Synopsis: On the settlement date, if you do not have the necessary funds in your savings account, you may face penalties and lose your deposit. To avoid this problem, you must ensure that you have funds to cover the various fees and taxes related to a home purchase. You should also consider transferring money to a trust account when paying in cash.
When the settlement date comes, you need to have the necessary funds in your account. Failure to do so may result in penalties and the loss of your deposit. In Brisbane, the seller even has the right to sue for damages. If you want to avoid these issues, use these tips to ensure that you have funds ready on your settlement date.
Include Funds for Fees and Taxes
Solicitors do everything in their power to ensure that clients are prepared for the settlement date. However, it is ultimately up to the buyer to make sure that their affairs are in order and that they have the correct funds in their account.
As there are many costs associated with buying a home, buyers may overlook the various fees and taxes that need to be paid. Talk to your broker or bank about including the cost of these fees and taxes in your mortgage so that you have the necessary funds in your savings account.
These fees and taxes include the stamp duty tax, building fees, title insurance, bank registration fees, strata report fees, water fees, and legal fees.
Transfer Funds to a Trust Account
Your conveyancing solicitor may assist you with transferring funds into a trust account managed by the solicitor. This is a common option for those who plan to pay cash for their home purchase. You may even transfer the funds in stages ahead of the settlement date to ensure that they are available.
Ask Your Solicitor for Assistance
Along with these tips, you should talk to your solicitor about the settlement process. Ensure that you are fully aware of all the fees that you are required to pay. Solicitors from River City Conveyancing can help walk you through the settlement process and explain the various costs.
If your mortgage does not include funds to cover the cost of the various taxes and fees, then you need to begin saving for these costs. Your solicitor can help estimate the costs so that you have a figure to save towards.
Buying a home is a major purchase. To ensure that everything goes smoothly, you need to properly plan for the settlement date. Remember to verify the total cost and determine how much money you need in your account. You should also stick to a budget and avoid spending more than necessary.