Buying Tips

Find Out Everything You Need To Know About Buying A Property With These Frequently Asked Questions

Buying Property-min

What Is A Section 32 Document?

A section 32 document gets its name from the Section 32 of the Sale of Land Act, which details the information a vendor needs to provide to a purchaser before signing a Contract of Sale. This information typically includes:

  • The title
  • Who owns the property
  • Mortgages or caveats over the property
  • Easements that affect the land
  • Covenants
  • Property zoning
  • Planning overlays
  • Council and water rate information
  • Any building permits obtained over the last 10 years
  • Whether the property is prone to bushfires

Section 32 documents are also known as Vendor Statements and are available for viewing by prospective buyers before they form a contract for the property. They’re often shown to solicitors or conveyancers for review prior to entering into a Contract of Sale.

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What Is An Easement?

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An easement is a registered section of land on a property title that gives an individual the right to use that land, such as for storm water drainage or a shared driveway. Other types of easements typically include phone lines and power lines, although these aren’t always shown on the title.

The majority of blocks will have easements, as they’re required to facilitate sewerage and stormwater drainage. All this means is the individual mentioned in the easement (in this case the service provider) may need to occasionally gain access to the land.

If you plan to build over the top of an easement, you’ll need to seek permission from the individual who holds it, such as the service provider or your local council.

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What is a Covenant?

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A restrictive covenant details a property owner’s obligations, as well as what they’re allowed to do with it. For example, a restrictive covenant might state there is no more than one property to be built on a patch of land.

Often, restrictive covenants are put in place by the original property developer, in order to protect the look and feel of the development. In this instance, the covenant may well be used to limit the number of dwellings per property, the types of fences used, and the facades used on the buildings.

If you’re after detailed information on restrictive covenants, it’s best to speak with your conveyancer or solicitor.

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What Documentation Do I Need To Apply For Finance?

Home Loan Application-min

To apply for property finance, your provider will ask for a substantial amount of information.

Nobody wants to have to wait around for weeks before their loan is approved, which is why we’ve created this useful checklist to help you get things moving quickly:

Personal identification

  1. 100 points of ID are required. A current passport or birth certificate equals 70 points and a driver’s license equals 40. If these documents are in your maiden name, you’ll also need to provide your marriage certificate. Other documents that can help you reach 100 points include ATM/debit cards, council rates notices, health care cards, student ID cards, and pensioner concession cards.
  2. Two most recent payslips from your employer.
  3. The most recent group certificate from your employer.

If you’re self-employed

  1. Two years of personal and business tax returns and ATO assessments
  2. Any other income details of assets

You may also need

  1. Rental income statements or bank accounts showing rental income for any investment properties
  2. Proof of share dividends
  3. Centrelink letter confirming family tax benefits
  4. Centrelink letter confirming permanent government pensions
  5. Private pension group certificate or statement
  6. Proof of any other regular, ongoing income

Additional documents for first home buyers

  1. Statement for your First Home Saver Account (if applicable)
  2. The last 6 months’ statements showing savings/investment history
  3. Evidence of funds, if alternative funds are being used for purchase
  4. A Statutory Declaration from the financier, if other funds are being used for the purchase
  5. Your most recent credit card statement
  6. Copy of your target property’s Contract of Sale

Additional documents for refinancing

  1. Existing loan documentation, including loan commencement date, loan period, and any financial penalties for early closure
  2. Six months of statements for any personal and home loans
  3. The most recent Council Rates Notice and buildings insurance policy on the property being offered as security
  4. Credit card statements detailing 6 months of credit history, or your most recent statement if you don’t owe anything

Additional documents if you already own a home

  1. 6 months of statements for any existing home or personal loans
  2. Your most recent credit card statement
  3. Copy of the target property’s Contract of Sale
  4. 6 months of statements showing your savings/investment history
  5. If alternative funds are being used, evidence of where the funds are held
  6. A Statutory Declaration from the financier, if other funds are being used for the purchase

Additional documents if you have investment properties

  1. Proof of income, such as rental statements
  2. A copy of the tenancy lease
  3. A Council Rates Notice
  4. A copy of the Contract of Sale for the property being purchased
  5. A letter from a property manager stating the new property’s rental value

Additional documents if you’re seeking a construction loan

  1. A copy of a valid builder’s fixed price tender, including all specifications
  2. A copy of council-approved building plans

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How Much Is Stamp Duty?

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The amount of stamp duty you’ll have to pay can vary. For a quick and easy calculation, please look at our stamp duty calculator.

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What Other Costs Are Involved With Purchasing A Property?

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Understandably, the main cost of buying a property in Victoria is the purchase price itself. Beyond that, you’ll also have to pay for stamp duty, mortgage registration fees and transfer fees. All of these are covered in our stamp duty calculator.

When purchasing a property, some buyers can encounter additional costs. These typically include conveyancing or solicitor’s fees, building and pest inspection fees, and removals and service connection costs.

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What Types Of Offers Are there?

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There are two primary offer types, both with their own advantages depending on your situation:

Conditional offers

This offer is dependent on certain conditions you lay out with the seller, such as ‘subject to finance’ or ‘subject to pest and building inspection’. This offer generally gives you 7-day period to complete any conditions that have been set and the sale process won’t be complete until you do.

Unconditional offers

In a strong market, the vendor may be unwilling to accept conditional offers, as they’ll effectively be taking the property off the market until the conditions are met. This could mean they miss out on better offers.

For this reason, some vendors only choose to accept unconditional offers. This means your offer will have to be submitted without any conditions in order to secure the sale. This can be a good option if you’ve already got your finances in order and don’t see the need for inspections to be carried out.

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What Do I Do Once My Offer Has Been Accepted?

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If you’ve had your offer accepted, congratulations! After this, you’ll need to complete any sale paperwork and pay a standard 10% deposit, unless another percentage has been agreed.

Your legal representative will need to be provided with a copy of the signed Section 32 and Contract of Sale, so they can check the paperwork for you. You’ll also need to contact your lender so they can complete any mortgage documents.

Closer to the settlement date, you can arrange for a pre-settlement inspection to be carried out. This is a useful opportunity to look around the property and ensure it’s in the same condition as when you made the original offer.

To save you time, here’s the main process in checklist form:

  1. Provide your legal representative with documentation
  2. Finalise your mortgage documents and send them to your lender
  3. Organise transfer of rates, water, and other utilities
  4. Redirect your mail
  5. Arrange any required removals
  6. Organise home and contents insurance
  7. Redirect your mail
  8. Pick up your new keys

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Should I Insure My Purchased Property Prior To Settlement?

House Insurance

Although you don’t have to, we advise all our clients to insure their property once paperwork has been signed.

Insurance isn’t expensive, especially when you imagine the amount of money it can save you if any events took place prior to settlement.

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Where Can I Go For Finance?

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There are various financial institutions available to finance your purchase and the Professionals Finance Division can help you through the process.

Our finance experts will help to fast-track your loan through one of the 40 cherry-picked lenders we have on offer. Contact our office for more information.

If you already have a financer that you’d like to use, such as a family bank, it’s best to book a meeting with them to discuss your options prior to beginning your property search. With this information in hand, you’ll be able to narrow your search to the segment of the market you can afford.

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I Have Equity In My Home But No Cash For A Deposit – What Can I Do?

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Don’t worry, not all is lost. Get in touch with your finance provider and discuss the possibility of a deposit bond. This is essentially a bank guarantee that you have the equity to cover the property deposit amount.

If you’re planning on using a deposit bond, it’s best to make the agent aware when you submit your offer. This gives them the full picture and a strong basis on whether to accept or request other means of funding.

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