Role of A Conveyancer in The Property Settlement Process
Settlement is a legal process that involves multiple formalities between buying and selling parties. It is an important process that should be completed in the presence of an experienced conveyancer. Otherwise, there is a chance of missing an important task or committing some mistakes during the process. And, no one wants any issues when the property transaction is about to complete. That’s why, the ideal approach for settlement is having a knowledgeable conveyancer on your side.
Below we have explained the settlement process along with the role of the conveyancer at different stages. But, first of all, let’s check out what property settlement is.
What is Property Settlement?
Property settlement refers to transferring property ownership from the seller’s name to the buyer’s name. Both parties meet along with their own conveyancing experts and complete multiple legal formalities. Like exchanging the documents, settling the dues, and finally handing over the property keys to the buyer. It is the final and one of the most important steps while buying or selling a property.
How Many Days Does Property Settlement Take?
There is no hard and fast rule to complete the settlement in a certain number of days. The number of days can increase or decrease depending on the state in which the property is located. However, the process takes between 30 to 90 days in most cases. (Note: For the properties at which construction is still going on, the settlement duration is extended)
The process is initiated when both parties sign the property contracts. On the same day, a date is finalised at which the property settlement is supposed to happen. So, both parties already know the exact date on which they need to settle things. Meanwhile, the days between the initiation of the deal and settlement can be used for tasks like title searches, relocation, making financial arrangements and other similar things.
Duties of Different Individuals Involved in The Settlement Process
During the weeks which lead to the settlement day, various individuals perform different activities. To give you more clarity over this, we have explained the duties of different individuals below.
Seller’s Conveyancer
- Prepares legal documents and conducts title searches
- Interact with buyers and complete various tasks collaboratively
- Guides clients on various legal matters
- Decides a settlement date by having discussions with the discharging lender
Seller
- Signs the client authorisation form after undergoing identity verification with the legal representative
- Completes the formalities to discontinue the water and power connection
- Verifies and sign the discharge authority form and hand it over to the discharging lender
Buyer
- Verifies the identity with the legal representative and signs the sale contract
- Verifies & signs the loan documents and submits them to the lender
- Stays in touch with the legal representative and pays the stamp duty
- Gets the property keys from the seller or real estate agent
Buyer’s Conveyancer
- Analyses the sale contract and makes sure it is error-free and includes the special conditions as well.
- Assists clients during various processes and helps them make the right decisions.
- Discusses with the incoming lender and decide on a date for settlement.
- Manages all the finances related to the process and reverts to the seller’s requests.
What is A Contract of Sale?
The contract of sale is a legal document that consists of terms & conditions on which both buying and selling parties agree. This document is generally prepared when a particular property is initially made available for sale in the market.
The Contract of Sale is created and edited by a conveyancer or solicitor. In some cases, the real estate agents of the selling party also prepare this document. It includes details like deposit money, date of settlement, property’s legal description, conditions of sale, details of buyer & seller, etc.
What Is A Title Search?
It is the process in which conveyancers search the respective land or property to verify the Certificate of Title (CT). The CT allows you to go through the legal public record of the property, along with the restrictions and interests that apply to the land. It ensures that the buyer knows all the important information related to the property well in advance.
The title search process completed by a conveyancer reveals the following important details related to the property:
- Easements
They refer to special rights given to an individual for a particular purpose who does not possess ownership of the property.
- Covenants
They refer to the boundations on the respective land. Which type of building can be built? What are the safety guidelines and materials that should be used? and many more.
- Mortgage
A mortgage is a loan amount that a bank or similar organisation provides in exchange for property rights. Before the settlement day, one must make sure that the property’s mortgage is discharged.
What is The Cooling Off Period?
It refers to the duration of a few days within which the buyers can skip buying the property if they change their mind or for any other similar reason. And, the buyers get all their deposits back and just have to pay the cooling-off termination charges in some cases. However, in some Australian states, there is no provision for a cooling-off period. For this reason, the buyers should confirm all the rules & regulations from their respective conveyancer or solicitor well in advance.
In the following cases, the cooling-off period is not applicable:
- If you buy a property in an auction then there is no provision for a cooling-off period.
- If you purchase a property listed for auction but sold via any other method and the contract starts close to the date of auction.
What is A Settlement Statement?
A “Settlement Statement” or “Settlement Adjustment Sheet” is a document consisting of the various amounts that the buyer has to pay to the sellers on settlement day. Generally, it includes legal costs, land transfer duty, & other similar deposits, and is prepared by the legal representative of the buyer.
Moreover, the adjustments for advance payments like water rates, council rates, etc., are also included in this document. Both buying and selling parties should get the settlement statement checked by their conveyancers before finally completing the settlement formalities.
Conclusion
Settlement is an important process in transferring property ownership from seller to buyer. A conveyancer is a legal expert who plays an important role in the settlement process at different stages. So, if you want to buy or sell a property without any issues, hiring a reputable conveyancer should be your top-most priority. It helps you not only complete the settlement process effectively but also makes other legal formalities smooth and efficient for you.
