What is Exchange?

Exchange of contracts may be the most important step taken during a property sale or purchase!

In NSW your legal obligations and rights do not commence until you have secured exchange of contracts. This means that if you are trying to buy a property, the best way to bind the seller to the deal, and secure the sale price, is to get contracts signed, a deposit paid and contracts exchanged.

The actual process of an exchange is when a copy of the contract signed by the purchaser is swapped for an identical copy of the contract signed by the vendor. The purchaser must also pay a deposit. The two identical contracts are then dated. The exchange can be done by conveyancer or real estate agent.

You should contact a knowledgeable conveyancer to advise you of the risks and liabilities you will be subjected to by signing a contract before signing. Instant contract advice is available if you have an email copy of the contract.

It is ideal to complete an exchange of contracts quickly to secure the agreed deal and prevent the parties from straying from the proposed transaction.

As soon as a buyer or seller signs a contract and exchange takes place they are putting funds at risk.

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