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TESTIMONIALS:
Garth Brown Endorsement
Hi
Garth - smooth and professional, and with one piece of advice alone,
you have saved us your fee. Can’t ask more than that.
Thank you again, cheers,
Paul
.
. . . . . . . . . . . .
Hi
Garth,
Just to let you know that we received our deposit back from the real
estate agent's office last week. Thank you for the service you provided
throughout the whole process (especially in helping to get the deposit
back a sap) - it was great, and really appreciated. We thank you again
and wish your business well.
Kind regards,
Lydia and Stephen - Artarmon
. . . . . . . . . . . .
Hi
Garth,
You are a champion!
Many thanks- I know it wasn't easy!
I'll be in touch on Monday.
Thanks again,
Bruce
Dr Bruce Schaefer
GEMOC, Earth and Planetary Sciences
Macquarie University
.
. . . . . . . . . . . .
Last month Garth was a Guest Speaker at National Australia
Bank discussing Conveyancing; buying and selling tips to
Home loan Brokers at North Sydney and Bondi Junction; Engagement pending
with Marrickville National Australia Bank as a Guest Speaker on Conveyancing.
He also met up with Vision Home loans where they started
working with and arranging a Guest speaker engagement.
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Brown
& Brown e-Newsletter
by
Garth Brown
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"What
happens after a Deposit is paid to the Agent?"
The Deposit (usually 10% of the Purchase price) is held by the Agent
for approximately six weeks settlement period in either an "interest
bearing or non interest bearing trust account".
1. TAXATION and THE DEPOSIT
TIP - find out from
the agent the type of trust account held:
"interest bearing”
or
“non interest bearing"
This is very important for both the Vendor and Purchaser for Taxation
purposes, if you don’t supply your Tax File Number (TFN) for
an ‘interest bearing account’ for the six week settlement
period then the Government will tax the _ share of the interest earned
at a rate of 50% to both Vendor and Purchaser.
Particularly off the plan purchases that can take up to two - three
years to settle and complete – make sure you supply the TFN
to the agent via email ASAP.
2. RELEASE OF DEPOSIT
At the end of the Conveyance both the Vendors and Purchasers Conveyancers
fax a letter authorizing the Agent to release the Deposit less their
commission to the Vendor.
3. CAN A DEPOSIT BE PAID TO THE VENDOR
EARLY BEFORE
THE SETTLEMENT DATE?
There is generally a Special Condition in the Contract allowing the
Deposit to be released before settlement to purchase another property
and settle on the same day as the settlement of the Vendors property.
It involves issuing letters to the Agent to release the Deposit from
both Vendors and Purchasers Conveyancer.
At Brown and Brown we though would negotiate for this Special Condition
to be deleted from the Contract if we were working for the Purchaser.
The risk is that if the Vendors Sale does not proceed trying to recover
the Deposit could become an absolute nightmare.
Therefore we say it is better for the Vendor NOT to access the Deposit
before settlement to buy another property; the better alternative
is to obtain a DEPOSIT BOND
- a paper guarantee to pay the Deposit at Settlement for the Vendor
to purchase another property, before settlement to buy another property.
4. FACTORING COMPANIES
Of interest to Real Estate Agencies are companies who will fund 80%
of the Real Estates Commission for a sale or purchase to the Agency
from the date of exchange (or signing of the Contract); when settlement
is effected the full amount of the Commission held by the agent is
returned to the Funding Company (also known as a Factoring Company)
at the end of the six week period, this is a means to keeping cash
flowing less 20% of the commission by not waiting six weeks to access
the commission.
Our
next eNEWS "Why the need for House Insurance after signing a
Contract for a Purchaser?” April 2010
In the meantime you can keep in touch with Garth Brown
on
Send
this newsletter to your friends
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CONVEYANCING ARTICLE IN AUSTRALIA'S BEST BUILDING,
CONSTRUCTION & MINING MAGAZINE.
Garth Brown Endorsement.
. . . . . . . . . . . . .
Thank
you again for your valued custom.
License No: 1055854
We appreciate the referrals.
. . . . . . . . . . . . .
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