REAL ESTATE JARGON EXPLAINEDContractContains the details of your house and the conditions of the sale. You should organise a contract through your solicitor/Conveyancer as soon as possible. Even if you don’t know which agent you’re going to choose, preparing your contract as early as possible means your property will be advertised sooner, and buyers will see it earlier.Cooling-off periodOnce you’ve accepted an offer, a 5 day cooling-off period begins. This allows the buyer to conduct building and pest inspections, speak to the neighbours, call the council, etc. If you’re selling by auction, there is no cooling-off period. A 5% or 10% deposit is paid on the spot and contracts are exchanged immediately.Good-will depositOccasionally a buyer will put down a good-will deposit in order to secure the property during The cooling-off period. This is generally 0.25% of the sale price. If they pull out for any reason (except for death or mental disability), you keep this deposit.DepositAt the end of the cooling-off period, the buyer must pay their deposit to secure the sale (either 5% or 10%). The deposit cheque is held by your agent in a trust account.Exchange contractsOnce the deposit is paid, your agent will get you to sign the contract. The buyer signs an Identical copy and both are sent to the solicitors/Conveyancer. If the buying party backs out, they are liable for the deposit.Settlement periodOnce contracts are exchanged, the settlement period begins (normally 42 days). You can use this time to find another house (if you haven’t already), organise your finances, and move out.SettlementThe buyer pays the balance of the purchase price and picks up the keys. Normally your bank And solicitor/Conveyancer will take their fees out of the settlement proceeds and send you a cheque for the rest. Your estate agent will probably take their commission from the deposit, and send you a cheque for the balance.
