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When you are purchasing a property, you may have already saved up a decent amount of money to be used for your deposit, your stamp duty and fees, etc. That is, you are contributing to the settlement funds with your savings. The money will need to be collected for the purpose of making the payment at settlement. Your conveyancing lawyer can help you to make this payment.
Generally, you can ask the bank a simple question of whether they have shortfall facilities, if they reply “yes” then you just have to sign a form that allows the bank to debit from your savings account for settlement. Shortfall facilities is nothing more than the ability to debit a savings account that you hold with the same banking institution. The shortfall account really is just your savings account itself. All you have to do is to make sure that you have enough money in that savings account for settlement.
If your bank has offered to put a limit on the savings account, which is a security mechanism for you, you should ensure that the limit is higher than the amount that your conveyancer will need at settlement, or it may slow down the preparation process. In any case, lifting the limit applied to your savings account is as easy as placing a call to your broker or banker or the bank’s settlement hotline.
If your bank offers shortfall facilities but you do not have a savings account with the same bank that you are borrowing from, then you will either need to open up a new savings account with the same bank or you will need to put money into your conveyancing lawyer’s trust account. This is because your bank will not be able to access your savings account held and controlledby a different bank.
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