Subject to finance

Discussion in 'The Buying & Selling Process' started by Mauve, 3rd Jun, 2020.

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  1. Ben20

    Ben20 Well-Known Member

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    If you think you can get better offer and terms from someone else, reject the offer. However, if this one is fair offer, and you haven’t received other alternate offers what’s the harm in accepting the offer? Just my opinion.
     
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  2. Mauve

    Mauve Well-Known Member

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    Thanks Ben,
    It is an off marker offer....feelers were put out when we were almost in lockdown ( I didn't advertise as I wasn't sure if a ban on open house or inspections was on its way).
     
  3. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    Oh dear - 35 days to look at a file, but think it was about 14 days if there was a contract.
     
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  4. Mauve

    Mauve Well-Known Member

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    Sorry Terry, when would it be 14 days? The 30 days the buyers are proposing starts once exchange of contract occurs. Is there something I am not understanding?
     
  5. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    If ANZ know there is a contract of sale - i.e. not a pre-approval or refinance - they will look at it quicker. 15 days as of yesterday.
     
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  6. Mauve

    Mauve Well-Known Member

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    Argh, the buyers have said 30 days or it is no deal! Even my solicitor (most of the discussions have been with the paralegal who seems to field calls for the solicitor I engaged) thinks 30 days is ok and appears to be encouraging me to sign. I am confused as I keep pushing for 14 days and they can ask for an extension if required. At least that way I have some say.
     
  7. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    ANZ will look at the file in 15 days, it doesn't mean they will issue the approval then. It might take several days for more information etc. So the buyers might actually 'need' this amount of time.

    But that doesn't mean you need to accept it.
     
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  8. Ben20

    Ben20 Well-Known Member

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    Just playing devil’s advocate. What are you going to loose if you sign the contract assuming you are happy with the price. By delaying your decision, you have already wasted 2 days.
     
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  9. Ben20

    Ben20 Well-Known Member

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    Let’s assume you had signed contract on 3rd June. The 30 days would have been 3rd of July. Now if you keep negotiating the days, and finally agreed on 14 days clause on 18th June, the end result would be same. If you do not have any other prospective buyer, I don’t see you have anything to loose.
     
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  10. KateAshmor

    KateAshmor Victorian Conveyancing Lawyer Business Member

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    We are advising all our purchaser clients to include a 21 day subject to finance clause. Most lenders seem to need about 16-18 days to issue unconditional approval, but it depends on the nature of the loan and the property.

    There’s no point insisting on a 7-14 day clause, when the purchaser will need an extension.
     
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  11. charli

    charli Member

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    yep I agree if the buyer needs 30 days then that's ok, I am sure they would like finance as soon as possible as well. Think they are just giving themselves some coverage incase banks don't pick up file early. We have been told to ask for 45 days finance with option to bring date forward once approved.
     
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  12. jaydee

    jaydee Well-Known Member

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    Why not accept the offer but include a 48 hour clause? In WA the 48hr clause allows the agent to continue marketing the property and if another offer is made on the property, the 48hr clause can be enacted which then gives the purchaser 48hours to make their offer unconditional or the contract fails.

    It used to be fairly standard when purchasers made offers subject to the sale of another house.
     
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  13. Lindsay_W

    Lindsay_W Well-Known Member

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    Surely you mean 45 day settlement clause - never seen a finance clause that long, 21 days is plenty, only Westpac taking slightly longer than that.
     
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  14. charli

    charli Member

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    Nope it was 45 day finance and 60 for settlement. Broker asked to push all out as far as possible, said that they taking time to pick up file, then often requiring more info. He said to have option to go unconditional and settle earlier if we had approval before time. This was with ANZ. Broker is currently looking at other lenders with faster turn around times.
     
  15. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

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    ANZ is pretty yuck

    15 working days to pick file

    7 days for additional docs ( getting a one pass loan approval is like fuel under a dollar)

    That be business days and the above is for purchases

    For refis............. ANZ are working on filed lodged around 25 May :(

    ta
    rolf
     
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  16. Lindsay_W

    Lindsay_W Well-Known Member

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    My experience recently, have 2 in the normal resi pipeline at the moment, took 17 business days for the purchase to get picked up, the refinance is going on 25 business days do far, another 2 weeks before it will be looked at. Both deals qualify for the LMI waiver which is why ANZ.
    Had another refi that was picked up in 7 business days - via ANZ Health though ;)
     
    Last edited: 4th Jul, 2020
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  17. Lindsay_W

    Lindsay_W Well-Known Member

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    Sounds odd to me, 45 days finance and 60 days settlement - sounds like your broker is being extra cautious which isn't a bad thing but there's a risk the seller of the property may not agree to such terms and go with someone else's offer. Unless there's a specific reason to go with ANZ (eg 90% No LMI policy) then I wouldn't touch em at the moment.
     
  18. Mauve

    Mauve Well-Known Member

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    Thanks everyone for your replies. After initially thinking I wouldn't agree to the 30 day finance clause and after trying to push back, I eventually agreed (was more like 28 days by the time I signed). The outcome?.....The buyer has asked for an extension. The request is only for an additional four days...but who knows how many more extenations they may ask for if I agree to this one.
     
    Last edited: 5th Jul, 2020
  19. swin87

    swin87 Member

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    Hi there - I just had a question as a buyer. What if I have put "Subject to Finance till xx/xx/2020" which is actually 14 days from the contract date and I can't get finance within those 14 days. Can I get out of it or does it become unconditional and I can't get out of it?

    I know I will have to pay some fees like 0.2% of purchase price OR $100 which is greater, if I decide to get out of the contract.
     
  20. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    Very poorly worded. Open to various interpretations.
     
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