If Contracts have exchanged with a cooling off period, you have the option to get out of the Contract prior to the expiration of that cooling off period, for any reason.
In the instance you decide not to proceed with the purchase, you will forfeit the 0.25% deposit (the holding deposit which equates to a quarter of a per cent of the purchase price) to the Vendor. This is compensation to the Vendor for having the property off the market for you.
Working example. You entered a Contract to purchase a property for $800,000. You pay a 0.25% deposit of $2,000 to the Agent. Contracts were exchange on 1 November 2018 with a 5 day cooling off period. The cooling off period expires at 5pm on 8 November 2018. On 7 November 2018 you are advised that you will not be able to obtain the finance required to proceed with the purchase and instruct your Conveyancer to rescind the Contract. The Contract comes to an end and you forfeit your holding deposit to the Vendor.
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This blog is merely general and non specific information on the subject matter and is not and should not be considered or relied on as legal advice. Coutts is not responsible for any cost, expense, loss or liability whatsoever in relation to this blog, including all or any reliance on this blog or use or application of this blog by you.