If you’re selling or buying a home in Australia, you will likely use the services of a conveyancer to help you handle the legal work of the process. There are many steps involved in buying a home. Sometimes there are so many steps involved that a home buyer can find it hard to know what to do, who to contact and when is the right time to do so.
This guide will explain in detail, everything you need to know about conveyancing when you are buying a home. So whether you are looking for what a conveyancer is, what the difference between a solicitor and a conveyancer is, what you can expect from them or the costs involved - you’re in the right place.
What is conveyancing?
Conveyancing is the process of transferring the legal ownership of the land to the new owner.
Conveyancing involves preparing, verifying and lodging the various legal documents associated with home buying and selling, as well as preparing the contract for settlement.
The conveyancing process operates at all stages of home buyer, across:
- pre-contract
- pre-completion
- post-completion
Not handing in the appropriate legal paperwork correctly by the required dates can result in the contracts being void. This could mean that you lose both your dream home and some deposit you’ve paid.
Your conveyancer or solicitor can help initiate and undertake the conveyancing process. They make sure you complete all of the legal requirements in the purchasing process.
What is a conveyancer?
The main role of a conveyancer is to ensure that the certificate of title on a property is successfully transferred from a seller to the purchaser. They will also advise the vendor or purchaser of any legal issues along the way, relating to the purchase. They oversee the entire legal process.
Both a seller and a buyer will have a conveyancer and it is their job to communicate and take care of the process once the sale has been agreed upon. This includes negotiating contract terms, facilitating settlement and ensuring funds have been settled in relation to the purchase.
It is really important to engage a professional in this process because, without someone who has extensive knowledge of the industry to guide you, it can be really difficult to navigate your rights and obligations when you come across issues with the purchase. A conveyancer undertakes property transactions daily and knows what to look for in contracts and how to structure legal negotiations.
DIY conveyancing can end up being a painful process, but also one which can take up significant amounts of time and carries a large risk if things are missed.
What does a conveyancer help with?
As mentioned, your conveyancer will help with all of the paperwork and legal obligations involved with your purchase or sale.
If you are purchasing with someone your conveyancer will also help with the legal structures of this process, like the set up of a ‘tenants in common’ or ‘joint tenants’ relationship. They can also set up your home as an investment or in a self-managed super fund.
You will need a conveyancer during the selling process too. They will facilitate the transfer of property, transfer of ownership, property settlement and mortgage discharge from your lender.
If you are selling, a conveyancer will help with the Contract of Sale Preparation
- Prepare and lodge all the legal documents needed for a sale, including drafting the contract of sale
- They will help facilitate the discharge of the mortgage with your bank or financial institution
- Organise the release of the home deposit to you from the purchaser
- Secure title documents from you to allow for the transfer of the home to the buyer
- Handle all contract negotiations, delays and extension requests. Essentially advising on all communications with the buyer within the purchase timeframe
If you are buying, a conveyancer will help with Contract of Sale Review
- Review, prepare, negotiate and lodge all the legal documents, such as the contract of sale and the Transfer of Land documents
- Research and advise on property titles; check for any third-party rights to enter or use the land, such as easements that affect the block of land or upcoming developments with local council
- Help you understand exactly what you're purchasing and the terms in which you are doing so, they will support you in getting all your checks done within the cooling-off period.
- Hold funds on your behalf in their trust account and disburse trust funds according to your instructions for example the settlement process
- Deal with the vendor and real estate agent on your behalf including negotiations in relation to the contract (not negotiations on purchase price)
- Deal with your bank or financial institution and coordinate payments at settlement and ensure this happens on time (they will not negotiate with your lender on interest rates or help you get the loan)
- Support with the payment or waivers of stamp duty fees.
How do I find a conveyancer?
It is important to ensure that you are engaging a licensed conveyancer.
The conveyancing laws and processes will differ from state to state.
The Australian Institute of Conveyancers NSW Division, provides a free tool that so consumers can find a conveyancing business in the locality that most suits their needs. You can search for a conveyancer on their website. The Victoria division also has a search tool to find a conveyancer.
How much does a conveyancer cost?
Conveyancing fees can depend on the complexity of the sale or purchase as well as the provider you choose to go with. It is crucial that you find a good conveyancer and one that is well-trusted to ensure the process of purchasing your home goes smoothly.
A conveyancer typically costs $1000-$2000 when purchasing a home.
There are now digital providers of the conveyancing process alongside more traditional conveyancing services.
Other costs come up within the conveyancing process that aren't fees paid to the conveyancer but ones owed to the seller. This is called the statement of adjustments. For example, these can include:
- Pro-rated council rates for the period of the quarter that you own the home
- Pro-rated strata levies (if applicable)
- Disbursements
These typically add up to a few thousand dollars extra at the time of settlement.
Check out our summary of the expected upfront costs that can come with buying a home.
Arranging and attending settlement
Settlement used to be a physical event at a court, but nowadays, it is done digitally.
Settlement is the process of paying the remaining sale price of the home and becoming the legal owner. Generally, in NSW, this occurs around six weeks after contracts are exchanged, but this will depend on the negotiations with the vendor.
Settlement is attended by the conveyancer of both parties and lenders. Your conveyancer will inform you about the time and day of settlement shortly after the purchase.
At the time of settlement, your lender will distribute the remaining balance of funds for your home loan to the real estate or conveyancers trust account. This is the purchase price of the property, less any deposits paid. Once this occurs, it is paid to the owner's account.
At this point, once funds have been settled, you will receive the keys to your new home!
At OwnHome, we help all customers navigate home purchases and get onto the property ladder, without needing hundreds of thousands up front in deposit savings. If you’re hoping to get onto the property ladder and would like to learn more you can use the buying power calculator to find out your borrowing power or sign up to talk to someone from the team.
