Guides, Insights

Can I cancel my contract?

KDD Cancel Contract

With the property market being more in demand than ever, you may feel pressured to secure your home as soon as possible. But what steps should you take before locking in to a contract?

MAKE SURE TO DO YOUR HOMEWORK ON THE PROPERTY

Western Australia does not have a cooling-off period for buyers, so it is crucial that you exercise due diligence before you proceed with an offer. If there are certain conditions that you’d like included in your offer (such as checking for structural flaws or pest infestation), speaking to your conveyancer should be your first step. 

Your conveyancer can help guide you on what conditions should be included in your offer and help explain any annexures that have been included in the contract to you. Your real estate agent can also help you negotiate with the seller to have inspections done on potential risks before you place your offer, or include conditions in your offer that allow you to have these inspections completed before settlement. Involving a conveyancer early can let you make an informed decision on the state of a property.

Western Australia does not have a mandatory cooling-off period, so make sure you have done your due diligence on a property is key.

WAYS YOUR CONTRACT MIGHT COME TO AN END

Even once an offer has been accepted and a contract drawn up, there are still ways that your contract may come to an end.

  • Receiving a finance decline from your bank in accordance with the terms of the contract
  • The seller choosing not to remedy structure defects in accordance with the structural inspection condition of the contract 
  • Mutual agreement if both parties decide to end the contract (a rare occurrence, and shouldn’t be relied on)

In the event that one of these applies, there are certain timeframes and requirements that must be met for the contract to be cancelled. If these requirements are not met, you may lose the right to cancel the contract or forfeit your deposit. Your conveyancer will be able to guide you through these specifics and ensure a smooth transition.

WHO GETS TO KEEP THE DEPOSIT IF A CONTRACT IS TERMINATED?

When a buyer agrees to purchase a property, the deposit they pay is held in a trust account with the real estate agent or the sellers’ solicitor. The deposit is only released after settlement has occurred. 

If a contract is terminated prior to settlement, the terms of the contract will decide what happens to this deposit. If the contract is validly terminated by the buyer (e.g. finance was declined) and the decline letter adheres to the requirements of the contract, the buyer’s deposit will be returned in full. 

In the event that a contract is not validly terminated (e.g. the buyer changes their mind and withdraws from the offer without the seller’s agreement), the seller may be able to claim their deposit either in part or in full. There are other remedies available to the seller if the buyer does not proceed with the contract, including the ability to sue the buyer if they re-sell the property for a lesser price in the future.

Make sure you speak to your conveyancer about the specifics of your contract to ensure you can protect yourself and your deposit. 

NEED ANY EXTRA HELP?

Getting into a property contract is a big decision, and having the right team beside you is the first step to success. Let KDD help you succeed in all your property transactions:

  • We’re licensed professionals.
  • As a business, we have two decades of experience in conveyancing, and our team has over 150 years’ collective experience.
  • We are caring about getting the best outcomes for our customers, whether you’re a property buyer or seller.
  • Every team member was handpicked for their career achievements, passion, and great personality.
  • We are active and innovative thought leaders who are grateful to be recognised by our peers and industry associations with multiple industry awards.
  • We are entrepreneurial in bringing breakthrough proptech to our fellow conveyancers, with the vision of making things easier, faster, and safer for all parties in the property ecosystem.  

Let our experienced property conveyancing practitioners at KDD Conveyancing Perth assist you. Our friendly and knowledgeable conveyancers.