What is a pre-settlement inspection?
A pre-settlement inspection, sometimes called a
pre-settlement property inspection, allows you to check the property before settlement takes place.
The purpose is to make sure:
- the property is in the same condition as when you agreed to buy it
- the chattels included in the sale and purchase agreement are still there and working
- any repairs or other work the vendor agreed to complete have been done.
A pre-settlement inspection is not another opportunity to reconsider the property or raise issues that were already visible when you agreed to purchase it.
When should you do a pre-settlement inspection?
Ideally, complete your inspection
two to three working days before settlement.
This gives your lawyer or conveyancer time to raise any problems with the vendor's lawyer and work towards a solution before settlement takes place.
Your real estate agent can usually arrange a suitable inspection time with the vendor.
What should you check at a pre-settlement inspection?
Take a copy of your
sale and purchase agreement with you so you can check the property against what was agreed.
During the inspection, check that:
- all included chattels are still at the property and working
- lights, taps, locks and other fixtures are working properly
- there is no new damage to the property
- any repairs or work agreed with the vendor have been completed
- the vendor has arranged to remove their belongings and rubbish before settlement
- arrangements have been made for keys, garage remotes and alarm codes.
If particular chattels were included in your agreement, such as a dishwasher, oven, heat pump or other appliance, make sure you check those too.
What happens if you find a problem before settlement?
If you discover something isn't right,
contact your property lawyer or conveyancer straight away.
Depending on the problem and the terms of your sale and purchase agreement, possible solutions may include:
- asking the vendor to fix the issue before settlement
- agreeing to a reduction in the purchase price
- holding back some of the purchase money until the issue has been resolved.
If an agreement cannot be reached, your lawyer may need to make a compensation claim before the relevant contractual deadline. This is why it is important not to leave your pre-settlement inspection until the last minute.
Do you need a lawyer for a pre-settlement inspection?
Your lawyer does not usually attend the inspection with you, but they play an important role if you discover a problem.
Contacting them promptly gives them time to review your sale and purchase agreement, advise you on your options and communicate with the vendor's lawyer before settlement.
Buying a property?
A pre-settlement inspection is your final opportunity to make sure the property is in the expected condition before you complete your purchase.
At Smith and Partners, our experienced
Property Law team can guide you through the buying process, from reviewing your sale and purchase agreement through to settlement.
If you are buying a home or investment property and need advice,
talk to our Property Law team.
