As a Property Seller, Have You Completed Your Vendor's Statement Yet?

Posted on: 27 June 2018

If you are putting your home on the market, then you already know that there is quite a lot of paperwork attached, and the process can be fairly lengthy. Of course, you want to streamline this as much as possible so that you can move on to your next property, but you may nevertheless need to exercise some patience if you are to protect yourself as much as possible. In particular, why should you be bothered about something called a 'section 32'?

The Importance of the Statement

This particular piece of paper (which is common in certain states) is also known as a 'vendor's statement.' It can be attached to a contract when a property changes hands and will typically contain some detailed information that may be crucial for both parties to know.

As a seller, you may come across plenty of interested buyers, and someone will soon make you an offer. It's in your best interest to make sure that they are fully aware of any potential restrictions in relation to this property, as you don't want them to pull out just before you close.

What's Included?

Within this statement, you need to include not just the basic information about property ownership, but whether there are any encumbrances linked to the home that may affect the buyer's ability to use it the way they want. You should detail the existence of any building permits, current or past, tell the buyer whether there are any charges levied against it and whether an owner's corporation has been established to manage common areas. They will need to be made aware if the property is located in a bushfire zone, if a homeowner's association restricts them from certain activities and if there are any city planning restrictions in the area.

For a vendor statement to be considered complete, a comprehensive search will need to be done of all relevant records to uncover any surprises. As the seller, you also need to inform your solicitor if you know of anything that should be incorporated.

Risks to the Seller

You must be particularly careful, as if the statement proves to be incomplete, the buyer can pull out of the contract between signing and settlement. They will be legally entitled to exercise their right to withdraw because they were not fully informed. In this case, you may well have to incur additional legal fees and all the hassle of putting the property back on the market.

Getting It All in Order

Make sure that you comply with section 32 if necessary and ensure that your vendor statement is as complete as possible by talking to a conveyancing solicitor promptly.