Cooling Off, Finance, Building & Pest
3 most common clauses on a residential Contract. Do you know what they are?
1. The Cooling Off Period
Once a contract is signed and dated after both seller and buyer agree on price and terms, a 5 business day cooling off period begins. This ends at 5pm on the fifth business day. This time allows for the buyer to withdraw from the contract at anytime, however, if this happens, the seller may choose to keep part of the buyers deposit. The termination penalty is 0.25% of the contract sale price. The cooling off period can be waived by giving the seller or sellers agent a PAM
2. Finance
An agreed upon amount of days between a buyer and seller where the contract is subject to the buyer being approved for finance. Usually around 14-21 calendar days from signing and extensions to this time can be requested. In this time frame the buyer must inform the seller or sellers agent that their financial institution has approved their loan. If approval is not met by the deadline date then the contract becomes invalid.
3. Building and Pest
This works in the same way as subject to finance. Agreed upon time frame in which the buyer is to get a Building and Pest Inspection carried out by a qualified inspector. This inspection is optional but highly recommended.
1. The Cooling Off Period
Once a contract is signed and dated after both seller and buyer agree on price and terms, a 5 business day cooling off period begins. This ends at 5pm on the fifth business day. This time allows for the buyer to withdraw from the contract at anytime, however, if this happens, the seller may choose to keep part of the buyers deposit. The termination penalty is 0.25% of the contract sale price. The cooling off period can be waived by giving the seller or sellers agent a PAM
2. Finance
An agreed upon amount of days between a buyer and seller where the contract is subject to the buyer being approved for finance. Usually around 14-21 calendar days from signing and extensions to this time can be requested. In this time frame the buyer must inform the seller or sellers agent that their financial institution has approved their loan. If approval is not met by the deadline date then the contract becomes invalid.
3. Building and Pest
This works in the same way as subject to finance. Agreed upon time frame in which the buyer is to get a Building and Pest Inspection carried out by a qualified inspector. This inspection is optional but highly recommended.
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