29 Jul How Buyers Fill Out a Residential House and Land Contract
Buying property doesn’t need to be complicated. Instead of scratching your head and trying to make sense of it all, follow Henry and benefit from his useful tips and insights. In this real estate vlog he gives a step-by-step breakdown of how buyers fill out a residential house and land contract.
“Hi, I’m Henry Wong. We’re here to have a look at how to fill out a contract. So we’re making an offer on a property, 999 Kavanagh Road, Wishart. Now, this is just an example. Our names are Bob Andrew buyer and Barbara Cindy Buyer. We live at 123 Smith Road, Sunnybank. Now, we have to make sure our full names are correct, just like our passport and drivers license. Our emails, firstname.lastname@example.org and email@example.com. Our mobile number is over here. We’re looking at paying 1.15 million for the property. Our deposit is $60,000 on acceptance. With the deposit, we try to make that between five to ten percent to show sellers in good faith that we have every confidence in completing the transaction.
Now, the deposit can also be split in two ways as well. You can say, for example, I’ll pay $1,000 initial deposit followed by $59,000 unconditional. So you can also split it that way, so in total you have $60,000. But if you’re looking at making a strong deposit that is making a strong message to the sellers you want to go straight up $60,000 in acceptance, so that its straight up five percent deposit. You can go either way.
Now, with finance we have 14 days from contract date. Building and pest, seven days from contract date. Settlement, 30 days from contract date. So let’s go to the contract. Over here we have the consent to retrieve electronic communication. This just allows the buyers and sellers to email back and forth in regards to the contract and we can use email as a means of communication. So the buyer, we put our email addresses. Bob@hotmail.com, followed by firstname.lastname@example.org. Fill out our names here. Bob Andrew Buyer and Barbara Cindy Buyer. Fill out our names right here. Okay.
Next page. This is the wavier or shortening of the cooling off period. In Queensland, every buyer is entitled to five business days to change their mind. If you do decide to use this as a reason to change your mind, you have to pay a .25% of the contract price. So if you are using this right, you have to pay. It is not free. So in this case we are looking at waiving that right. So type in our names. Bob Andrew Buyer and Barbara Cindy Buyer. Type this again over here. So we are waiving our cooling off rights for the purchase of 999 Kavanagh Road, Wishart. Bob Andrew Buyer. Barbara Cindy Buyer. Okay.
So go to the next page. The contract date is the date when both parties accept. That is both buyer and seller at the agreed price and terms and conditions. This is generally the last writing that’s written. It’s generally written by the agent after the seller has accepted your offer. This is the seller’s agent details. This is the seller’s details. If they have a solicitor, they will write their details over here. If not, it will be given shortly after the contract has been executed. This is the buyer. This is our details, so we’ll fill it in. Bob Andrew Buyer and Barbara Cindy Buyer. So we live at 123 Smith Road, Sunnybank Queensland 4109. Putting in our mobile phone numbers and our email addresses.
Buyer’s agent. Now this detail is just filled in if we actually engage a buyer’s agent. That is someone to buy on our behalf, we’ll fill that in. If not, we’ll leave that empty. Buyer’s solicitor, that’s our solicitor’s contact details. So if you have already appointed a solicitor acting for yourself, the buyer, we fill that on. So the property we are looking at buying is 999 Kavanagh Road, Wishart. It’s built on. It’s the lot and plan, title reference. Land area is 650 square meters. It’s a free home, residential dwelling. It’s in Brisbane City Council. So nil excluded fixtures. There are included channels, dishwasher, but sometimes there will be more. It could be dining table, a lounge suite, pool equipment, but in this example it’s just the dishwasher.
So this is the deposit holder. The agent’s name, the deposit holder name. The bank details for the trust account. So we write in the price, $1,115,000 that we’re looking to offer. Our deposit is $60,000 on acceptance by the seller. Finance amount, so we are borrowing from the bank. So as you can see over here, 14 days from contract date. We don’t necessarily have to write the amount, so we just type in sufficient amount for the transaction. Financier, bank of buyer’s choice. Finance date, 14 days from contract date. Our building and pest, as you can see over here, is seven days from contract date.
Now, to bear in mind the finance, building and pest, and settlement date, that is all due dates of a contract must fall on a business day. So if the finance, building and pest, or contract date, if the due date falls on a Saturday the next following business day becomes a Monday. Now, if Monday is a public holiday then the next business day is a Tuesday. So just bear in mind all due dates on a contract must fall on a business day. These are matters affecting your property. That is any other easements, encompasses, or caveats it must be disclosed in here. If there are any tenants generally this is already pre-filled out by the agent. It could be the least details, so tenant’s names, terms and options, commencement, expiry, rent, bond.
Our next page is the managing agent, if it’s tenanted or if there is a managing agent these details would have already been filled out by the agent. If there is a pool, of course this would be marked accordingly. In this case we don’t have a pool. Also, if there is a pool and there is a pool safety certificate this will be filled out accordingly too. Electrical, safety switch, and smoke alarm. As you can see, according to this property they’ve already got the safety switch smoke alarms. They also have no disputes with neighbors about trees or fence.
We’ll hop on to the next page. So over here the GST withholding obligations. This is something you should talk to your accountant or lawyer about. And this is what the seller fills out, to do with the seller in regards to the GST. Special conditions. This is only filled out if you have something like subject to sell on my home or I want the seller to get a pool safety certificate done prior to settlement. So any other special conditions. Most of the time there’s nothing over here. Now settlement date. In our case it’s 30 days from contract date. So place of settlement is Brisbane.
Over here is where we sign. So there you have it. This is how you fill out the details of a contract. Now that we’ve filled out the contract we need to initial and sign the contract. So over here we see the consent to receive electronic communication. Our signature over here. I’ll just use that as an example. Obviously, today’s date, 14th of July, 2019. Now Barbara, my wife, over here as well. Signature here. Today’s date, 14th of July, 2019. We also need to initial the bottom of every page. So Bob Buyer, that’s me and my wife, Barbara Buyer. Same thing over here as well. We need to make sure that every page is initialed and in certain places we need to sign. So Bob Andrew Buyer, that’s me. Today’s date, 14th of July, 2019. My wife, Barbara Buyer, sign here. Date, 14th of July, 2019. Our initials. Bob Buyer, Barbara Buyer.
Over here. So we need to initial the bottom of every page. Bob Buyer, Barbara Buyer. The same with this page as well. Bob Buyer, Barbara Buyer. The same thing on this page, at the bottom of this page. Just making sure that every page has been initialled. There you go. Bob Buyer, Barbara Buyer. So we need to sign. Now, if this was actually done physically then you need to get a witness to sign over here. The witness must be 18 years or older. You can not witness each other, so that’s what a witness signature is. If this was done electronically, then obviously no need for that. So this is my signature over here. This is my wife Barbara over here. Our initials down at the bottom. Bob Buyer, Barbara Buyer.
Terms and conditions. Same thing. Now, just remember after the contract is executed and obviously accepted by the seller, make sure you get insurance immediately, because in Queensland the onus is on the buyer that the buyer is buying at their own risk. So just remember to get your insurance immediately, should your contract be accepted. So we’re just going through all the terms and conditions. Going through the bottom of every page and initialling the bottom of every page with our initials. Woops. There we go.
This is the last page. Now, after you’ve done all the initials and signed at the right places, we want to go all the way back and double check everything. That the signatures are signed at the right places, plus our initials are done at the bottom of every single page. So our signatures are here. The dates are here. Initials here. Look on to the next page. Initials on the bottom. Our signatures are here. Dates are here. Initials done at the bottom here. Initials done the bottom over here of this page. So back to here, this page. Initials on the bottom. Initials are done on the bottom. This page. Initials are done on the bottom. This page over here. Initials are done on the bottom. Our signatures over here. And just make sure the witness also signs. You can not witness each other. The witness must be 18 years of age or older. If this is actually done physically. If it’s done electronically, then obviously no witness is required.
So our signatures are done over here. Initials at the bottom. Now we’ll go through all our terms and conditions, making sure that the initials are done at the bottom of every single page. Done at the bottom here. Done at the bottom over here. Initials are down here. Done here. Done here. Done here. Done here. Yup. And that’s the last page. So there you go. That’s how you initial and sign the contract.”