Template to Use: Click here to use our due diligence condition and make your offer to the real estate agent.
Begin by familiarising yourself with HouseMe Legal and the due diligence condition. Gain an understanding of the four most common conditions in an Agreement for Sale and Purchase of Real Estate (ADLS agreement). The focus of this guide will be on the due diligence condition.
Next, submit a written offer to the vendor (the seller of the property), making your offer subject to the completion of due diligence. This means you're making your offer conditional upon being satisfied with various aspects of the property, which you'll investigate during the due diligence period.
The vendor can either reject or accept your offer. If your offer is rejected, you will have to go back to the beginning of your home searching process, which may include attending open home events.
If your offer (with a due diligence condition) is rejected, HouseMe Legal will not charge you any fees,
If the vendor accepts your offer, you will have a timeframe to complete your due diligence. This period is often around 10 working days. Note that this is when you start incurring legal fees.
During the due diligence period, you should engage with professionals to help assess the property. This could include a building report specialist or a LIM (Land Information Memorandum) report specialist. They will help you thoroughly assess the property.
After your investigations, you will need to either approve or reject the due diligence condition. If you find that you are unsatisfied with the property for any reason (as found in your investigations), you can choose not to satisfy the due diligence condition. This means the agreement ends, and you return to the home-searching process.
Regardless of whether you're satisfied with the due diligence or not, you will need to pay your legal fees and any other third-party invoices and disbursements that were accrued during this process. If you are satisfied, you will pay your legal fees on settlement day when you own your house.
If you approve your due diligence condition and are happy with the property, the agreement becomes unconditional. You will then move on to preparing for settlement day, which is when ownership of the property officially transfers to you.
Want to know more?
Check out our full summary of the Due Diligence Condition in this Blog.
