You're approaching settlement day when you receive a call or email: the buyer needs more time.
For sellers, a settlement delay can be frustrating, particularly when you've already booked removalists, arranged utilities or have another property transaction depending on the agreed settlement date.
So, what happens if a buyer asks to delay settlement, and what can you do?
Why might a buyer ask to delay settlement?
There are several reasons a buyer may not be ready to settle on the agreed date.
Finance or lender delays: Even if finance has been approved, outstanding loan documents, valuations or lender requirements may affect when funds are available.
Their property sale has been delayed: A buyer may be relying on proceeds from another property sale. If that settlement is delayed, it may affect their ability to complete your transaction.
Outstanding documents: Verification of identity, transfer documents, duty requirements or other paperwork can sometimes hold up settlement.
Banking or electronic settlement issues: Property settlements in WA are generally completed electronically, and occasional banking or system issues can affect timing.
Understanding why the buyer is requesting additional time is important. A short administrative delay may require a different response from a more significant issue affecting their ability to complete the purchase.
Does a request automatically change the settlement date?
No. The agreed settlement date forms part of your property contract, and a buyer requesting more time does not automatically change it.
If you are considering an extension, speak with your settlement agent or lawyer before agreeing. Your contract may contain conditions relevant to delayed settlement, and changing the date may affect your rights and obligations.
If you are still preparing for settlement, SettleHQ offers a complimentary contract review when you proceed with a settlement firm through the platform, helping you better understand important conditions before settlement.
What are your options as the seller?
Your next step will depend on the reason for the delay, your contract and how an extension could affect you.
Consider a short extension
If the reason is clear and the proposed delay is manageable, you may choose to agree to another settlement date. Make sure the new date is specific and any agreed change is properly documented.
Keep the existing settlement date
You may decide an extension doesn't work for you, particularly if your own moving arrangements or another property transaction depend on the original date. Speak with your settlement agent about what maintaining the existing date means for your transaction.
Ask for more information
Before making a decision, find out why the buyer needs additional time and how long they expect the delay to last.
A short lender processing issue may be very different from a buyer experiencing a significant finance problem.
Seek advice if the situation becomes more serious
If the delay develops into a contractual default or dispute, obtain appropriate professional advice before taking further action.
Check that your side is ready too
Before assuming the buyer is responsible for the delay, make sure everything required from your side has been completed.
For example, if you have an existing mortgage, your lender may need sufficient time to process the mortgage discharge.
Your settlement agent can help identify outstanding requirements on either side and determine what may be preventing settlement from proceeding.
How can your settlement agent help?
Your settlement agent plays an important role when an unexpected delay occurs.
Depending on the circumstances, they can communicate with the buyer's representative, identify what is holding up settlement, coordinate outstanding documentation and explain the practical steps required to keep the transaction moving.
They can also identify when an issue has moved beyond the normal settlement process and when legal advice may be appropriate.
If you haven't appointed a settlement agent yet, see how SettleHQ works to understand how you can compare WA settlement firms based on your transaction and requirements.
What should you do now?
If a buyer has asked to delay settlement:
- Speak with your settlement agent before responding.
- Ask for the reason and proposed new date in writing.
- Check that everything required from your side is ready.
- Consider how the extension could affect your moving plans or another property transaction.
- Make sure any agreed change is properly documented.
- Seek legal advice if the matter develops into a dispute or contractual default.
Acting early gives your settlement agent more time to understand the issue and help you navigate the next steps.
Get the right settlement support
A buyer asking to delay settlement can add uncertainty to an already busy time. Having the right settlement professional involved can help you understand what is causing the delay and what practical options are available.
SettleHQ makes it easy to compare settlement agents in our WA network and find a firm suited to your property transaction.
