Wednesday, July 6, 2011

Finance Approval Expiry

While providing pre-purchase legal advice to a client during their cooling off period this morning we noted that the settlement period was nearly 12 months.

The client was not aware that their finance approval would not last for such a long period of time, and that they may find that they are locked into a contract they can't fulfill if circumstances change and they can't access finance.

To make matters worse, the real estate agent had drafted the contract with a 20% deposit requirement, and a special condition stating that the deposit must be released early.  All kinds of legal arguments will come into this one!

Needless to say, our advice will be to cool off, and renegotiate the purchase!

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