What are the stages of conveyancing?
What are the stages of conveyancing?
Conveyancing is an essential process when buying or selling property in Victoria. It involves a series of stages that ensure a smooth and legally sound property transaction. In this article, we’ll break down the stages of conveyancing to help you understand what to expect during this crucial process.
1. Pre-Contract Stage
Conveyancer: The first stage in the conveyancing process whether buying or selling a property is to contact a conveyancer to either review and provide advice on the sale documents for the property, or to prepare the sale documents on the property.
Buyer Due Diligence: In most cases, the property is sold ‘as is’. As such, a purchaser must undertake due diligence and ensure they’re satisfied in respect of the property. Purchasers may also obtain necessary reports such as building and pest inspections prior to signing any contract, or make any such contract subject to the inspections.
Negotiations: If any issues or concerns arise during the inspections or due diligence, negotiations between the parties may occur in addition to negotiating the purchase price, deposit amount and settlement date.
2. Contract Formation
Signing the Contract: Once both parties agree to the contract terms, they sign it, and it becomes legally binding. The buyer pays the agreed deposit, typically around 10% of the purchase price.
Cooling-Off Period: In some cases, the buyer may have a limited cooling-off period during which they can withdraw from the contract, usually within three business days. This period does not apply to auctions.
Contingent Conditions: If the purchaser is reliant upon finance to complete the purchase or there are any special conditions such as building and pest inspections which need to be satisfied, they will then arrange for the appropriate inspection or bank valuation to be undertaken.
3. Pre-Settlement Stage
Conveyancer’s Due Diligence: The buyer’s conveyancer conducts property searches and inquiries to ensure the vendor’s disclosures were accurate and confirm the property’s legal status and ownership. The extend of inquiries will vary from conveyancer to conveyancer, with more experienced conveyancers having a better understanding of what additional enquiries need to be made.
Bank Requirements: As part of the conveyancer’s role in arranging for settlement, they will contact the client’s bank to provide copies of any documents required by them or organise the discharge of mortgage, and book a time for settlement. A buyer will also need to sign and return any loan documents to their bank in readiness for settlement.
4. Settlement Stage
Final Inspection: The buyer conducts a final inspection of the property to ensure it is in the agreed-upon condition.
Settlement Statement: The conveyancer prepares a settlement statement, outlining the funds due for settlement, including the balance of the purchase price, adjustments for rates and taxes, and any fees.
Settlement: On the agreed settlement date, the buyer’s and seller’s representatives exchange documents and funds. The property title is transferred to the buyer, and the seller receives the sale proceeds.
5. Post-Settlement Stage
Change of Ownership: The conveyancer is responsible for notifying relevant authorities, such as local council, water authority and any owners corporation, of the change in property ownership. The buyer and seller are responsible for notifying their respective electricity, gas and internet providers of their connection/disconnection of services.
Finalising Legal Documents: The buyer’s conveyancer ensures that all legal documents are properly recorded and filed and provides a copy of the new title search to the purchaser.
Conclusion
Conveyancing is a multifaceted process that requires careful attention to detail and legal expertise. By understanding the stages involved, you can navigate the property transaction journey with confidence. Whether you’re buying or selling property in Victoria, working with an experienced conveyancer can help ensure that each stage of conveyancing is executed smoothly and in compliance with the law, resulting in a successful property transaction.
Further information on buying or selling property can be obtained from the State Revenue Office website here: https://www.consumer.vic.gov.au/housing/buying-and-selling-property or by contacting ConveyancingX.
