Legal Effects of a Side Agreement

Buying and selling of properties involve careful valuation of the property by the buyer as well as the seller to make sure both get the best bargain. There are also a number of issues and procedures involved in making a smooth deal. Financing is a major issue in these deals as buyers are constantly looking for ways to get the best deals and financing options. Creative financing strategies are used by sellers to attract buyers who find it difficult to obtain enough bank loans to finance the property deal. Conveyancing solicitors in Brisbane are constantly consulted to make the transfer easy and smooth.


The first thing to do when purchasing a property you have selected is to carry out research and evaluate the appropriate price for the house. This is something that is more expertly done by the realtor but you should also carry out your own research and be aware of the trends. The next step is to arrange the finance. This is rather difficult. Lack of adequate credit availability has affected both buyers and sellers. Due to the credit crunch, it has become even more difficult for the sellers to sell their properties fast. The same credit crunch has also affected the buyers who are now finding it difficult to obtain loans after tightening up of the credit rules.


There are a number of potential buyers ready to buy properties provided that easy term loans are available. If you are selling and having a hard time finding a buyer, the answer may lie in the use of creative financing. One such method is when the seller accepts a lower purchase price as indicated on the contract. This way more loan amount can be arranged by the buyer. This side agreement, however, has legal implications. If this condition is in the contract and cannot be removed or detached from the document, there is no problem. Alternatively, there can be a likely case of fraud committed against the buyer financier. This is because the financier lends on the basis of the purchase price quoted on the contract of transfer. The actual price, however, might be much lower. This situation can be avoided if all details are discussed prior to the agreement and the financier is aware of the details.


There can be a number of complications involved in the conveyancing process in Queensland as both buyers and sellers are looking for the best options and are watching their own interests. All details and possibilities, therefore, must be discussed with qualified solicitors to make sure there is smooth handling of the transfer.

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Andrew Francey


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Andrew has over two decades experience in high growth fast moving consumer goods, agribusiness and professional services. Supporting the Ownit team to deliver on client expectations, and implementing processes to scale the organisation, is a key focus for Andrew.

Andrew is a C-Suite leader with Chairman and Board experience.  He has formal qualifications in Business, Applied Finance and AICD Company Directors Course.

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