Buying a house is seen by many as one of the most important purchases you can make in your life. This means that the decision to go through the time consuming and costly process of getting the property you want can be intimidating, leaving first-time buyers feeling trapped with their decision. Luckily, you are allowed to cancel your home loan before settlement, and in this post, we’ll give you a brief rundown of how the process will play out.
First things first – Read your contract
Even if you are within your rights to cancel your home loan agreement, your contract may have stipulated certain penalties, breach of contract clauses, or amounts mentioned to recoup administrative fees in the case of cancellation. Be sure to read through your contract to make sure you understand what can be expected of you going forward.
How cancelling a home loan works
Not many people know, but before you go into settlement you are fully within your rights to cancel a home loan agreement. That being said, you should make absolutely sure that you cover all your bases, and that starts with your first step, phoning your lender.
While speaking to the lender, you might have to supply a reason for cancelling, which will give the lender the necessary information to let you know if you have incurred any penalties for cancelling.
Once that is done, make sure that you take down the time and date of the phone call, after which you should cancel your home loan in writing. Yes, you just had the discussion with your lender, but by ensuring that they receive a signed declaration of your decision to cancel, this can only help you in the long run, if you run into any problems.
As we said above, be sure to sign your declaration, and make some copies, just to make sure you have documentation on file. Keep in mind that with your physical copy, you can also send one as an email attachment just to cover all your bases.
If you need any help with cancelling your home loan contract, or want to know exactly what your rights are, you are welcome to contact us as soon as possible.