Right now most of Australia is in a seller market. This means that owners have the upper hand. Because of this, it’s common for buyers to offer unconditional contracts.

In today’s video we uncover the 7 massive risks associated with buying with an unconditional contract, so keep watching.

00:00 WATCH THIS before making an offer on a house
00:23 Are conveyancing searches necessary?
02:00 Building & Pest Inspection
03:23 Bank valuations
04:38 Lenders Mortgage Insurance Declined
05:14 The cost of unconditional offers
06:04 7 Commonly Asked Questions
06:06 What is an unconditional contract of sale?
06:20 What happens when a contract goes unconditional?
06:42 Can I get my deposit back if I change my mind once unconditional?
06:57 What is the cooling off and finance period?
07:42 Can I get out of a contract I just signed?
08:14 What is the difference between a conveyancer and a solicitor?

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7 Commonly Asked Questions

What is an unconditional contract of sale?
This is an offer where by the buyer waives all their rights. This means they buy the property no matter what and the offer isn’t subject to anything, not finance, building and pest, or any other conditions.

What happens when a contract goes unconditional?
It essentially means that both parties were locked into the agreement, no matter what. So, if either party wants to leave the agreement, then legal consequences can be enforced based on the contract terms. For property this means either penalty interest or damages being charged to the person in default.

Can I get my deposit back if I change my mind once unconditional?
Short answer, no. Once you’re unconditional you’re locked in and if you look to pull out of the contract, the owner can and will press charges for breaking the agreement.

What is the cooling off and finance period?
In Queensland, contracts typically have both a cooling off and finance period.The period allows buyers 5 business days to terminate their contract, if they do so a 0.25% penalty fee for termination will be payable to the owner.

With a finance clause it means that the buyer is able to terminate their contract within the agreed timeframes and exit the contract with no penalty. So for example if you’ve a 14 day finance clause, and your bank doesn’t approve your application, then so long as you notify the seller within the 14 days, you can exit the contract without penalty.

It’s common for these periods to be extended if your bank or lender doesn’t approve your home loan in time.

Can I get out of a contract I just signed?
It depends on the contract you’ve signed. If the contract is subject to cooling off, then yes. You’ll be able to exit the contract so long as still within the cooling off period. But as mentioned previously, you may be charged a fee for doing so.

On the other hand if you’ve signed a contract which is unconditional and has waived your cooling off period, then you might be locked into the contract and unable to exit.

It’s always recommended that you seek legal advice before signing any contract to know 100% what you’re committing to.

What is the difference between a conveyancer and a solicitor?
A conveyancer is a property specialist and able to help with title transfer. They typically only deal with helping people complete searches and settlements on property. Think of them as a specialist. But they aren’t a fully qualified legal practitioner, on the other hand a solicitor is.

This means they’re able to offer much more insight on property law, taxation and other legal matters. For the vast majority of people a conveyancer will be more than sufficient to assist. A solicitor would be recommended for those who are looking to purchase in the name of a trust or company, or have a non-standard purchase agreement with many moving parts.

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