FREQUENTLY ASKED QUESTIONS

NSW property contracts are legally binding upon exchange and filled with complex terms. Before making an offer, a solicitor can check the contract to uncover hidden legal issues, ensuring you understand the risks involved and can form a smart bidding strategy. Critical details — such as the nature of the title, restrictive burdens on title, or adverse zoning requirements — cannot usually be spotted during a physical inspection.

We understand that buyers do not want to overly spend money on legal fees for a property only to find out it has major legal flaws. For this reason, Poised offers our purchaser clients three complimentary, verbal contract screenings to spot critical red flags before you make an offer.

When preparing for an auction or a contract exchange, pre-contract negotiations generally fall into three categories:

1.     Amendments to Contract Terms: You can leave this entirely to Poised. We identify imbalanced clauses and request adjustments to better protect your legal interests.

2.     Vendor Enquiries: We write directly to the vendor’s solicitor to uncover critical details about the property's condition and history — asking the tough questions you need answers to.

3.     Your Specific Requirements: Whether you need a 5% deposit, a tailored settlement period, or an extra pre-settlement inspection, just let us know. We will propose the right special conditions to the vendor’s solicitor for approval.

About Timing

We strongly recommend finalising all contract negotiations before attending a public auction. Once the hammer falls, the successful bidder loses almost all negotiating power and must sign the contract exactly as it stands.

For a private treaty sale, while you have more flexibility, all negotiations must still be finalised before the formal exchange of contracts to ensure you are legally protected.

In NSW, residential property purchasers are generally entitled to a 5-business-day cooling off period. This window is extended to 10 business days if the property is purchased off-the-plan. Please note that the cooling off period does not apply to residential properties sold at auction, as auction sales are unconditional.

During this cooling off period, the purchaser can conduct essential due diligence to decide whether to proceed with the purchase unconditionally or withdraw from the contract. If they choose to pull out, they forfeit 0.25% of the purchase price to the vendor, but are otherwise released from all contractual obligations.

Because the contract is conditional during the cooling off period, purchasers still hold some bargaining power; they can threaten to pull out if the vendor refuses certain amendments. However, parties cannot alter the terms of an exchanged, conditional contract as easily as they could a draft contract. To ensure any newly negotiated changes are legally enforceable, the parties need to execute a Deed of Variation, which can be a hassle.

Consequently, it is still highly recommended to fully negotiate all contract terms prior to exchange, even if a cooling off period applies. This allows the purchaser to dedicate their cooling off period to other critical due diligence tasks, such as securing formal finance approval, obtaining building and pest reports, and making local council enquiries.

A Section 66W Certificate is signed by a purchaser’s legal representative to confirm that the client understands the certificate's effect and agrees to waive their cooling-off rights. This makes the contract legally binding and unconditional immediately upon exchange.

Consequently, the risk is that once the contract is exchanged with this certificate, the purchaser loses all negotiating power and cannot pull out of the contract without severe financial penalties.

While it is straightforward for a solicitor to issue a Section 66W Certificate, its legal consequences are significant. Therefore, we strongly recommend only providing this certificate after all due diligence has been satisfactorily completed.