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Understanding finance clauses on a contract of sale is crucial for anyone buying or selling property.

These clauses can impact your ability to secure financing and influence the success of the transaction.

This guide will help you navigate these clauses, explain their significance, and ensure you’re fully informed about your financial obligations and rights during the sale process.

Being well-versed in these aspects can lead to a smoother and more confident property transaction.

Do I need a finance clause when buying or selling property in Queensland?

Yes, including a finance clause in your contract of sale is highly recommended when buying or selling property in Queensland. A finance clause, often referred to as a “subject to finance” clause, provides a safeguard for buyers who need to secure a loan to complete the purchase. This clause stipulates that the contract is conditional upon the buyer obtaining finance approval by a specified date.

For buyers, the finance clause protects you from being legally obligated to complete the purchase if you are unable to secure financing. This means you can cancel or terminate the contract and recover any deposits paid if your loan application is not approved by the set due date.

For sellers, including a finance clause can attract more potential buyers who may require a loan to buy the property. It ensures that the sale process is transparent and sets clear expectations regarding the buyer’s financial obligations.

What does “subject to finance” mean on a contract?

If you are in the process of buying a home and are under contract, one of the conditions might be “subject to finance”.

This means that if the Buyer does not obtain financial approval by a set due date, they can cancel or terminate the contract and recover any deposits paid.

A contract will usually be subject to finance if any portion of funds are needed to cover the purchase price of a property.

These required funds indicate a need for a loan.

In Queensland, to make your contract subject to finance, you will be required to submit a finance amount, financier and finance date that must be sufficiently met to execute a contract.

Once a Buyer obtains formal approval from a lender or bank, they are able to satisfy the Finance Condition and the contract becomes unconditional.

What is the difference between conditionally approved finance and unconditionally approved finance from your lender? (not to be confused with an unconditional contract of sale)

On a typical contract of sale where the buyer is financing, there are two stages of approval:

conditionally approved
unconditionally approved finance

Being conditionally approved is the first stage, where the lender has tentatively approved the loan.

However, certain conditions need to be met before the final approval is granted, such as providing additional documentation or fulfilling specific requirements (like waiting for a property to register, or signing a Contract to sell your current residence).

When these obligations are met, the finance is unconditionally approved.

Unconditionally approved finance means that all of the bank’s conditions have been met, and the loan is fully approved by the lender, subject only to the completion of the contract sale.

You will then need to make a decision if you are happy with the loan you have been offered and whether you wish to proceed with the Contract of Sale.

If you are happy to proceed, you must notify your solicitor, in writing, that you are satisfied with your Financing.

It is not enough to simply be approved by the bank, your property Contract has its own conditions with due dates that need to be manually satisfied.

Need assistance with a contract of sale?

If you need assistance with understanding or finalising a contract of sale, contact our expert conveyancing team at Stanford Legal.

Book a free consultation today to ensure your property transaction proceeds smoothly and confidently.

Whether you’re navigating a conveyancing process or considering a property purchase, it’s essential to understand the differences between Tenancy in Common and Joint Tenancy.

Knowing the definitions, implications, and benefits of each ownership structure can help you make informed decisions, protect your investment, and ensure smooth property transactions.

This guide will provide you with key insights into these co-ownership arrangements, helping you choose the best option for your specific needs and circumstances.

What does “joint tenants” mean?

Joint tenancy (joint tenants) refers to a co-ownership, where two registered owners of a property share a 50/50 split in the interest (ownership) of the land. When you buy a house, to finalise the legal proceedings, you will have to elect how you and your co-owner would like to hold the property. What distinguishes joint tenancy, is that if one of the registered title holders passes away, their share automatically transfers to the surviving joint tenant. This is known as a “right of survivorship”, where the mortgage on a home is transferred based on the co-ownership agreement on the title.

What does “tenants in common” mean?

Tenancy in common (tenants in common) is the other form of co-ownership over a property. However, unlike joint tenants which requires an equal half split, the two registered title owners can decide to split their interest in the land to be weighted in favour of either person. For example, two property owners can have any share of the property (10/90, 30/70, etc.). Similarly to joint tenancy, the share can be an equal split of 50/50 as well. The key difference regarding tenants in common is that if there is a death of one of the owners, their share or interest of the land is decided according to according to their will.

This means that rather than the sole survivor having full ownership of a property, they are still only entitled to their original portion, with the beneficiaries of the deceased usually holding their previous co-owners share. These beneficiaries can inherit, sell or transfer their share.

Is Joint Tenants or Tenants in Common better for me?

To understand which ownership is best for you, it is important to understand the advantages and disadvantages of each option. Keep in mind that you can always change the tenancy from joint tenants to tenants in common (or vice versa) after taking possession of the title on a land registry. However, there may be registration fees involved

Joint Tenant Advantages

Right of survivorship – If one of the owners dies, their share automatically transfers to the surviving owner(s) without going through probate (a long legal procedure validating a deceased person’s will in the Supreme Court). This is very common for couples.
Shared responsibility – All of the owners possess equal responsibility and rights for the property, including maintenance and taxes.
Simplicity – Joint tenancy is the most common ownership agreement and is relatively straightforward to establish and maintain.

Joint Tenant Disadvantages

Finite control – Each owner cannot independently sell or mortgage their share without the agreement of the other owner(s).
Potential conflict – Disagreements among owners, or separations, can arise regarding decisions related to the estate and lead to divisions of the property. In cases of a divorce, the tenants often require division by agreement, where typically one spouse will have to buy out the other’s share or sell the property and split the shares.
Equal ownership – The ownership shares are equal, regardless of financial contributions, investments, or maintenance efforts.

Tenants In Common Advantages

Flexibility – Owners can hold an unequal divided share of the property based on their financial contributions or agreements.
Individual control – Each owner possesses the right to sell, mortgage, or transfer their share without requiring the consent of the other owner(s).
Estate planning – Owners can specify their share to pass to their chosen beneficiaries through their will.

Tenants In Common Disadvantages

No right of survivorship – There is no automatic transfer of ownership to the remaining owners, and the deceased owner’s share passes according to intestacy laws or their will.
Probate – In the circumstances of an owner’s death, their share would become subject to probate which causes a major delay in the distribution of their assets and estate. The value of their share can also be subject to inheritance tax if it exceeds certain thresholds set by taxation authorities.
Potential conflict – In many cases, disagreements among owners may arise regarding the estate and will decisions. Similarly to joint tenancy, in cases of a divorce, the tenants often require division by agreement, where typically one spouse will have to buy out the other’s share or sell the property and split the shares.

Key Takeaways?

Joint tenancy is defined as an ownership of property with an equal share of land and right of survivorship where the death of an owner automatically transfers their share to the surviving owner. The definition of tenancy in common is the ownership of any share of land with no right of survivorship, where the death of an owner transfers their share according to their will.

When understanding rights inter se, as well as balancing the pros and cons, there is no “right” answer, as everyone’s ownership situation is different. It is important to acknowledge each owner’s financial contribution and maintenance exertion before coming to a title agreement.

It is also important to remember that the ownership title deed can always be transferred or amended, no matter the length of the tenure. This means the decision you make can always be changed in future if all owners consent.

Need Guidance on Property Ownership and Title Deeds?

Understanding the nuances between joint tenancy and tenancy in common is crucial for making informed decisions about property ownership.

If you need guidance on which ownership structure is best for you or assistance with amending your title deed, contact our expert conveyancing team at Stanford Legal.

Book a free consultation today to ensure your property ownership aligns with your needs and future plans.

In Australia, yes, it is legally possible to finalise your divorce before completing the property settlement; however, this approach requires careful consideration of the potential consequences and benefits.

Understanding Divorce and Property Settlement

Divorce

Divorce is the dissolution of a marriage by a court. Once granted, it officially ends the personal relationship between spouses.

In Australia, a divorce can be applied for only after a mandatory separation period of 12 months.

When the parties have lived separately and apart for 12 months the court accepts that fact as evidence that the marriage has irretrievably broken down.

Irretrievable breakdown has been the sole ground for divorce in Australia since 1976.

Property Settlement

Property settlement, on the other hand, involves the distribution of assets and liabilities between the spouses following the breakdown of their marriage or de facto relationship.

Real estate, investments, savings, and debts belonging to the parties are divided between them in this process.

The goal of a property settlement is to achieve a fair and equitable division as per the Family Law Act 1975, considering various factors like the property available for distribution, the duration of the marriage, contributions by each party, future needs of the parties and fair and equitable considerations.

How Divorce and Property Settlement Typically Interact

Divorce is a stand-alone proceeding either by way of a single or joint application to the court.

The only requirement to be eligible to apply is that the parties have to be separated for 12 months.

Once a divorce order is granted by the Registrar, there is a cooling off period of 30 days after which the order becomes final.

Spouses can begin property settlement negotiations as soon as they decide to separate and can finalise these arrangements any time before or after the divorce is granted.

However, once the divorce is finalised, parties have a time limit of 12 months to initiate property settlement proceedings if no agreement has been reached earlier.

Failing to meet this deadline will result in permission or leave having to be obtained from the court to make an application out of time.

It is important to manage the timing of both processes, as decisions in one area can significantly impact outcomes in the other.

Advantages and Disadvantages Of Divorce Before Property Settlement

Advantages:

Speed and Closure: Finalising a divorce before settling property can sometimes expedite the emotional closure from the marriage, allowing individuals to move forward.
Simplicity in Certain Cases: For couples without significant shared assets or where prenuptial agreements are in place, finalising the divorce first might simplify the proceedings.

Disadvantages:

Financial Uncertainty: Completing the divorce before property settlement may lead to financial uncertainty. Without a formal settlement, one party may find it difficult to make long-term financial plans, as the distribution of assets remains undecided.
Legal Complications: There is a risk of legal complications if the property settlement is delayed until after the divorce. For example, if one spouse’s financial situation changes dramatically post-divorce, it could affect the fairness and outcome of the settlement.
Time Pressure: The 12-month time limit to initiate property settlement proceedings after divorce adds pressure and may force parties to settle hastily or inadequately.

Choosing whether to divorce before settling property should be done with consideration of these factors, ideally with guidance from a legal professional.

In our experience having a property settlement first is a safer option.

Ready to start the divorce process? Find out how to get a divorce in Australia.

Benefits of Completing Property Settlement Before Divorce

Although you can choose to divorce before property settlement, you may choose to settle property issues before finalising the divorce.

This invariably simplifies the process as there is no pressure of having to race against time to get a settlement done before the time limit.

Getting divorced first compels parties to rush to court to preserve the limitation date.

It can also provide:

Clarity and Certainty: Resolving financial issues early provides both parties with clarity and certainty about their financial futures, which can reduce stress and conflict during divorce proceedings.
Emotional Relief: Finalising the financial aspects early in the separation process can provide emotional relief, allowing both parties to move forward and focus on adjusting to their new lives separately.

Completing property settlement before the divorce can often reduce the likelihood of prolonged disputes and emotional stress.

Property Settlement After Divorce: Time Limit

Limitation Date

After a divorce is finalised in Australia, there is a strict statutory time limit within which former spouses must initiate property settlement proceedings

You have 12 months from the date your divorce becomes final to finalise a property settlement by consent or commence proceedings.

Failing to meet this deadline will result in having to first obtain the leave or permission of the Court to issue proceedings out of time.

Such leave is granted sparingly and subject to the discretion of the Court.

Extensions and Exceptions

There are certain circumstances under which the standard time limits for initiating property settlement proceedings may be extended or exceptions applied. These include:

Hardship: If you can demonstrate that failing to extend the time limit would cause you or a child significant financial hardship, the court may consider granting an extension.
Consent of Parties: Both parties can agree to extend the time limit by signing a formal agreement. This is typically handled by legal representatives to ensure that the extension is legally binding.
Court Discretion: The court has the discretion to allow an application outside the usual time limits if it believes it is just and equitable to do so. This usually requires proving that exceptional circumstances prevented an earlier application.

These exceptions are not granted lightly, and the burden of proof lies with the person seeking the extension. It’s advisable to initiate property settlement proceedings well within the standard time limits to avoid the complexity and uncertainty of seeking an extension.

How to Navigate Property Settlement Efficiently

Seeking Legal Advice

Consulting with a legal professional is crucial during both the divorce and property settlement processes.

A legal expert can provide essential guidance on your rights and obligations, help you understand family law, and ensure that all legal documents are correctly prepared and submitted.

Legal advice is invaluable for making informed decisions.

Whether you’re facing the initial stages of a divorce or you’re deep into property settlement negotiations, the right legal assistance can make all the difference.

Contact Stanford Legal for expert advice and representation.

Our experienced family law team are ready to guide you through every step.

Book a free consultation today to learn more about how we can help!

From understanding the significance of these conditions to navigating the process seamlessly in conveyancing, it’s crucial to be well-informed about building and pest conditions and reports in QLD real estate transactions.

This guide covers critical aspects, helping you identify potential issues, negotiate effectively, and ensure a smooth property sale or purchase.

Whether you’re a buyer or seller, knowing these details can protect your investment and facilitate a successful transaction.

What is a building and pest condition on a contract?

A building and pest clause in a standard contract gives a buyer the opportunity to have a building and pest inspection conducted to ensure the property is in a condition acceptable to them. It is the buyer’s responsibility to obtain quotes and engage a Building and/or Pest Inspector they are happy with. In some instances, you can hire a Building Inspector and a Pest Inspector separately.

Any inspection must be conducted by a Licensed Inspector, and it is preferable that a written report be provided.

Once the buyer receives their building and pest report, under the standard terms of an REIQ contract, they have two options:

Accept the property in its current condition; or
Terminate the contract on the basis that they are not happy with the current condition of the property.

However, in the spirit of keeping the contract going, a buyer may choose to request that the Seller fix certain items of concern, or alternatively, negotiate a price reduction.

It is important to note that the Seller is under no obligation to enter into any negotiations of this type, and it is their choice entirely as to whether they engage in the process. There is nothing in the contract that forces a seller to negotiate.

What is a building and pest report?

A building and pest inspection is a comprehensive assessment of a property’s condition and structural soundness conducted by qualified professionals.

This ensures that the property you would be purchasing is structurally maintained and that there are no pest concerns.

Depending on who is hired to perform the inspection, each building and/or pest report is written differently, however, they all assess the same aspects of a property. These inspections usually include:

Visual inspections of the building/s
Roof systems (internal and external)
Bedrooms
Rooms
Bathrooms
Kitchen
Laundry
Toilets
Exterior
Footings
Garaging
Site
Services
+ more

The assessor will highlight building materials, conditions and defects and whether such defects are major or minor for all these areas, as well as attaching required photographs and comments. Near the conclusion of the report, the assessor will typically mention any recommended actions to take for any renovations, repairs or rectification that is or may be needed.

Please note there are other specific types of inspections available in addition to the above being:

Thermal and Infrared for suspected moisture readings; or
Illicit drug residue using laboratory testing and/or service dogs; or
Asbestos

You would need to engage specific qualified inspectors to conduct these types of inspections.

The report will also outline the possibility of a pest infestation. Termites are typically the most common pests discovered in building and pest inspections; however other rodents might create issues to be considered by potential buyers. Cockroaches, mice, rats and other rodents are examples of pests that commonly reside in dwellings.

Why is a building and pest condition important?

Being one of the conditions that is commonly used in a standard purchase of a property, it is the buyer’s responsibility to arrange a qualified inspector to conduct the search. The buyer then needs to consider whether to continue with the sale or terminate the contract. The report provides crucial information, identifying any underlying structural issues, damage from pests or other problems that might not have been mentioned or visible during a regular inspection.

Should the contract already be signed, terminating through an unsatisfactory building and pest report is a valid termination and can be done without a penalty unlike the “cooling off” penalty – which can be thousands of dollars. Once all other conditions are met (including deposits, finance and special conditions), the contract goes unconditional, where there is no further right of termination of the contract, unless another party fails settlement.

Therefore, it is vital that you are completely satisfied with the building and pest report before satisfying the condition.

Who pays for building and pest reports?

As a buyer, it is your responsibility to arrange for a qualified professional to conduct the building and pest inspection. You have the option of getting a referral from your real estate agent, but it is always good to do your own research and find the best inspector for you.

As the buyer is responsible for arranging the inspection, they will also incur any costs of the assessment. Each company varies in price, so it’s good to get multiple quotes to ensure you are confident you are getting a good price. This cost will be invoiced directly to you around the time of the inspection and is not payable as part of the fees for the purchase of the property and stamp duty etc.

What can I do if I’m not happy with the results of my building and pest report?

As a buyer, if you receive your building and pest report, and are unsatisfied with any of the findings, under the terms of the contract, you have the right to terminate the contract or continue and satisfy the clause. You may choose to request for items to be fixed or a price reduction, however as noted above, the Seller is not obliged to enter into these negotiations.

Key Takeaways

Building and pest conditions are essential for ensuring the property is in acceptable condition before finalising the purchase.
It is the buyer’s duty to obtain and review the building and pest inspection, conducted by a licensed inspector.
Buyers can accept the property as is, request repairs or price reductions, or terminate the contract based on the inspection report.
Inspections cover structural soundness, pest infestations, and recommend necessary repairs or actions.
The buyer is responsible for arranging and paying for the building and pest inspection.
Sellers are not obligated to negotiate or make repairs based on the inspection findings.
Ensuring satisfaction with the report before finalising the contract is crucial to avoid penalties or future issues.

Are you buying or selling a property?

Our experienced Ipswich conveyancing team is here to help. We offer expert guidance to navigate the complexities of property transactions, ensuring a smooth and hassle-free process.

Divorce is a significant life event that brings about change and uncertainty and a lot of the time, you won’t even completely understand how to get a divorce. At Stanford Legal, your collaborative legal team, we understand these personal and emotional complexities, particularly for spouses with children.

We’re here to make the legal aspects of divorce clear and manageable, offering reassurance and guidance every step of the way. Our approach is centred on providing compassionate, tailored advice to help you move forward with confidence, knowing your interests are protected and your voice is heard.

What is considered a divorce in Australia?

The decision to end a marriage isn’t made lightly, and the process reflects the need for careful consideration. In Australia, the main requirement for a divorce is the irretrievable breakdown of the marriage, evidenced by a 12-month separation. This separation demonstrates to the courts that reconciliation isn’t expected. Even if you continue to reside under one roof for practical reasons, the separation is valid with the right documentation. Stanford Legal is adept at navigating these requirements and will help you compile the necessary evidence, treating your circumstances with the respect and discretion they deserve.

Preparation before applying for a divorce

As you consider the prospect of divorce, being thoroughly prepared can provide a sense of control during an emotional time. The path to divorce begins with preparation, both legally and mentally. At Stanford Legal, we recommend collating important documents like your marriage certificate and financial records before starting the application, but understanding the emotional journey is just as critical as the paperwork.

You will need the following documents and information to start your divorce application:

Identification

A valid form of identification for both parties.

Marriage Certificate

An original or a court-certified copy of your marriage certificate.

Citizenship Documents

If you or your spouse were not born in Australia, provide evidence of citizenship, visa, or residency status.

Details of the Separation

Including the date and arrangements during the separation period, especially if you have still been living together under the same roof.

Financial Records

Comprehensive details of income, assets, and debts.

Parenting Arrangements

If applicable, a parenting plan or evidence of the current arrangements for the care of children.

Our team of family lawyers stands ready to support you through your divorce, ensuring that you feel educated and empowered for the process ahead. We’re committed to offering clear and straightforward guidance, making sure that you’re not only prepared on paper but also thoroughly understand what you are entitled to and the impact of the decisions you make.

The Application Process

Navigating the application process for divorce can seem daunting, but with step-by-step guidance, it becomes manageable. Here’s a simplified overview:

Filing the Application

Complete the divorce application form, ensuring all details are accurate and the grounds for divorce are clearly stated.

Submitting Documents

Along with your application, submit all required documents to the court.

Serving the Application

If filing a sole application, legally provide (serve) the other party with the application and supporting documents.

Court Hearing

Attend the hearing, where the details of your application will be reviewed.

Outcome

If the court is satisfied, they will issue a divorce order, which becomes final after one month and one day.

Throughout this process, having Stanford Legal by your side means you have guidance that protects you and steers you towards the best possible outcome.

Child custody and support during a divorce

At Stanford legal, when children are part of the divorce equation, their wellbeing becomes our central focus. Our approach to child custody and support matters is always infused with compassion and a commitment to achieving stability and security for the young lives affected.

Our role is to guide you through these sensitive matters, ensuring decisions are made that reflect the best interest of your children and your rights as a parent.

Property and financial settlements

Resolving property and financial matters is a crucial step towards a new beginning. The aim is to reach a settlement that is fair and just for both parties, considering the unique circumstances of your relationship. Assets and debts are carefully assessed, which includes everything you’ve both acquired, from real estate to superannuation, investments, and personal belongings, as well as any debts.

At Stanford Legal, we believe in a fair and equitable division that respects the contributions each person has made and the future needs of both parties. We understand that fair doesn’t always mean equal, but what’s just and equitable for your specific situation.

Finalising the divorce

Your divorce becomes final when the court issues a Divorce Order. This occurs one month and one day after your divorce hearing, provided the judge has granted the divorce.

This legal decree is significant—it means you are no longer married and are free to remarry if you choose.

Moving Forward with Confidence

As you move beyond divorce, know that Stanford Legal remains at your side. Our commitment to guiding you through the transition is steadfast, grounded in our values of empathy, education, and empowerment. We provide ongoing support, advice, and counsel as you navigate the post-divorce landscape, particularly in updating your Will, ensuring that you do so with confidence and clarity.

If you seek a compassionate partner to guide you with personalised legal support, our team is here to help you forward. Reach out to us to find out how we can assist you in moving forward with confidence, empowered with the knowledge that comes from empathetic legal guidance and education.