What is a cooling off period?

• A cooling off period is the timeframe after a contract has been exchanged within which a purchaser may rescind the contract. In New South Wales the cooling off period starts at the time of exchange of contract and finishes at 5.00pm on the 5^th business day. Weekend days and public holidays are not counted as business days.
• A purchaser who rescinds the contract during the cooling off period may be required to forfeit 0.25% of the purchase price. This is usually deducted from the deposit paid to the vendor when the contracts were exchanged. Any remaining balance must be repaid to the purchaser. If no deposit has been paid the vendor may sue the purchaser to recover the penalty of 0.25% of the purchase price.
• Properties purchased at an auction are not subject to a cooling off period. If you are successful at auction you must proceed with the purchase immediately.
• You can use our Phone a Lawyer service for a preliminary legal consultation if you think you may need legal advice during a cooling off period.