January 16, 2023

Grace period for deposits paid by direct debit

Updates to the REIQ contracts for the sale of residential property in Queensland in 2022 saw the introduction of a grace period for deposits paid by direct debit.

How Does It Work?

If the Buyer makes a transfer of deposit money by direct debit, and provides written evidence to the deposit holder (usually the agent) that they have done so, and also does not take any action to delay the payment, that payment will be taken to have been received on the day the Buyer makes the deposit.

However the grace period does have an end date. If the deposit money has still not been received by the deposit holder by 5pm two business days after the Seller gives notice that the deposit has not been received, the Buyer will be in default.

Things To Note

  • The Buyer must provide evidence that they have instructed their financial institution to make the payment on or before the deposit due date for the grace period to apply
  • Where the Buyer has provided this evidence, the Seller must give notice stating that they have not received the payment and requiring payment within 2 business days. Only after the expiry of the 2 business day period can the Seller terminate the contract.

More Questions?

If you have any questions about the grace period for payment of deposits by direct debit under the REIQ contract, or any other aspect of conveyancing in Queensland, our friendly, experienced conveyancing solicitors would love to answer them. Contact us today!

The above is not legal advice and is general information only.