Conveyancing is the legal process of transferring the ownership of real property (land and / or water) from one party to another. It may sound simple, but there are important steps involved and you need good legal advice.
Even with a lawyer or conveyancer to help you, selling or buying a property can be daunting.
This article is an easy to understand outline of the basic steps involved in a conveyance of land in New South Wales. Please call KS Law if you are seeking more detailed advice.
Marketing
- Marketing of property by real estate agent – your real estate agent will require a “listing contract” prepared by us containing all required certificates and specific terms and conditions.
- Offer made by purchaser and accepted (if the purchaser is borrowing for the purchase, ideally they will have finance pre-approved at this stage).
- Real estate agent issues a written sales advice containing the basic terms of sale, including the price, deposit and settlement period (usually 6 weeks after exchange of contracts occurs, but this is variable and subject to negotiation).
Before Exchange
- Inspection Reports obtained by purchaser (e.g. pest and building report and / or strata or survey report). We can help you obtain these reports, or the real estate agent may do so.
- Purchaser’s bank (if the purchaser is borrowing) confirms finance approval following a valuation of the property.
- Parties receive legal advice (and if applicable accounting and / or financial advice) and contract terms are negotiated and agreed.
- Contract signed. Two identical copies are signed, one by each party.
Exchange
- Deposit paid by purchaser to the trust account of the real estate agent, where it is held on trust under the terms of the contract.
- Signed contracts are exchanged forming a binding legal agreement. For residential property this is subject to a 5 day cooling off period unless cooling off rights have been waived (as is required in most cases). The Contract will specify the settlement or “completion” date (usually 6 weeks after exchange).
Auction Sales
If you are buying at auction, exchange of contracts occurs (meaning you are legally bound to settle the purchase) “when the hammer falls” so it is extremely important that:
- if you are borrowing money to fund the purchase, you have unconditional loan approval in place for the purchase of the property prior to the auction;
- you have funds available to pay the deposit (usually 10% of the purchase price) at the auction; and
- you obtain legal advice on the contract prior to the auction – ideally, you should request the real estate agent to provide a copy of the contract to us at least 24 hours prior to the auction (the earlier the better).
Following Exchange
- An electronic workspace is set up to facilitate settlement.
- Loan and mortgage documents are signed with incoming mortgagee and the outgoing mortgagee arranges a discharge of the existing mortgage.
- Statutory enquiries and searches are undertaken and legal requisitions relating to the land are issued to ensure title is as represented in the Contract.
- Transfer form and notice of sale are prepared.
- Contract and transfer are stamped by Revenue NSW, with stamp duty to be paid now or (if you are borrowing the funds) on settlement if within the statutory timeframe.
- Settlement adjustments (for rates, taxes, levies etc) are prepared and agreed.
- Final property inspection undertaken (by you with the real estate agent) and final title searches are undertaken by us.
- Financial details are entered into the electronic workspace and are verified by us and signed ready for settlement.
- Transfer and other required documents are signed by us on your behalf in the electronic workspace ready for settlement.
Settlement and Registration
- Settlement occurs – settlement monies for the purchase price and all fees and expenses are disbursed electronically and the transfer and any discharge of mortgage and / or new mortgage are immediately registered at NSW Lands Registry.
For more information or a fixed price quote, please contact KS Law.
The content of this article is intended to provide a general guide to the subject matter. Specialist individual advice should be sought about your specific circumstances.
