Getting ready to make an offer
Finding the right place is exciting, but there are a few things you need to do before making an offer
Property Inspections and reports
One of the most important steps in shopping around is having the right inspections and reports done on a property you're interested in.
These reports can give you an advanced warning on issues with the property, leverage to negotiate a lower price and a diagnosed problem for which you know what steps would need to be taken to repair the property.
These are the most common inspections property investors should have done.
Property / Building Inspection Report - This is the most important inspection that all buyers should have done. It is a written report that goes into detail about the condition of the property and explains the properties history. If the property or building has any defects, they will be thoroughly explained. The cost and type of professional you need to inspect the property will depend on the age, location and type of property.
- Pest Report - Depending on the age and materials of the property, it may also be worth investing in a pest inspection report prior to purchasing a property. Pest and building inspections can cost upwards of $400 and will tell you whether you're about to inherit tiny termites and or structural damage.
Make an offer or bid at auction
Don't forget you'll need to pay a deposit if your offer or bid is accepted. Be prepared to cover at least 5-10% of the purchase price.
Let your mortgage broker know you've found your property. They'll finalise your investment loan. If you have loan pre-approval, full loan approval may take only a few days. Once your loan has been approved, you'll receive a formal Letter of Offer to sign.
Settlement of your loan will then get underway, starting with the receipt of your loan documents.
You'll need to forward these to your solicitor, who'll liaise with your lender to schedule the settlement date. A settlement timeframe is set out in the contract of sale. Your first loan repayment will usually be due one month after settlement.
Don't forget to organise insurance, such as building and landlord protection. Loan Market Concierge will give you 30 days free home and contents insurance and help you with utility connections. You may also want to organise a property management service.