When Can I get my Deposit

Congratulations - you've sold your house... the deposit is paid...... when do you get your money??

In Victoria, a seller can request to receive their deposit before settlement.

Using Section 27 of the Sale of Land Act 1962, a seller can provide information to a buyer, which is then relied upon by the buyer, to decide whether they consent to the early release of the deposit.

The process is simple, the seller and/or their Bank provides information on what money is owing and whether there is enough money in the balance of the purchase price, to payout any existing financial liabilities.

Should there be sufficient funds, and no objection from the purchaser, the deposit (less any expenses) is released to the seller. It is important that you discuss your circumstances with your conveyancer or solicitor, to decide whether your situation meets the criteria for requesting the funds.

Section 27 of the Sale of Land Act 1962 – what does it require?

The first step is for the vendor to obtain the information needed for inclusion in the Section 27 Deposit Release Statement, covering the provisions of Section 27(3)(a) and (b) of the Sale of Land Act 1962 which includes the particulars contained in Schedule 1 of the Act.

The deposit may be released under s 27(1) provided five things exist:

1. the contract is not subject to any condition enuring for the benefit of the purchaser; and
2. the purchaser has accepted title or may be deemed to have done so; and
3. the vendor has given the purchaser a notice in writing (authority) complying with Section 27(3); and
4. the purchaser is satisfied that the particulars provided are accurate and they indicate the purchase price is sufficient to discharge all moneys owing on the property. Note that the Act refers to “all mortgages” but moneys owing under caveats must also be included (see Section 27(10)); and
5. the purchaser gives the vendor a signed notice in writing to that effect within 28 days of receiving the vendor’s notice (see Section 27(4). The purchaser’s notice in writing stating satisfaction with particulars supplied is deemed to be the necessary authorisation for Section 27 compliance. If the purchaser does not supply the written acceptance within the 28 days and does nothing else, the vendor will be free to release the deposit, and the purchaser is deemed under Section 27(7) to have consented.

Disclaimer: The contents do not constitute legal advice, are not intended to be a substitute for legal advice and should not be relied upon as such. You should seek legal advice or other professional advice in relation to any particular matters you or your organisation may have.