After exchange, the purchaser may have time to “cool off”. Not all States allow a cooling off period but if a cooling off period applies, the purchaser can withdraw before the end of the cooling off period. Cooling off does not apply to sales at auction.
Victorian purchasers may end the contract within three (3) business days of the day that the purchaser signs the contract, if none of the exceptions listed below applies to the purchaser. The purchaser is entitled to a refund of all the money paid except for $100 or 0.2% of the purchase price (whichever is greater).
The three (3) day cooling off period does not apply if:
- The purchaser bought the property at or within three (3) business days before or after a publicly listed auction; or
- The purchaser and the vendor previously signed a contract for the sale of the same land, in substantially the same terms; or
- The purchaser is an estate agent or a corporate body.
In NSW cooling off is five (5) business days from exchange, unless it has been waived by the purchaser, who has received a “Section 66W Certificate” from a solicitors or conveyancer. If the purchaser properly exercises their right to cooling off, the purchaser forfeits 0.25% of the purchase price. Some vendors may refuse to exchange contracts unless a signed Section 66W Certificate is provided.