Negotiating the Sale and Purchase Agreement
Offers
If a potential buyer wants to make an offer, you will need to complete the Sale and Purchase Agreement.
The settlement date
The date the agreement becomes unconditional
What chattels are included (things staying behind after sale ie fridge, washing machine, garden shed)
The deposit required and the date it must be paid
The settlement date is when the money is payed and the documents are exchanged for the transfer of the property
when the conditions of the agreement have been met, the sale goes "unconditional"
Do not make any verbal agreement or sign anything untill your lawyer has checked it out.
Conditional and unconditional offers
A buyer should protect thier interests by making thier offer subject to certain conditions.These could include:
Finance being available.
The sale of thier own house going through.
A Valuers and Builders report
The seller fixing any faults or defects ie drainage etc
Thier intentions for the property not being affected by planning or zoning restrictions
lawyers approval
Once these conditions have been met the agreement is now called an "unconditional offer"
Counter-offers
If a buyer offers a price that is lower than your expectations you can counter-offer by crossing out the price entered on the agreement, writing in the price you want, and signing the agreement to return to the buyer for thier signature
All pages of the agreement must be initiallized by both parties once an offer is accepted
Payment of deposit
When the offer is accepted the seller would usually require a deposit from the buyer as a safegaurd. If the buyer breaches any obligations made in the agreement there is money in hand to cover any losses that this causes the seller
Deposits are normally 5-10 percent of the purchase price. A lawyer would normally hold on to this money as the stakeholder untill the agreement is unconditional.
"Unconditional agreement"
When all the conditions in the Sale and Purchase Agreement have been met, the agreement is now "unconditional". This means that the parties must proceed with the sale and purchase
The buyer and seller will then reach an agreement on the "possession date"(the date by which the seller must have left the property) and "the settlement date" (the date on which the money is payed, and the documents enabling the final transfer of the property are exchanged)