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52 minute read
How to Avoid Losing Your New Home to a Cash Out Clause
Learn 4 proactive ways to prepare for a cash out clause and keep your next property purchase moving.
Nurain Nadzirah
24 September 2026
Found the home you want? You might be thinking, “I’ll sort the new home first, and sell mine after.”
It’s tempting to focus on securing the new place first and worry about selling your current home once you’ve got it.
But if you’re buying before selling, there can be a deadline hanging over the purchase that you might not be expecting.
What is Cash Out Clause?
Also known as ‘escape clause’, this term in Sale and Purchase Agreement can allow a seller to consider another, potentially better offer while your purchase is still conditional.
While you might normally have several weeks to work through your conditions, a cash-out clause can reduce that timeframe to around 3–5 working days if triggered.
That’s not much time to organise a building inspection, sort your finance and get legal checks done.
The good news? You can prepare for this before you're under pressure.
Here are four practical steps to take.
1. Get your property checks moving straight away
Once your offer is signed, don't put the paperwork aside until the condition deadline gets closer. Instead, get them underway as soon as possible.
✅ What to do:
Your practical checklist:
- Order your LIM report.
- Book your building inspection.
- Send the signed agreement to your lawyer.
- Give your mortgage adviser the property details.
- Check whether your lender needs a valuation or any other information.
The goal isn't to rush your due diligence. It's to avoid leaving important jobs until the last minute.
2. Explore your bridging finance options early
If you’re planning to buy your next home while selling your current one, talk to your mortgage adviser early about whether bridging finance could work for you and what your borrowing position could look like during the transition.
✅ What to do:
Ask your mortgage adviser:
- Could bridging finance work for my situation?
- How much could I potentially borrow?
- What would my repayments look like while I own both properties?
- What would the bank need to confirm?
- What other options could I consider?
3. Have your waiver of conditions ready
If a cash out clause is triggered, you may only have a few working days to go unconditional.
✅ What to do:
Ask your lawyer to prepare the waiver of conditions in advance, so you’re ready to sign once your finance, building report and other conditions are sorted.
That way, you’re not scrambling to get the paperwork done when the clock is ticking.
4. Know when to bring your mortgage adviser in
Your lending position can change as your buying and selling plans move forward.
That’s where Tella can help. If something changes, we can help you work through the numbers and understand what you may need to do next.
For example, we can help you navigate:
- Your current home taking longer to sell.
- A change in your expected sale price.
- A change to the purchase price.
- A cash out notice.
- A shorter timeframe to go unconditional.
The earlier you get us involved, the more time we can work through your options before the deadline is looming.
Worried a cash out notice could leave you scrambling?
Let’s work through your lending position and make sure you’re prepared if the timeline changes.
A little preparation can go a long way
A cash out clause doesn't mean you should rush into buying a home or skip important checks.
It means you need to understand what needs to happen, who needs to do it and how quickly it can happen.
That way, if the seller does introduce another offer, you're prepared to deal with the deadline.
This article is for informational purposes only. It does not consider your personal financial situation or objectives. Please consult with Tella mortgage and financial experts before making any decisions regarding your mortgage or debt strategy.
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