The standard O&A provides that if for any rea
Most contracts allow each party 3 business days grace after the settlement date during which they can complete settlement without penalty. If settlement is delayed beyond this, the other party can charge penalty interest calculated:
- at the rate of 9% per annum on the amount due at settlement (i.e. the purchase price less the deposit paid); and
- from the settlement due date to the date settlement is completed.
The right to compensation is subject to the claimant (and their mortgagee, if any) being ready, willing and able to complete settlement on the due date.
If you’re not ready, willing and able to settle on the settlement date, your right to penalty interest starts from the date upon which you give written notice to the other party that you are ready, willing and able to settle.
If you are entitled to claim penalty interest, we will claim it on your behalf unless you instruct us otherwise.