first home buyers
The purchase process
Remember the small point we made before? Always get your finance pre-approved; it effectively can make you a cash buyer if all your finance conditions have been met. Pre-approval generally lasts for 90-180 days, costs nothing and can easily be renewed. Once pre-approved there are a few different methods of purchase you should be
aware of.
The most common is Offer and Negotiation. A written offer is made on a sale and purchase agreement (normally through a real estate agent). It is unlikely the seller will accept your first offer if it is lower than the asking price. In most cases, negotiation results and counter-offers are made.
At Auction, you are bidding on an unconditional basis. This means you must do your homework prior to the Auction and complete builders reports, valuations, etc, if required, prior to the Auction. Generally, a deposit of 10% is payable immediately after the Auction. If the property does not sell at Auction, it is 'passed in' and interested purchasers will have the opportunity to negotiate with the vendor.
With a Tender, you place your 'best' offer in writing to the vendor who receives all offers by a set date and chooses the one they like best (a bit like a blind auction). The vendor is not obliged to choose any tender made, and may pass the property in or negotiate with the highest offer. You can place conditions on your offer but be aware the more conditions the less likely your offer will succeed. It is advisable to meet as many conditions as possible prior to Tender to make your offer attractive to the vendor - but remember unconditional is SOLD! And once unconditional you are legally bound to buy the property, if the vendor accepts your offer.
