Congratulation on your purchase!

The purpose of this guide is to provide clients with an outline as to what is involved in a conveyancing transaction and offers recommendations to help ensure a smooth process for both yourself and for us. We recognise that buying a property is a major financial and emotional event, so we aim to simplify the process and encourage your active involvement to keep you informed and reduce communication issues. This information is provided to you to assist with the settlement of your purchase and is not intended to constitute legal advice. We recommend you contact us to obtain advice specific to your circumstances.

Your Obligations

You have an obligation to bring to your Conveyancer’s attention any matters that you think may affect your interests in the transaction. Especially if financial information seems incorrect, if you plan to change the settlement date, or if you want early possession.

It is important that you respond promptly to document signing requests, especially with tight settlement deadlines.
Take prompt action in attending to any special conditions contained in the contract, which have either been stipulated or you may need to satisfy.
Ensure payments, such as deposits, are made by the dates specified in the Contract.
If you will be away before settlement, contact us to confirm document signing and provide alternate contact details.

Your Deposit

Most contracts will specify that you are required to pay a deposit amount (generally 10% of the purchase price) at the time you sign the contract or by a specified due date. You should make sure that you attend to this payment by the due date otherwise, you will be in breach of the contract which may require you to pay penalty interest on the deposit amount.

Finance

Whether or not your Contract is conditional upon finance approval, if you require finance to complete the purchase, ensure you promptly liaise with your Financial Institution and sign all necessary loan documents to avoid delays in settlement. Advise your financial institution that our office is acting on your behalf, so they have authority to deal with us in relation to your settlement and please also provide details of your lender/broker to our office.

If your contract is subject to finance approval, it will usually specify a timeframe for obtaining finance. A couple of key important things to note while you are waiting for finance approval:

If you are unable to get finance approval, the contract doesn’t end automatically. We require a letter from your bank confirming that finance was declined, and we must provide written notice to the vendor’s solicitor before the due date. In this scenario, should you wish to end the contract, the vendor must return your deposit.
Submit all requested documents to your bank promptly, as approval processes can be lengthy. Early submission helps determine your purchase status and allows us to act if necessary.

Once finance is approved, the bank will provide loan documents to be signed well in advance of the settlement date. Delays in returning these documents could result in delays in settlement and incur unnecessary costs such as penalty interest and additional legal fees.

If you are contributing extra funds for settlement in addition to the amount you are borrowing, you may need to transfer funds to our trust account prior to settlement. We shall endeavor to have settlement figures ready a week from the scheduled settlement date.

Alternatively, your bank may have the option of debiting these funds from your nominated bank account which will save you from transferring to our trust. We suggest that you speak with your bank to determine if this facility is available to you.

Purchasers Caveat

A purchaser’s caveat is a formal legal notice lodged with the Land Titles Office to protect a buyer’s interest in a property. When a buyer signs a contract of sale, they can lodge a caveat to ensure their legal interest in the property is recognised.

During the time between signing the contract and settlement, there’s a risk of other legal interests being registered on the title. For example, the vendor could make changes to the title, take out a mortgage, transfer the property, or have a creditor place a caveat on it. This could prevent your ownership from being registered.

The purchaser’s caveat acts as a warning to others of your claim on the property and stops the seller from altering the title or transferring it without acknowledging your claim. It remains in effect until the transaction is completed and the title is transferred to you. After settlement, the caveat should be withdrawn to reflect the new ownership.

Insurance

Typically, the contract states that the property remains at the risk of the vendor until settlement. However, we recommend that purchasers insure the property as soon as the contract becomes unconditional, as the vendor may lack sufficient insurance to protect the property in the event of damage before settlement.

If obtaining finance, a bank will usually require the property to be insured with their interest noted prior to settlement. You may also wish to consider obtaining title insurance to protect against any undisclosed legal defects in the title.

If the property has an active Owners Corporation, they will most likely hold Building Insurance, so you are not required to get it. However, obtaining Contents Insurance is highly recommended once you move in.

In all cases, it is better to have too much insurance than not enough.

Stamp Duty Exemptions or Concessions

Various exemptions and concessions for stamp duty are available in Victoria such as the first home buyer duty exemption (for purchases up to $600,000), first home buyer duty concession (for purchases between $600,001 and $750,000), principal place of residence concession (for purchases up to $550,000), pensioner exemption (for purchases up to $330,000), pensioner concession (for purchases between $330,001 and $750,000) and the off-the-plan concession. We are able to assist you in applying for these concessions prior to settlement. For more information please visit https://sro.vic.gov.au/

Council Rates, Water Rates, Owners Corporation & Land Tax

The vendor is obliged to pay the rates on the property up to and including the day of settlement and the purchaser is responsible for them after the settlement. We will calculate the rates adjustment and provide you with the amounts prior to settlement. Rates are adjusted by the vendor paying the rates in full for the current financial year and then you as purchaser reimburse the vendor at settlement.

We will provide you with a Statement of Account outlining all the costs and expenses involved in your purchase closer to settlement. If you need to provide any monies towards the settlement, please be prepared to action bank transfers at short notice as we often do not receive confirmation until the day before settlement. This situation can be avoided by providing your lender with authority to draw additional funds from your account and hand over monies on your behalf (as mentioned in the Finance section).

Utilities

Utility connections such as telephone, gas, electricity are your responsibility. We recommend that you contact the service provider of your choice at least seven days prior to settlement to allow sufficient time for the connection to take place. If you are purchasing a brand-new property, please be advised that it can take longer to have meters installed and you should contact the authorities early to begin the process.

Final Inspection

You are entitled to conduct a final inspection of the property in the week before settlement. You should contact the agent (or the vendor directly if there is no agent) to arrange this.

The purpose of the inspection is to establish that the property is in the same condition it was when you purchased it. If the property is not in the same condition as at the contract date, fair wear and tear excepted, you should report any substantial deterioration or damage (such as damage that may have occurred when the vendor moved out) to us immediately so we can try to resolve it prior to settlement. Once settlement has gone through, it's too late to do anything about it, which is why the final inspection is so important. It is also important to note that fair wear & tear is very broad and Vendors are under no obligation to make repairs and you cannot demand compensation or delay settlement.

Settlement

Settlements now take place via an online platform called PEXA (Property Exchange Australia), allowing electronic fund transfers and registration of documents to occur in real time. Transactions completed on PEXA have the transfer and mortgage documentation checked in advance by Land Victoria and duty on the transfer assessed by the State Revenue Office in advance. This system aims to make property transactions more efficient, secure, and less reliant on paper-based processes.

Whilst settlement will be scheduled for a specific time on the due date, it is important to note that settlement can roll over every half hour from the scheduled time it is dependent on all parties signing off, which is often delayed by the banks. The settlement process can take up to 30 minutes. You do not need to attend settlement. We will notify all rating authorities (council and water) that you are the new owner immediately after settlement. From that point on, all notices will then be sent to you by the relevant authorities.

Getting into the Property

We will be in contact with you once your settlement has taken place and we will also notify the real estate agent. The usual procedure is for the Vendor to leave keys, remote controls and other access devices with the selling agent for collection by you after settlement has taken place.

As the keys to the property cannot be collected until after settlement has taken place, we cannot guarantee the exact time you will be able to collect keys. Therefore, if you are moving into the property, we recommend that you organise your moving arrangements for the day after settlement to avoid having to delay or reschedule your moving arrangements.

Title Insurance

Title Insurance provides cover in relation to certain unknown and hidden risks:

Demolition or Upgrading Orders issued by Council in relation to structures illegally built on the property by a previous owner or in relation to illegal alterations to your property for which you are now liable to comply (maximum of $160,000 to be provided for a claimable event);
Adverse Survey Matters for properties with a land area of 50 acres or less, that would have been revealed in an up-to-date survey report;
Forced Removal of a Structures illegally built by a previous owner that encroach over an adjoining boundary;
Non-Compliance with Zoning and Planning Laws and conditions;
Non-Compliance with Easements and Covenants affecting or burdening your land;
Non-Compliance with By-Laws or Other Obligations which are registered on your title; and
Complete Loss of Legal Ownership due to a fraudulent sale or mortgage of your property.

The premium is a one-time payment, and cover provides protection for the lifetime you own the property.