Conveyancing is the process of transferring legal ownership of a property from one party to another.
Both buyers and sellers are required to have conveyancing done.
There are two key points in the conveyancing process – exchange and settlement.
Exchange, formally known as the exchange of contracts, is when the seller gives the buyer the right to obtain full ownership of the property. It occurs after the buyer has paid a deposit (generally 10 per cent).
Settlement, also known as completion, is when the seller gives the buyer actual ownership of the property. It occurs after the buyer has paid the entire purchase price (deposit plus balance).
One important point to note is that while conveyancing is broadly similar throughout Australia, there are differences from state to state.
Why do I need a conveyancer? Can’t I do it myself?
There is nothing to stop a buyer or seller trying to save some money by conducting their own conveyancing.
However, this could turn out to cost you more money in the long run if you make a mistake – which is possible given how technical conveyancing can be.
The reason a mistake could be costly is because you could be held legally liable if you’re late to settle or fail to settle altogether. If you’re the buyer, you might be charged penalty interest and sued for damages. If you’re the seller, you might be sued and forced to sell.
What conveyancers do for buyers
If you’re a buyer, your conveyancer will check the contract and the certificate of title. This is to confirm you get the correct property and to identify any issues that need to be addressed during the settlement process.
Your conveyancer will prepare the paperwork required for the property transfer, and will liaise with your lender and the seller’s conveyancer to ensure all parties are prepared to settle on time. This includes overseeing your payment of the rest of the purchase price, and checking the seller has paid any outstanding rates and taxes connected to the property.
Your conveyancer will also lodge documents with the authorities to ensure the property is officially transfer from the seller’s name to yours.
What conveyancers do for sellers
If you’re a seller, your conveyancer will ensure the deposit has been paid and will oversee the payment of the rest of the purchase price.
Your conveyancer will liaise with the buyer’s conveyancer to make sure all the conditions laid out in the contract are fulfilled, and to make sure all the paperwork involved in the transfer is in order.
Your conveyancer will also make sure you pay any outstanding rates and taxes connected to the property.
If the sale is going to result in the payout of your mortgage, your conveyancer will arrange a discharge authority for your home loan and will find out how much money you’ll be left with.