If you are buying a property in NSW you will often face buying with the option of a cooling off period. A cooling off period is a 5 business day time frame that applies after an offer is accepted, & both contracts have been signed (by buyers & vendors). The property is then ‘exchanged under a cooling off period’. The buyer must pay 0.25% of the agreed sale price & if, for whatever reason the buyer changes his/her mind that deposit is credited to the owners of the property. Its during this time a buyer can carry out necessary building checks & if needed a strata search.
Its important to remember when buying at Auction the option of a cooling off period does not apply. Instead contracts are exchanged unconditionally.If the home is purchased outside the Auction event, a form contained in the contract called a 66w is signed by the purchasers Solicitor waving the cooling off period & allowing the property to exchange unconditionally encompassing a 10% (or 5%) deposit of the purchase price.