It is without a doubt that COVID has changed an immeasurable number of things. One such example of this is the story of our client Arnold.
Arnold was purchasing home for his family, and was excited about the purchase after realising his children had fallen in love with the house, and the fact that they had a big backyard to play in. The matter exchanged with a 5-day cooling off period.
Our team received the contract, advised the client and sought the required amendments. Although Arnold was ready to proceed, his loan approval was being held up due to the mortgagee’s back log as a result of COVID.
We were able to quickly negotiate a further 10 day cooling off period which allowed Arnolds incoming mortgagee time to organise finance. The day prior to the expiry of the cooling off period, Arnolds incoming mortgagee informed us that a deposit bond was required to effect unconditional exchange. We requested this from the other side and were able to provide a deposit bond in time.
Because we were granted multiple extensions to the cooling off period, Arnold had two and a half extra weeks to finalise his loan and settle the matter. However, one day prior to settlement, we were notified by the incoming mortgagee that they will not be in a position to settle the matter by the settlement date and to request another extension.
The Contract of Sale is very strict in terms of default interest and penalties which apply if settlement does not occur on time. One Law wrote to the other side and successfully negotiated a lower penalty and no default interest being charged, which meant that Arnold was able to save some money in an otherwise very expensive transaction.