Quick answer
If your finance condition is due in a week and the bank hasn't answered, you have three moves: ask the vendor in writing to extend before the date, line up a faster property-backed lender in parallel, or let the condition run and walk away. Don't go unconditional hoping approval arrives. Whichever you choose, the decision should be made while there are still working days left.
Key points
- A finance condition normally has no automatic extension. An extension needs the vendor's written agreement, signed before the date passes.
- Count working days, not calendar days. Weekends and public holidays don't count, and many agreements exclude the Christmas–New Year break too.
- Going unconditional without finance puts your deposit at risk if settlement fails.
- A parallel enquiry with a property-backed lender can run while you wait on the bank, and costs you nothing to start.
It’s Monday. Your finance condition is due Friday week, the valuer hasn’t been out, and the bank’s last email said “with credit”. The vendor’s agent is ringing. This guide is for exactly that week.
A finance condition protects you, but only while it’s alive. Once the date passes, you’re either unconditional, cancelled, or in a grey area that nobody enjoys. Here’s how to use the days you have left.
What does a finance condition actually do?
It makes your purchase depend on you getting the funding you named in the agreement, by a set date. If the funding is approved, you confirm the condition is satisfied. If it isn’t, you can usually cancel and get your deposit back, provided you took reasonable steps to arrange it.
Three things catch owners out:
- The clause is yours to manage. Nobody reminds you. The vendor’s lawyer will notice the date, not help you.
- It’s about your own reasonable efforts. Practitioners and the courts look at whether you genuinely tried. Sitting on an application, or withholding documents from the lender, can undo your right to cancel.
- The wording matters. Some agreements say “finance satisfactory to the purchaser”, others name a lender or a loan amount. Read yours before you decide anything.
Your agreement and your lawyer decide the legal position. What follows is the finance side: what can realistically happen inside the time you have.
How many working days do I really have?
Count them on a calendar, today. Working days exclude Saturdays, Sundays and public holidays, and many NZ agreements for sale and purchase also exclude the Christmas–New Year break. Check the working-day definition in your own agreement, not a general rule. Regional anniversary days can also fall inside your window, so a date that looks like Friday week may really be the Monday after.
Write the real date, and the real time, on a sticky note. Then work backwards:
| Working days left | What should be happening |
|---|---|
| 5 | Ask the bank for a firm answer and a date. Start a parallel enquiry. |
| 3 | Decide: extend, switch lender, or let it lapse. Ask your lawyer to draft any extension. |
| 1–2 | Extension signed, or finance confirmed in writing, or notice ready. |
| Due date | Nothing should be a surprise. |
Option 1: Ask the vendor to extend, in writing
Standard agreements don’t extend themselves. An extension is a change to the contract, so it needs the vendor’s written agreement before the date passes. After that date, the vendor is under no pressure to help, and may have another buyer in mind.
What makes a vendor say yes:
- A specific new date, not “a bit longer”. Offer something short and defensible, such as the valuer’s booking date or a few more working days.
- Evidence that you’re progressing: the bank has a valuation ordered, you’ve supplied everything asked.
- Something small in return, such as an agreed earlier cancellation right for the vendor if the lender declines.
Your lawyer drafts it, the vendor’s lawyer agrees it, and both parties sign. A text message from the agent isn’t a contract variation.
Option 2: Run a faster property-backed route in parallel
If the bank is the bottleneck, not you, you don’t have to wait for its answer. A property-backed lender can look at the same property, or other equity you own, while the bank continues. We cover how these loans work on our property-backed hub and on commercial property finance.
The speed claims we can stand behind are conditional: $20k to $250k possible same day (property-secured), and up to $5m possible within 24–48 hours once the file is complete. “Complete” is the weight-bearing word. In practice, it means:
- the record of title (searchable through LINZ),
- a valuation or enough information for a lender to assess the security,
- who must sign: directors, trustees, guarantors,
- the contract itself and the settlement date,
- a payout figure for anything existing on the title.
Lenders also check the borrower through the Companies Office and, for assets, the PPSR, as we set out in what NZ lenders check before they fund quickly. The more of this you hand over on day one, the less the clock eats.
A second-mortgage route, for example, can use equity in a property you already own to fund part of a purchase. See second mortgage business loans.
If you’d like a read on whether this fits your deal, check your options with a short enquiry. It takes about 60 seconds, and a real person looks at it.
Option 3: Let it lapse and walk
Sometimes walking is the right answer. If finance can’t be arranged at a price or structure that works, a properly worded finance condition lets you cancel and recover your deposit. For that to be clean:
- Show you applied properly and promptly.
- Keep every bank email and decline.
- Have your lawyer give notice in the form the agreement requires, within the time allowed.
Cancelling because the numbers no longer excite you isn’t the same as cancelling because finance failed. Courts distinguish the two.
What should you have ready whichever option you pick?
Every route above gets quicker when the same pile of paper already exists. Gather it before the last two days, not during them:
- The signed agreement and any variations, so a lender and your lawyer read the same dates and settlement terms.
- Entity details. Company number, NZBN, directors and shareholders as they appear on the Companies Office register. A mismatch between the register and the people signing is a classic stall.
- Trust paperwork if a trust is involved. Trustees often need to sign, and lawyers need time to prepare the resolutions.
- Recent bank statements for the trading business, which lenders use to size unsecured top-ups.
- A payout figure for any existing mortgage or loan over the property you’d offer as security.
- Your lawyer’s contact details, so a lender’s lawyer can talk to them directly rather than through you.
Two small habits also help. Keep a dated log of every conversation with the bank, because it’s your evidence of reasonable effort. And tell your lawyer early that you may need a short extension; they can draft it in minutes if they’re expecting it, and in days if they aren’t.
What about going unconditional and hoping?
This is the mistake that costs the most. Going unconditional means you’re committed to settle whether or not the bank comes through. If it doesn’t, the vendor can pursue the remedies in the agreement, which commonly include a notice to complete and, if you still can’t settle, cancellation and claims against the deposit and for loss.
Going unconditional is reasonable only when you hold an approval you could settle on, or a second route you can see working. The Contract and Commercial Law Act 2017 sets the rules for cancellation and damages when a contract is breached, so a failed settlement isn’t a technicality.
A worked example
A Tauranga couple’s company agrees to buy a $1.8m light-industrial unit with a finance condition. Day 8 of 10 working days, the bank says its valuation won’t be back for another week. The directors ask their lawyer to request a five-working-day extension, and the same afternoon they enquire with a property-backed lender, supplying the title, the contract and their bank statements. The vendor agrees to a short extension in writing. The bank’s approval arrives with conditions that don’t suit the settlement date, so the directors use a short-term property-backed loan to settle on time, planning to refinance later. They’d have missed the date had they waited for the answer.
That’s an illustration, not a guarantee, and every deal differs.
Questions to ask the bank today
- “What exactly is outstanding: valuation, credit sign-off, documents?”
- “What is the date by which I’ll have a yes or a no?”
- “Will approval be unconditional on the day, or will conditions remain?”
If the answers are vague, treat that as information and move your plan B forward.
Ready to see where you stand?
If the date is close and the bank is quiet, a second opinion costs you very little. Enquiring takes about 60 seconds, and your credit file isn’t touched just for asking. We don’t send your details to a pile of lenders; a real person reads your situation and calls you with the option that fits your timing. Fill the form in accurately, including the condition date and the property, so we match you to something that can actually happen first time.
Frequently asked questions
Can the vendor refuse to extend my finance condition?
Yes. An extension is a variation to the contract, so the vendor has to agree and it should be in writing, signed by both sides, before the condition date passes. If they refuse, the condition either gets satisfied or the agreement can be cancelled under its terms.
What happens if the finance condition date passes and I do nothing?
It depends on the wording in your agreement. Commonly, if the condition isn't satisfied or waived by the date, either party may cancel by notice, and the deposit is returned. Until someone cancels, the agreement can sit in limbo, which is why you should get legal advice on exactly where you stand.
Can I simply cancel because I changed my mind and say finance fell through?
No. Courts expect a purchaser to have taken genuine, reasonable steps to satisfy the condition. A buyer who doesn't try, or who sabotages their own approval, risks being treated as in breach.
Is a bank's 'approval in principle' enough to go unconditional?
Not safely. In principle usually still depends on valuation, title checks and credit sign-off. Go unconditional only on approval you could settle on, not on a verbal comfort.
Can a non-bank lender settle in time if the bank is slow?
It can be possible. Property-secured loans from $20k to $250k are possible same day once the file is complete, and up to $5m is possible within 24–48 hours. That assumes the title, valuation and signers are ready. Approval is never guaranteed.
Do I need a lawyer to extend a finance condition?
It's wise. A short variation signed by both parties is simple, but the wording and date matter. Your lawyer can draft it in a day, and the vendor's lawyer must agree to it.
Does this apply to buying a business as well as property?
The same logic applies to any conditional agreement with a finance condition, including a business purchase. Check the clause for your own agreement.