Hello every one,
I have a 15 Acre hobby farm in Diggers Rest Vic. My tenant has offered to buy the property but needs a 12 month settlement, I know the standard is 3 months, but was wondering if it's legal to accept a 10% Deposit and balance in 12 months? Any advice is appreciated. Thank you.

Hi Hass,
It is definitely legal to have a 12 month settlement. The key thing is to protect your interest in the property throughout the settlement period.
I would recommend you speak with a solicitor and conveyancer who can assist with the contract of sale and any special conditions that need to be included.
As the tenant could not get finance approval that would be valid for 12 months, you must clearly state the treatment of the deposit and how costs or penalties will be applied if they are unable to get finance in 12 months time.
Pay for professional advice, you will appreciate it if anything doesn’t go to plan
Best of luck
Scott

Hi Hass,

That's wise advice from Scott Howell. It's definitely legal to have a 12 month settlement but I would be wanting to understand why the purchaser wants such a long settlement. You could ask him to get a Pre-Approval from his bank first. Pre-Approvals do lapse after 3 months but provided the client's circumstances do not change, ie getting a new job or taking on more credit facilities such as buying a car on finance or getting a new credit card or having another child, they can be renewed relatively easily. You definitely need a properly drawn up Contract of Sale done by a Solicitor. You need to be protected if it all goes "pear shaped' at any time during the 12 months.

Cheers,

Michael Budge
Director
Bayside Finance Group