What is a Terms Contract?
A terms contract enables a buyer to move into the property they’ve purchased, before they’ve paid the entire purchase price; this will typically be paid off over several years, and once it is entirely paid off, the buyer is officially the home owner.
What’s the Difference Between a Vendor’s Mortgage and a Terms Contract?
A vendor’s mortgage is similar to a bank loan. It involves a property being transferred, with the buyer paying off the agreed payments.
A terms contract on the other hand comes with its own rules and regulations, and both the buyer and seller need to be aware of these.
Our Approach to Terms Contracts
If you’re purchasing, a terms contract enables you to buy a property the right way. Work with us, and our highly experienced and trained team will guide you each step of the way, ensuring you complete your transaction correctly.
If you’re selling, we implement protective measures to ensure that there’ll be no hiccups surrounding your payment. These include:
- Determining the potential buyer’s financial situation before saying yes to selling.
- Making a significant deposit from the buyer a non-negotiable contract term.
- Making sure that the due date of payment is stated clearly in the contract.
What is a Private Contract?
This is different to a terms contract in that it is sold to a buyer, but without a real estate agent listing. A good pile of legal documents require completion for a private contract, and we can help you with these – from contract preparation and conducting government searches, to the Sourcing Form 1 and documentation surrounding the cooling off period.
Choosing a Conveyancer
To avoid conflict of interest, we recommend that the buyer and seller consult with different conveyancers. If you’ve chosen to sell your property without a real estate agent, we recommend that you get in touch with a settlement agency – like our expert team – who can guide you through the legalities required for the sale of your property.
When it comes to more complicated sales – those involving a number of mortgages, conditions, and guarantees – we can provide assistance by making sure you understand the legalities surrounding the sale of your property. We’ll walk you through the papers and help you get your head around the obligations of the buyer and seller via a:
- Blank REIWA Contract for Sale/Offer & Acceptance
- Joint Form of General Conditions
The contracts surrounding the sale or purchase of a property are complex. Whether you’re dealing with a terms contract or private contract, contact us at Cape Settlements today…we’ll go through the contracts with you and provide peace of mind that you know what you’re doing!