An SA buyer's contract has a finance condition dated 15 March, and the bank has not approved the loan by then. What happens?
Correct Answer
D) The purchaser must give notice under the clause, and the contract then ends on its terms
Standard SA sale contracts make the finance condition operate through notice: a purchaser who has not obtained approval must give the vendor notice in the way the clause requires, and the contract then ends in accordance with its terms, usually with the deposit refunded. The exact wording and deadline come from the contract, so the purchaser's conveyancer should act before the finance date.
Why This Is the Correct Answer
A finance condition does not end the contract by itself. The purchaser must give the notice the clause requires, and the contract then ends in accordance with its terms, usually with a refund of the deposit.
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