When you are buying or selling a property a lot of different terms can be thrown around. Here is an easy reference guide to help you through the process:
A Caveat is a legal claim lodged against a property by a person with an interest in the property. A Caveat will prevent a property from being sold or transferred unless the caveat is removed.
Certificate of Title/Title Deed
A Certificate of Title is the official document that identifies the owner of property or land. A Certificate of Title will also reference any encumbrances on the property, including existing mortgages and caveats.
The initial holding payment made when you find a property you are interested and your offer has been accepted. The holding deposit is usually paid directly to the Selling agents trust account as a promise to the Seller, but is usually refundable if you don’t proceed to enter into a Contract to purchase the property.
Exchange Date/Contract Date
The exchange date (‘Contract Date’) is the date that the counterpart contracts signed by each of the the Seller and Buyer are “exchanged”, dated and made formally binding. You are now liable to fulfil your obligations by law as stated in the Contract of Sale. This is the date that is most referred to with regards to concessions and tax related queries.
Finance (‘Pre-Approval vs. Unconditional Approval’)
Pre-approval is the stage where your bank/lender has confirm an amount you are able to borrow, based upon your financial position. Finance is not guaranteed at this point and is conditional.
Unconditional Approval is the stage where your bank has carried out all the necessary enquiries, including a valuation on the property it is taking as security, and has agreed to formally lend you the funds required for your purchase. This stage is “unconditional” because it doesn’t have any further conditions attached to it, except for the execution of documentation.
Off the Plan
An ‘Off the Plan’ property is a unit or house that has not yet been built, and you have agreed to buy based off the Developers’ plans.
The date that funds are handed over to the Selling party and the property ownership transfers from the seller to the buyer.
‘Special Conditions’ are specific terms and clauses listed in your Contract of Sale that outline the particulars of what is required from the Buyer and Seller during the Contract period. These conditions are “additional” clauses to the standard/prescribed conditions usually contained in a Contract for Sale, and are intended to address specific issues which are not covered by the standard conditions, or which are unique to your contract.
Transfer of Land
The ‘Transfer of Land’ document is a Land Title document that is lodged for registration with the Land Titles Office immediately following settlement to have the Buyer registered as the new property owner on title.