In many cases when buying property, the purchaser will not have cash to pay for the property, and therefore will require finance to assist in the purchase.  A bank will not normally provide unconditional finance approval without sighting a fully signed Contract of Sale.  Therefore a finance approval clause is often used, allowing the purchaser a certain period of time (usually around 3 weeks) to obtain the required approval from their bank.  Such clause should always be written into the Contract of Sale at the time of signing.

This clause for finance approval allows the purchaser a certain period of time in order to get the formal unconditional approval from their bank.  Should they be approved, the Contract will continue to settlement.  Should they be declined, the Purchaser can withdraw from the Contract and receive reimbursement of any deposit paid.