Are you excited to sell your house, but dreading the paperwork and tedious process that follows? If you’re wondering what happens after you sell your house, or how long settlement takes, the reality is that every real estate transaction differs.
However, the quickest settlements tend to be the ones where the seller is well-versed in the settlement process and is on top of all the necessary paperwork right from the get-go. So to help you get a head-start on things, here’s a breakdown of what happens after you sell your house.
Step 1 – The Contract of Sale
Whether your property is sold through auction or a private sale, both parties will agree on a price for the house. Typically, the buyer is required to deposit at least 10% of the agreed price (however, this can be negotiated).
Step 2 – The “Cooling Off” Period
While this stage may sound more like something that happens after a nasty argument with your partner, it’s actually a short duration of time (usually 2-5 business days) where the contract isn’t legally binding yet. Buying/selling a house is probably the biggest transaction you’ll ever go through in your life, so it makes sense to give both parties a chance to reconsider.
Beyond that, it also allows time for the buyer to double-check things they might have forgotten to consider before the contract of sale, such as property damage, previous renovations, pest infection and so on.
Once the cooling-off period ends, the contract becomes unconditional. Every Australian State and Territory has its own real estate laws regarding the length of the cooling-off period and the penalties for breaking the agreement, so be sure to check your state’s specific laws.
Step 3 – The Settlement Period
Unfortunately, the final step of selling your house also tends to be the most strenuous, with various potential hiccups and delays as the result of technical and legal legwork. So how long does settlement take, and when can you expect to receive your settlement funds?
While 60 days is the most common duration for the average settlement, it could be anywhere from 30 to 90 days.
This might seem like a long time but in actual fact, you’ll probably find that you need this period to arrange house cleaning, landlord repairs and maintenance, various necessary documents, any renovations that are required and organise your own plans for moving out of the house into somewhere else.
Meanwhile, there’s all the “bank stuff” to sort out. The bank or lender must sign off on releasing the buyer’s home loan as payment to your sold property. From here, the buyer needs to authorise the seller (you) to collect your money from the real estate agent, who holds it in trust up to that point.
There’s usually some payment adjustments that need to be made to cater for expenditures from both parties regarding the house. The buyer can now receive the title of the property, and officially take the keys off your hands.
Need your settlement funds faster than this? There are several options available
It’s common for sellers to need the funds from the sale of their property much faster than the standard settlement period. For example, maybe you want to buy your next house and move straight into it from your current house that’s on the market.
Or it might be that you know your property could sell for a lot more if you invest in some renovations and other maintenance, along with the costs of marketing and showing your home. The conundrum might be that you don’t have the funds for these things until you’ve sold the property, putting you in a catch-22 situation.
Whatever your reasons are for needing access to your settlement funds ASAP, here are your options:
For those who are new to the concept, a bridging loan helps homeowners smoothly transition from one home to another, without having to sell the initial property first or deal with the awkward “in-between” phase of not having a home at all.
While most people typically sell their old home first and then use the available equity to purchase their next property, sometimes buying before selling is the better option. This is where bridging loans come into play, providing you with access to the funds you require to buy your new home, before you’ve sold your current one.
Rather than opting for a bridging loan (many of which have short lifespans due to the nature of the loan), a more viable solution is to apply for an advance on your settlement. A settlement advance allows home sellers to access their home’s equity from a sale early, without waiting for the funds to be released from the bank.
At RealtyAssist, we provide remarkably convenient Settlement Advances that allow you to gain access to the funds from the sale of your property as early as today.
This gives you breathing space when it comes to managing both the selling and buying processes at once. It also gives you the opportunity to secure your dream home immediately, rather than running the risk of real estate values rising after the sale of your current property and leaving you in the lurch.
Whereas many real estate advance funds providers only offer bridging loans, Realty Assist provides vendors with attractive Settlement Advance solutions that are not only fast, but deliver up to 80% of equity. This is perfect if your goal is to go to auction.
How long til I receive my settlement funds? With RealtyAssist, you can get them now
Step 1: Your house is under offer and proceeding to settlement.
Step 2: You or your broker requests a settlement advance on Realty Assist’s portal.
Step 3: We review the information required.
Step 4: We instantly pay your advance request to your chosen account.
RealtyAssist offers same-day pre-approval and funding, with no application fee and no credit mark or enquiry. We simply charge a once-off credit fee of 3.49% of your advance amount for the first 60 days*.
*Interest on overdue amounts will be charged at a rate of 1.5% of the outstanding amount payable on the 61st day, and then every 30 days after the due date.
A Settlement Advance helps you stay on top of the inevitable hidden costs that come with selling a house. For more information, give us a call on 1300 355 729 or email [email protected] and one of our friendly professionals will be happy to assist.