A deposit is paid by you when you purchase a property. In New South Wales, this is 10% of the purchase price unless otherwise agreed between you and the seller.
The deposit will be held by the deposit holder noted on the contract (this is the agent or seller’s representative) until settlement takes place or otherwise agreed.
When does the deposit need to be paid?
Before you sign a contract, the agent may ask you to pay an initial deposit of 0.25% of the purchase price. The balance of the total deposit is generally paid prior to the cooling off period expiring. If you waive the cooling off period, the total deposit will need to be paid upon signing the contract.
Can I pay a smaller deposit?
You can negotiate to pay a smaller deposit however this will be at the seller’s approval.
How to play the deposit
You can pay the deposit:
- In cash
- Electronically using internet banking
- Using a deposit bond from your lender (if agreed by the seller)
You should pay the deposit ahead of its due date to avoid any delays and save a copy of the transfer receipt/remittance. It is important that you diarise the due dates to ensure the deposit is received on time.
You should always verbally confirm the deposit holder’s bank account details to ensure the funds will be transferred to the correct account.
The deposit must be paid when its due otherwise you would be in breach of the contract.
