STOP: I can’t complete a house purchase

Jul 13, 2022

Buying a house is a big deal, it’s a major milestone for most people, and worthy of a celebration, but if you find yourself having second thoughts about a property or are wanting to back out of a property deal completely, celebrating will be far from your mind.

 

When can I stop a house purchase?

A signed Sale and Purchase Agreement is a legally binding contract between you and the seller, which becomes unconditional once the allocated time for meeting your conditions has been reached. When a house purchased in an auction, the contract is unconditional at the drop of the hammer. An unconditional agreement is extremely difficult to end without being sued by the vendor. Prior to entering into an agreement, it is highly advised that you let a property lawyer review the agreement prior to signing it. 


You should not be relying on your pre-approved finance as being a bullet proof, these may only be active for a certain period and afterwards you may have to reapply. You need to keep this in mind if the settlement date is after your pre-approval expiring, as you find that your finance is declined when you reapply.


What are the consequences of pulling out of a house purchase?

People pull out of property deals for many different reasons. Lack of funds, a change in circumstances such as losing your job. This can result one or all of the following happening;


  • Forced to buy the property
  • Lose your deposit
  • Pay interest from the day of settlement (check the Sales and Purchase Agreement for interest rate)
  • Cover vendor costs for reselling the property and the difference in the sale price


Weston Ward & Lascelles have decades of experience advising clients on property law and conveyancing in Christchurch NZ. Helping people purchase their dream home is the ideal scenario, but the other side of the coin are the people who are unable to complete a purchase. It is a distressing and stressful time for these clients, and our property legal team work to achieve the best possible outcome so they can move on with their lives.


If you would like any advice about your situation, our free pre auction package review, or Christchurch conveyancers, please call 03 379 1740 for further information.

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It’s second nature for those involved in business to engage a lawyer experienced in business and commercial law for business advisory services. Whether it’s for a startup or an established organisation, contract reviews are a valued and expected expense to ensure the terms and conditions are fair, accurate and aligned with the client’s best interests. Yet, this same level of diligence and self-protection is often neglected in personal matters, including buying a property. With rising property prices, unstable mortgage rates and unemployment rates expected to hit 5% by the end of the year, spending more money to complete a house purchase is likely the last thing you want to think about. However, and this is a huge however, engaging a Christchurch property lawyer to review the Sale and Purchase Agreement before signing is a wise investment; it is a strategic move that can save you from significant future complications. Weston Ward and Lascelles are leading property and conveyancing lawyers in Christchurch who help clients buy properties. From first home buyers to clients with multiple properties, our advice is always the same: do not sign on the dotted line until the Sale and Purchase Agreement has been reviewed, and here’s why: Entering into a Sale and Purchase Agreement is legally binding, it’s a contract. A major principle of property law is caveat emptor or “buyer beware”. The onus is on you to protect your property, assets and finances, and a Sale and Purchase Agreement contact review does just that.  Ensures a smooth conveyancing process compliant to laws and regulations The key role of a property lawyer is to oversee the conveyancing process and keep the schedule on track . Invariably this means liaising with real estate agents, the vendors’ lawyers, local councils and other stakeholders. Aside from collating and reviewing information, conveyancers ensure the legal obligations are adhered to.
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