Consumers can no longer use the finance clause in their sale-and-purchase agreement to pull out of a property purchase.
Up to now, consumers were not required to provide evidence they couldn’t raise finance, meaning they could easily pull out of a conditional offer. But with the recent launch of the 10th edition of the REINZ/ADLS Agreement for Sale and Purchase, they will need to provide a letter or email from the lender stating that the mortgage application has been declined.
“This is a significant change to the sale and purchase agreement and it’s imperative that consumers understand the implications as if they can’t provide evidence they can’t raise the finance, they could be forced to proceed with the purchase or face other legal action by the vendor,” said REINZ chief executive, Bindi Norwell.
The new sale and purchase agreement also includes new definitions, warranties and clauses, as well as clarification on the timeframe in which deposits may be released.
Once again, it’s very important that buyers seek legal and mortgage advice before, during and after their property purchase. Getting their finance sorted is key, and can help them avoid a rather unpleasant mistake. Our Mortgage Link advisers are experts in their field; please don’t hesitate to contact us if we can be of assistance.
To get in touch with the team at Mortgage Link, please contact:
021 835 506
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