Understanding the Initial Deposit vs Balance Deposit in a New South Wales Property Contract

1. Plain English Definition

"Initial Deposit vs Balance Deposit" means the splitting of the standard 10% property deposit into two separate payments during a real estate transaction. The initial deposit (typically 0.25% of the purchase price) is paid to secure the property and start the cooling-off period, while the balance deposit (the remaining 9.75%) must be paid before this period ends to make the agreement fully binding. If you fail to pay the balance deposit on time, the seller can cancel the purchase and keep your initial payment.

2. The Danger Zone: Buyer's Risk

• **Forfeiture of the 0.25% holding