Buying your first property can be an exciting but daunting process. On top of the usually lengthy process of contract finalisations, buyers can sometimes question their decision at the final moment and think: “is this property really right for me?”. Thankfully, in New South Wales there is a period of five days after the contract is signed called the ‘cooling off period’ that gives buyers more time to conduct inspections and financial reconsiderations. Although it may seem like a good thing for many property buyers, there are those who want to proceed quickly with their transaction. For this reason, a section 66W certificate exists. This Legal Kitz article will consider all elements of a section 66W certificate.
What is a contract?
Before we move on to explaining the section 66W certificate, let’s consider how a property contract works. When buying or selling a property, the property is not taken off the market until after the contracts have been exchanged. This refers to the moment that both parties have signed and dated the contract. This exchange is then finalised once the buyer pays the deposit for the property – the contract is then binding.
What is a cooling off period?
The cooling off period refers to the five day period after the contracts have been signed in which the buyer can rescind the contract with no legal penalties. This cooling off period is useful for the buyer as it provides more time to conduct inspections and financial considerations before finalising their purchase. Although there is no legal penalty, there is still a 0.25% termination fee that must be paid – which is significantly less than the cost of buying the wrong property!
What is a section 66W certificate?
A section 66W certificate is a certificate that is signed by a solicitor or conveyancer acting for the purchaser which has the effect of waiving the purchaser’s five business day cooling off period. This cooling off period and waiving of the period is regulated by the Conveyancing Act 1919, which is an act to amend and consolidate the law of property and to simplify and improve the practice of conveyancing.
Why do I need a section 66W certificate?
As aforementioned, the cooling off period is useful for providing buyers with more time to consider their property purchase. There are instances of buyers who wish to speed up the process of their property purchase and who may benefit from utilising a s66W certificate and waiving the additional five day cooling period. One such reason may be to quickly secure their property in a highly competitive property market.
On the other hand, some sellers may also benefit from a s66W certificate. If a seller wants to secure their sale of the property quickly, using the certificate to waive off the cooling off period will achieve this.
Legal advice
A section 66W certificate is useful for buyers and sellers to bypass the five day cooling off period that is associated with property conveyance in NSW. There are numerous benefits that the cooling off period provides for the buyer, however, the s66W certificate is used to quickly settle property sales. If you require legal advice regarding any element of a section 66W certificate, our friendly and highly skilled team are happy to help! Book here now for your FREE 30-minute consultation.