Many locked down in Auckland are probably daydreaming about selling their Auckland home and permanently relocating to another region. If you have taken that leap, before signing any agreement for sale and purchase make sure your settlement dates and any Covid-19 deferral settlement date clauses are carefully reviewed by your lawyer first.
Many of the standard Covid-19 settlement date deferral clauses apply just to the region where the property is located. Where you are selling in Auckland and buying in another region, it is possible to find yourself in a position where your Auckland sale is deferred if restrictions in the region rise again, but this does not have a corresponding delay apply to your purchase settlement date.
Failure to settle a purchase on the settlement date can have significant financial repercussions including penalty interest (up to 14%) and cancellation of the agreement resulting in the loss of your deposit. If you are reliant on funds from the sale of your Auckland property, consider what back-up arrangements you might need in place. This could include looking at what short-term finance options from your bank are available to enable you to settle, having other cash assets available, or negotiating specific arrangements as part of the sale and purchase agreements.
Everyone’s circumstance will be different, and we can assist you through this process.
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© McVeagh Fleming 2021
This article is published for general information purposes only. Legal content in this article is necessarily of a general nature and should not be relied upon as legal advice. If you require specific legal advice in respect of any legal issue, you should always engage a lawyer to provide that advice.