Tips and Frequently Asked Questions – Conveyancing
TIPS WHEN BUYING
- Let me or one of the lawyers at Rowson Brasse & Co check the contract of sale and Section 32 statement before you sign them;
- Always make the contract subject to finance unless you have ready funds to complete the purchase;
- You should always make the contract subject to a building inspection report;
- By consulting us before you sign the contract of sale we will provide you with the appropriate wording for special conditions to protect you and suit your purposes including the proper wording for special conditions dealing with building inspections, building reports and vacant possession.
TIPS WHEN SELLING
SECTION 32 STATEMENT OR VENDOR’S STATEMENT
At a minimum, the Vendor’s Statement must contain information as to:
- rates and taxes levied against the property;
- charges and mortgages against the property;
- current property insurance;
- easement, covenants and other encumbrances against the property;
- any caveats against the property;
- any notices issued by an authority against the property; and
- planning and building permits affecting the property.
It is critical that the information provided in the Vendor’s Statement is correct and complete. An incomplete or incorrect Vendor’s Statement may allow the purchaser terminate the contract at any time before settlement.
- Selling your property is one of the most daunting decisions. Once you have made the decision to sell, you need to decide on a real estate agent. Be very diligent in your homework for the choice of a real estate agent. Let me or one of the lawyers at Rowson Brasse & Co check the retainer/contract of the real estate agent before you sign it.
- You must ensure that you provide your conveyancer or lawyer with all the details required for the preparation of the Section 32 Statement and that you allow sufficient time for the conveyancer to make all the necessary searches to obtain information that is required to be given in the Section 32 Statement.
- Do not commit to the purchase of another property until your sale has become unconditional. The appropriate special condition will need to be included in your purchase contract to protect you whilst your sale contract is still conditional.
- If the property is to be auctioned, you need to give your conveyancer at least three weeks warning before the auction date.
FREQUENTLY ASKED QUESTIONS
What is Conveyancing?
Conveyancing is the legal transfer of residential, commercial and industrial properties from a seller to a buyer or from one party to another. The conveyancer and solicitor advise the parties on their rights and obligations and assist them in completing the transfers.
The practice of conveyancing cannot be trivialised because the potential for catastrophic consequences is real. Conveyancing is a complex practice commanding a good knowledge of consumer law, planning law, domestic and commercial building law and regulation and property law.
The practice of conveyancing is being currently drastically overhauled with the phasing in of electronic conveyancing to completed by August 2019.
- Did you know that in 2016 there were 165,244 sales in Victoria with an estimated $110 billion exchanging hands?
What is Verification of Identity?
It is now a requirement that all parties to a conveyancing transaction undergo a formal Verification of Identity (VOI) process and this requirement is extended to any transaction affecting a title. We are authorised to undertake VOI as our firm is an Identity Agent. The following agents can conduct VOI on our behalf: Australia Post Offices, ID Secure and ZipID.
What is Client’s Authorisation?
It is an authority given by a party to a conveyancer or to a lawyer to allow the them to execute conveyancing documents (instruments) on behalf of the party. Such authorisation has been introduced as part of the Electronic Conveyancing National Law.
What is Section 32 Statement or Vendor’s Statement?
A section 32 Statement or Vendor’s Statement is a document which must be given to a purchaser before a purchaser signs a contract of sale for the purchase of a property. The Vendor’s Statement must contain some basic mandatory information about the property. If such information is not given or is incorrect the purchaser may have the right to terminate the contract.
What is a Cooling off Period?
The right to cool off is with the purchaser who may cool off within 3 clear business days of signing the contract of sale to purchase a property. A notice to cool off must be in writing and must be delivered to the vendor or vendor’s agent within the cooling off period. When the purchaser properly cools off, any deposit paid must be refunded except for $100 or 0.2% of the purchase whichever is more.
- The written notice can be given to the real estate agent name in the contract: section 31(3) of the Sale of Land Act.
What is a Subject to finance Clause?
We always advise our purchasers to insist that the contract of sale be subject to the purchaser obtaining a loan. We so advise irrespective of the purchaser holding a pre-approval letter from a bank. A purchaser needs a minimum of 14 days to obtain an unconditional loan approval from a bank, so the subject to finance clause must be at least 14 days from the date the vendor signs the contract of sale.
- You must do everything reasonably required to obtain a loan of the amount specified in the contract otherwise right to terminate under the finance clause may not be available.
What is a Final Inspection?
In the standard contract of sale (except of course for vacant land) a purchaser is entitled to one final inspection of the property 7 days before the settlement. If as a purchaser you need more than one inspection (for example for the purpose of bringing trades people to the property to obtain quotations), then you must negotiate the further inspections before or at the time you sign the contract
What is Vacant Possession?
The standard contract provides that the vendor must give vacant possession at settlement. The courts have said vacant possession does not mean completely empty or vacant, it means that there must be no impediment which substantially prevents or interferes with the enjoyment of the right of possession of a substantial part of the property.
What is Buying Off the Plan?
An off the plan contract of sale means a contract for the sale of land or of a dwelling that does not yet physically exist other than as a drawing or proposed plan of subdivision. An off the plan contract will have a timetable for the completion of the works by the vendor. Failure to complete the works by the time stipulated in the contract will entitle the purchaser to terminate the contract.
As from 1 July 2017, and an off the plan contract no longer affords the purchaser any stamp duty concessions except for first home buyers and for buyers who will use a dwelling as their principle place of residence.
What are conveyancing Costs?
The payment of stamp duty when purchasing a property is one of the cost of purchasing a property of the costs include loan application fees to the bank, titles office registration fees, rates and taxes and conveyancing fees.
First homes buyers with contracts signed from 1 July 2017 are exempt from stamp duty for property valued at less than $600,000. For the calculation of stamp duty click here.
What is a Caveat?
The word caveat simply means warning. A caveat against the title of a property means that a person other than the registered proprietor has an interest in the property and the caveat will usually restrict dealings with the certificate of title to the property. For instance, the caveat may restrict the transfer of the property.