Page 22 - AML Seller's pack_ Whole document
P. 22
22 | REA guide – sale and purchase agreements
General obligations and conditions
you have to comply with
The sale and purchase agreement includes
general obligations and conditions that you
will need to comply with. For example, these
may include:
• access rights – what access the buyer The agent helps the buyer and the
can have to inspect the property before seller to include the conditions they
settlement each want. Even though the agent
• insurance – to make sure the property works for the seller, they also have
remains insured until the settlement date to deal fairly and honestly with
and outline what will happen if any the buyer. They can’t withhold any
damage occurs information, and they must tell the
• default by the buyer – the buyer may have to buyer about any known defects with
the property.
compensate the seller if they don’t settle on
time, for example, with interest payments Your agent will probably use the
• default by the seller – the seller may have agreement for sale and purchase
to compensate the buyer if they don’t approved by the Auckland District
settle on time, for example, by paying Law Society and the Real Estate
accommodation costs. Institute of New Zealand.
Your lawyer will explain these clauses to you.
Specific conditions a buyer
may include
Some buyers will present an unconditional • Land Information Memorandum (LIM) –
offer, which means there are no specific provided by the local council, this report
conditions to be fulfilled. Some buyers will provides information about the property
include one or more conditions (that must such as rates, building permits and
be fulfilled by a specified date) in their offer consents, drainage, planning and other
such as: important information
• title search – this is done by the buyer’s • builder’s report – to determine the condition
lawyer to check who the legal owner of the of the building
property is and to see if there are any other • engineer’s or surveyor’s report – similar to
interests over the property such as caveats the above but more focused on the entire
or easements section and the structure of the property
• finance – this refers to the buyer arranging • sale of another home – the buyer may
payment, often requiring a mortgage need to sell their own home in order to
or loan buy another.
• valuation report – a bank may require the
buyer to obtain a valuation of the property
(an estimate of the property’s worth on the
current market) before they agree to a loan
BFT015 DEC18
