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NEWS
On this page you'll soon find useful pieces of information and advice from our lawyers, and interesting snippets of news from around New Zealand. We will be updating it often - so keep an eye out!
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BACK TO BASICS
6th November 2009
Drill down to the basics - a fundamental rule for any transaction. Those that have ignored that in the recent past are now paying the price.
It applies to house purchases or sales as much as to cash investments. To buy a house without a building inspection or a LIM report is risky. Even if pre-approved for finance the purchase contract should still be conditional upon finance as your bank may not assess the property at the same value as you the buyer. If that happens the golden rule will apply - he who has the gold - rules. In that situation the bank will hang on to their gold.
For those that invest in debenture stock, fixed interest, and the like, the need to research just what your money is to be used for is critical. Don't get blinded by a high interest rate, there will be a reason for it. The current world-wide cash crisis is attributable in large part to a failure to observe this basic rule.
In a recent matter a client of mine was told by his valuer that no LIM report was needed. The client got a LIM and as a result the vendor had to spend nearly $10,000 fixing a problem with the property. That's a pretty good return on investment and has cost the valuer a client for life. We all make mistakes but observing this fundamental rule will help minimise the chances of a serious mistake. |
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