VIC Property Law - Can I Withdraw from Purchasing After Signing Contract?

[Officellama]

Good afternoon, I'm in a bit of a pickle. I have had a serious family emergency, which will keep me occupied for a while and drained my funds. I signed a contract early August and paid a 30,000 deposit. Settlement isn't until January.

Under Property Law, what can I do to get out of this, or is it impossible??

Thank you.

 

[James D. Ford - Solicitor]

Hi, normally if the Contract has gone unconditional, you will breach the Contract if you do not settle in January.

There are exceptions - mainly associated with the Seller being in breach of the Contract...

What type of purchase is it? off-the-plan or an existing property?
Are there any special conditions?
Have you conducted buyer searches on the property? have they revealed anything that would be a major issue?

If you are definitely not going to proceed with settlement... then it is best to attempt to negotiate with the seller on a "without prejudice" basis, and determine if there is an opportunity to locate a replacement buyer at the same or (if you are lucky) an increased purchase price... this could have stamp duty implications, and the real estate agent will most likely claim two commissions.. so you might incur losses, they just might be able to be limited if the matter is dealt with early... whereas if it is left to the last minute, the situation would most likely be worse, as there will be less time to deal with the situation, and the seller will most likely be under pressure from their financier to produce the settlement money.

Kind regards

 

[Officellama]

Hi, normally if the Contract has gone unconditional, you will breach the Contract if you do not settle in January.

There are exceptions - mainly associated with the Seller being in breach of the Contract...

What type of purchase is it? off-the-plan or an existing property?
Are there any special conditions?
Have you conducted buyer searches on the property? have they revealed anything that would be a major issue?

If you are definitely not going to proceed with settlement... then it is best to attempt to negotiate with the seller on a "without prejudice" basis, and determine if there is an opportunity to locate a replacement buyer at the same or (if you are lucky) an increased purchase price... this could have stamp duty implications, and the real estate agent will most likely claim two commissions.. so you might incur losses, they just might be able to be limited if the matter is dealt with early... whereas if it is left to the last minute, the situation would most likely be worse, as there will be less time to deal with the situation, and the seller will most likely be under pressure from their financier to produce the settlement money.

Kind regards, James

Hi James, It is off the plan and not built currently. Is our deposit lost? How much would the commission be that we would pay?

Thank you

 

[James D. Ford - Solicitor]

Hi, being "off-the-plan" all kinds of delays can occur...

1. have they sold all of the houses/apartments they need to obtain their financing?

2. do they have all the council approvals?

3. have they commenced construction?

Is it a house (as part of an established estate or a new estate) or apartment (and if so, how many apartments over how many levels)?

There is every chance it may not be completed by January...

It could take a lot longer to complete than originally planned.. which may give you the breathing space you need to get everything sorted to settle.

You need more information before you make any decisions.

How much was the purchase price? what percentage was the deposit?

Agents commission should be disclosed in the contracts...

Kind regards

 

[Officellama]

Hi, I purchased for 370 and paid a 30,000 deposit on the unit.

Thank you

 

[James D. Ford - Solicitor]

I cannot comment without your answers to my other questions, and your looking at your Contract (as I do not know what commission was declared as payable to the agent).

Kind regards