should make sure they have funds avail­able on the day of auc­tion.

When sav­ing for a de­posit, it is im­por­tant you fac­tor in all the fees and charges as­so­ci­ated with buy­ing prop­erty.

Th­ese charges in­clude stamp duty, lender fees, le­gal fees and in­spec­tions costs.

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