Review the contract Ensure you review the contract thoroughly before making an offer. Check over the finer details and make amendments through your conveyancer before signing. Once all revisions are accepted and finalised, you are ready to exchange. Exchange of contracts Contracts are exchanged legally, with one signed copy for each party. At auctions, exchange occurs immediately after the winning bid; in private treaty sales, documents are signed and exchanged within two business days by hand or post. This process is typically managed by a solicitor, conveyancer, or agent and legally binds both parties. Deposit ready? At the time of the exchange, the buyer must be prepared to pay a deposit. Deposits are usually 0.25% to 10% of the purchase price. Deposits are typically made by cheque or electronic transfer with the contract. Cooling-off period Note the cooling-off period, which varies by state. It starts as soon as the contracts are exchanged and can be extended or shortened by mutual agreement. A ‘66W certificate’ can waive this period. If you withdraw during the cooling-off period, you may forfeit your deposit. Take out insurance Understand when you become responsible for the property (and any damage to it) and arrange building insurance accordingly. Responsibility timing varies by state – either at exchange or settlement. Settlement date The settlement date, specified in the sale contract, is when the sale is finalised and ownership transfers to the buyer. This typically occurs six weeks after the contract exchange but can be adjusted based on mutual agreement between the seller and buyer. Contract exchange & settlement. Things to do before exchanging contracts. Once a final sale price is agreed, the buyer and seller then sign and exchange the contract for sale. The settlement period follows, ending when the buyer pays the total sale price and receives the deed and property keys. Here are six key steps before the contract exchange: 15 1. 4. 2. 5. 3. 6.
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