Paying the deposit on your purchase
Have you bought a property but you don’t have the deposit available? It happens often, and it can cause serious stress as the unconditional date approaches. So I thought I'd outline the rules and process: The amount of a deposit is completely negotiable. With auction it is set at 10% but you can negotiate with the real estate agent before the auction if you do not have the 10% available. Agents/vendors want as many bidders at auction as possible so will generally agree to a lower deposit. With private treaty (by negotiation) sales you set the figure as part of signing the sale and purchase agreement. 5% is usually enough. With bigger purchases you can usually cap the deposit at a set amount, say $25,000.
When is the deposit paid?
You normally agree to pay the deposit on going unconditional. Occasionally real estate agents ask for the deposit upfront but this is not as common. If you do not have funds available we will set up a temporary overdraft or draw down the funds on your existing property to form the deposit. Although it is best to pay the deposit on unconditional day this is often not possible due to the amount of paperwork required to get temporary facilities in place - especially if you are a first home buyer. In this situation you can go unconditional, and as a courtesy let the agent know that the deposit will be paid within 48 hours. Always check with your solicitor - you have three working days from being served notice (by the vendor's solicitor) to pay the deposit. This means you have at least three working days from going unconditional to pay it.