+ Reply to Thread
Page 1 of 2 12 LastLast
Results 1 to 10 of 15
  1. #1
    Join Date
    Nov 2014
    Posts
    572
    Thanks
    164
    Thanked
    582
    Reviews
    0
    Achievements:Topaz Star - 500 posts

    Default Property "lock-in" fee

    So I'm looking at purchasing a property and we have put a verbal offer on a house.

    Only thing is (this is the first time I've experienced this) the seller has asked the real estate agent to take a "lock-in" fee of $500 plus plus our offer in writing when we place our offer. Reason being that they only want serious offers, and to prevent being stuffed around by people who make an offer only to then offer even less when the seller accepts the original offer. If the seller rejects the offer, we get our $500 back, BUT if we change our mind, we don't and the agent keeps the cash.

    Is this normal? Is this something that happens often?

    We are going to look at the house again in a few days to check that it has everything we want (flyscreen, working electricals, etc) because we are considering putting in the lock-in fee. And then of course, having everything we want in the contract, to make sure the house is fully equipped and there are no problems. Thoughts?

  2. #2
    Join Date
    Jan 2010
    Posts
    5,554
    Thanks
    1,602
    Thanked
    2,360
    Reviews
    6
    Achievements:Topaz Star - 500 postsAmber Star - 2,000 postsAmethyst Star - 5,000 posts
    Seems a little odd to me. In NSW, you pay a fee of 0.25% of the purchase price when you come to an agreement on price with the vendor and sign the contract. Then you've got a cooling off period (5-10 business days) to do your building & pest inspections, after which time the contract becomes binding and you have to pay the 10% deposit. If you pull out during cooling off you lose the 0.25%.

    I'd ask a local agent about it, unless it's part of the formal process I can't see how they can arbitrarily decide to create a lock-in fee that's non-refundable!

  3. #3
    SuperGranny's Avatar
    SuperGranny is offline Worlds best grandma! Winner 2012 - Most Helpful Member
    Join Date
    Jun 2008
    Location
    sunshine coast qld
    Posts
    6,143
    Thanks
    4,543
    Thanked
    2,725
    Reviews
    0
    Achievements:Topaz Star - 500 postsAmber Star - 2,000 postsAmethyst Star - 5,000 posts
    This is not something that I have ever heard of before. We have made verbal offers to purchase, and the agent draws the contract with our offer on the contract. The seller can cross the price out and put a higher price, then we can agree or not agree. If we do not agree to the higher price, the contract is thrown out. I have never been charged a "lock-in fee". or even a fee for drawing up the contract. ??? very strange . marie.

  4. #4
    Join Date
    Nov 2014
    Posts
    572
    Thanks
    164
    Thanked
    582
    Reviews
    0
    Achievements:Topaz Star - 500 posts
    It's only non-refundable if we change our mind, but it just seems so odd to me. I've never heard of this happening and am very reluctant to give them the cash when there isn't even a contract written up yet.

    The seller even took a while to get his section 32...but still had an open inspection 2 weeks ago even though his paperwork wasn't organised and he wasn't really taking any offers on board as much as he should have because of this. I feel stuck because it's a great property and the price is pretty reasonable. But something doesn't feel right.

  5. #5
    Join Date
    May 2007
    Location
    Gippsland
    Posts
    14,656
    Thanks
    1,208
    Thanked
    3,834
    Reviews
    2
    Achievements:Topaz Star - 500 postsAmber Star - 2,000 postsAmethyst Star - 5,000 postsEmerald Star - 10,000 posts
    We were required to put $1000 deposit on our farm, similar sort of thing I think. We were happy to pay as it was definitely the one we wanted and was the only one we had an offer on at that time. The estate agent held it in the trust account and it went towards our 10% deposit once the sale went through.

  6. #6
    Join Date
    Jul 2012
    Posts
    47
    Thanks
    3
    Thanked
    15
    Reviews
    0
    I'm pretty sure there was something similar when I bought a house with my ex back in about 2008, in Melbourne. Not sure of the exact terms, but I think by making an offer we waived our cooling off period. We did have conditions on the sale like pest and building reports, and pending finance approval

  7. #7
    Join Date
    Jul 2010
    Posts
    10,294
    Thanks
    3,115
    Thanked
    6,304
    Reviews
    0
    Achievements:Topaz Star - 500 postsAmber Star - 2,000 postsAmethyst Star - 5,000 postsEmerald Star - 10,000 posts
    Not sure which state you are in but in NSW you pay .25% of the purchase price to secure the property and you get a 5 day cooling off period - you can change your mind but you will lose the .25% - a holding deposit was something agents did here decades ago which legally they can't keep if you change your mind it was more a show of good faith and it legally meant nothing ( which is why the cooling off law came in) all our offers have to be in writing with the signed contract - this way the owners know they are all serious ( or obviously with auction there are no cooling off periods and you pay 10% immediately )

  8. #8
    Join Date
    Sep 2012
    Posts
    551
    Thanks
    779
    Thanked
    175
    Reviews
    0
    Achievements:Topaz Star - 500 posts
    Quote Originally Posted by Hollywood View Post
    We were required to put $1000 deposit on our farm, similar sort of thing I think. We were happy to pay as it was definitely the one we wanted and was the only one we had an offer on at that time. The estate agent held it in the trust account and it went towards our 10% deposit once the sale went through.
    Same with us

  9. #9
    Join Date
    Feb 2014
    Posts
    3,196
    Thanks
    312
    Thanked
    960
    Reviews
    13
    Achievements:Topaz Star - 500 postsAmber Star - 2,000 posts
    Are they meaning a deposit? We pay as little as possible $500-$1000. We're in qld

  10. #10
    Join Date
    Nov 2014
    Posts
    572
    Thanks
    164
    Thanked
    582
    Reviews
    0
    Achievements:Topaz Star - 500 posts
    No, not a deposit. More of a guarantee of your offer. If the seller rejects it you get the money back.


 

Similar Threads

  1. Replies: 0
    Last Post: 23-01-2016, 01:30
  2. Replies: 0
    Last Post: 21-08-2015, 15:29
  3. Product Recalls: eBay Trader "Crazymall"—Baby Walker
    By bhoffice in forum Product Recalls
    Replies: 0
    Last Post: 07-06-2015, 02:40

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
free weekly newsletters | sign up now!
who are these people who write great posts? meet our hubbub authors!
Learn how you can contribute to the hubbub!

reviews
learn how you can become a reviewer!

competitions

forum - chatting now
christmas gift guidesee all Red Stocking
Bamboo Lulu
Super soft, fun prints & basics for baby, made from bamboo & organic cotton plus non-toxic wooden toys. • Hypoallergenic - perfect for eczema relief • Everything needed to shop for a baby shower • 10% off + FREE gift with purchase. Use code BUBHUB
sales & new stuffsee all
Wendys Music School Melbourne
Wondering about Music Lessons? FREE 30 minute ASSESSMENT. Find out if your child is ready! Piano from age 3 years & Guitar, Singing, Drums, Violin from age 5. Lessons available for all ages. 35+ years experience. Structured program.
Use referral 'bubhub' when booking
featured supporter
Maternity Clothes
Looking to buy maternity clothes? :: Check the bubhub directory of local & online maternity clothes shops :: Find preloved maternity wear
gotcha
X

Pregnant for the first-time?

Not sure where to start? We can help!

Our Insider Programs for pregnancy first-timers will lead you step-by-step through the 14 Pregnancy Must Dos!