What happens when you make an offer on a property
- Securing finance
- Receiving a building inspection
- Watertightness report being completed
- Due diligence being completed by Solicitor
- Registered Valuation being completed on property
- Selling an existing property
These conditions are set out in the Sale & Purchase Agreement.
An “Unconditional Offer” is where the buyer has no conditions attached, meaning the buyer is ready to proceed immediately and is legally obligated to buy the property.
What going “Unconditional” means
Paying the deposit
Generally, when you go “Unconditional” it means you’re required to pay the deposit for the new property you’re purchasing. This is usually around 10% of the purchase price and must be paid once the agreement becomes unconditional.
If you’re planning to use your KiwiSaver funds to help cover the deposit, it’s essential that you start this process as early as possible, as this process can update up to 15 working days to complete.
Once unconditional, you’ll need to transfer the deposit to the real estate agent’s trust account, and your solicitor will manage the rest of the funds on settlement day.
Getting Preapproved for finance
If you know that you’re looking to purchase a new property, it’s a good idea to get preapproved for finance beforehand. Once you have a preapproval from the bank, this usually lasts for 3 months. If you have not found a property within these 3 months, provided your financial situation has not changed for the worse, and banks assessment criteria has not changed, you can look to get this preapproval extended for another period.
A Preapproval for finance will give a clear idea of your budget and maximum lending amount. It will also mean that when it comes time to go unconditional, you’re not rushing to sort out your finances. Instead, you’ll only need to work through a few remaining conditions with the bank to secure your finance.
