Agreement for Possession Before Settlement: A Comprehensive Guide for Home Buyers
If you’re a home buyer in Western Australia, you may have come across the term “agreement for possession before settlement” or “AFPBS” when dealing with the Real Estate Institute of Western Australia (REIWA). This agreement allows the buyer to take possession of the property before settlement occurs, giving them the opportunity to move in and make any necessary repairs or renovations. Here’s everything you need to know about AFPBS.
What is an Agreement for Possession Before Settlement?
An AFPBS is a legally binding agreement between the buyer and the seller, which allows the buyer to take possession of the property before settlement. The agreement outlines the terms and conditions of the possession, including the duration of the possession, the rent payable, and the responsibilities of both parties.
Why would a Buyer want an AFPBS?
There are several reasons why a buyer might want to take possession of the property before settlement. For example, they may need to move in quickly due to work or personal commitments, or they may need to make repairs or renovations before they move in. An AFPBS can also give the buyer greater peace of mind, knowing that they have secured a place to live and can start making it their own.
What are the Benefits of an AFPBS?
If you’re a buyer, there are several benefits to securing an AFPBS. Firstly, you have the opportunity to move in and start making the property your own, without having to wait for settlement. Secondly, you can take care of any necessary repairs or renovations before you move in, which can save you time and money in the long run. Finally, an AFPBS can provide peace of mind, knowing that you have secured a place to live and can start planning your future.
What are the Risks of an AFPBS?
While there are many benefits to securing an AFPBS, there are also some risks involved. Firstly, if the seller is not able to settle, the buyer may be forced to vacate the property and find alternative accommodation. Secondly, if the buyer breaches any of the terms of the agreement, they may be liable for damages or rent. Finally, the rental payments can place financial strain on the buyer, particularly if settlement is delayed.
What are the Requirements for an AFPBS?
To secure an AFPBS, the buyer and seller must agree to the terms and conditions of the agreement. The agreement must be in writing and must include the duration of the possession, the amount of rent payable, and the responsibilities of both parties. The agreement must also be signed by both parties and witnessed.
Conclusion
An Agreement for Possession Before Settlement is a useful tool for home buyers who need to move in quickly, or who need to make repairs or renovations before they move in. While there are some risks involved, the benefits of an AFPBS can make it a worthwhile option for buyers. If you’re considering an AFPBS, be sure to seek legal advice and ensure that you fully understand the terms and conditions of the agreement.