Purchasers Strata Inspections Pty Ltd Online Commentary

FINANCE AND LOANS

This section of the report will tell you whether the owners corporation has borrowed money or intends to borrow money. It is a very important matter for a purchaser, because if an owners corporation has an outstanding loan then the likelihood is that the purchaser will have to contribute to the repayment of that loan after settlement of the purchase.

This can be particularly unfair if the loan was used to make the building look more attractive to the purchaser (e.g. to paint it or refurbish the foyers). This would mean that the purchaser contracted to purchase the good looking building on the assumption that payment for the work had already been made, only to discover later that they would be contributing to the cost of the work.
These types of loans are becoming more common and where they are discovered the purchaser should consider whether they are entitled to be compensated by the seller of the lot. Sometimes this type of compensation is provided for in the sale contract. Of course, if the contract has not yet been signed, then the purchaser can negotiate an allowance for the relevant share of the loan repayment, with or without taking into account interest.

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About The Commentary

This commentary has been written by Gary Bugden OAM DUniv. Gary is the Chairman of the Board of Directors of Purchasers Strata Inspections Pty Ltd.

Gary Bugden has been Australia’s leading authority on strata and community titles for the past 40 years.

He has authored numerous books and loose-leaf services on strata related subjects and has provided this commentary to assist purchasers to interpret and apply the contents of this report.

The commentary is not intended as a substitute for legal advice and purchasers should refer any concerns they have about the contents of the report to their solicitors or conveyancers for proper analysis and advice.

While every effort has been made to ensure the accuracy and relevance of this commentary, neither Gary Bugden nor Purchasers Strata Inspections Pty Ltd will accept any responsibility for any inaccuracy or incompleteness of its contents, nor if at the time of use it is out of date. They each intend to rely upon this exclusion of liability in the event that a purchaser suffers any loss or damage as a consequence of relying upon any part of this commentary.

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