Conveyancing is the legal process required to transfer ownership from one legal person to another.
|Has obtained an Advanced Diploma/ Diploma of Conveyancing||Has completed tertiary study to obtain a Bachelor of Law|
|Has completed a minimum of 12 months supervised practice under a licensed conveyancer/ lawyer.||Has a vast understanding of the law and how property transactions relate to other areas of law|
|A conveyancer can only engage in conveyancing work as defined by||May be able to provide greater assistance when transactions become more complex or litigious|
|Unable to provide specific advice and would need to refer clients to a solicitor should the transaction become complex or litigious.||Able to provide advice in relation to the transaction|
Transfer of Land: The process of changing the ownership details on a Title (deed) to a parcel of land.
Volume and Folio: Volume and folios are unique identifiers used in the numbering system that identifies individual land titles.
Encumbrance: An encumbrance is an interest in a piece of land by someone other than the registered owner. Encumbrances place limitations on a property. Examples include mortgages, easements, leases and restrictive covenants.
Easement: Easements are a right held by someone to use land belonging to someone else for a specific purpose. Common examples of easements are drainage, sewerage and carriageway easements
Caveat: A legal document that individuals with a legal interest in a property can lodge to notify future prospective purchasers and third parties of their legal interest in a parcel of land.
Adverse possession: Adverse possession is a legal rule that enables the occupier of a piece of land to obtain ownership of it, provided they can prove uninterrupted and exclusive possession of the land for at least 15 years.
Joint tenants: When two or more parties own a property sharing in equal rights and obligations over the property i.e. 50/50. As joint tenants the law of survivorship applies which states that upon the death of one of the joint owners the land as a whole will pass to the surviving proprietor (surviving original owner).
Tenants in common: Where two or more parties may own a property in unequal shares i.e. 70/30. Upon the death of one of the tenants in common the deceased’s share in the property DOES NOT pass to the surviving tenant in common. Instead, the deceased’s share in the property passes to the executor/ administrator of their estate.
A cooling off period allows purchasers to terminate the contract within a certain “cooling off period” which in Victoria is 3 business days. A purchaser must request the termination in writing to the vendor. When terminating a contract during the cooling off period the purchaser incurs a penalty of $100 or 0.2% of the purchase price (whichever is greater). A cooling off period is not applicable to property’s sold at auction or under auction conditions, if the property is over 1ha and or if it is a commercial premise.
Stamp Duty is a tax imposed on all property purchases by the Victorian Government. The amount of Stamp Duty which applies to the transaction is determined by the property purchase price and may be reduced by concessions the purchaser is entitled to.
Land Tax is a payable on all Victorian Land held individually or jointly by a person where its values are equal to or exceeds $250,000 as at the 31st of December of the previous year.
The Section 32 also commonly referred to as the Vendors Statement and is the document attached to the contract of sale prepared by a Vendor which contains the information required by law to disclosed to potential purchasers.
The General Conditions are the standard terms which are included with the intention of covering many of the most important aspects of a standard transaction. Since each transaction can be different and the parties may have different needs, Contracts may also have special conditions added.
Special conditions are included by agreement and can override the standard terms, so you need to check the Special Conditions carefully.
We can help you with this either by checking the Contract before you sign it or by helping to draft the Special Conditions.
The term disbursements refer to any cost incurred on behalf of the client during the property transaction. Common disbursements include, the cost of searches to determine and or confirm the property details and any issues or encumbrances affecting the land, settlement attendance fees and the cost of general administration work with relation to the file.
We recommend that a Caveat be lodged in the Titles Office to protect your interest as purchaser. By doing so, you will be telling anyone else who tries to deal with the property that your rights come first. If you do not have a caveat on the title, there is nothing to stop the Vendor from selling or mortgaging the property, nor to stop someone else making a claim to it.
We believe that the cost of a caveat is well worth the peace of mind it offers.
A section 27 notice also commonly referred to as a request for early release of a deposit is as the name suggests a request made by the vendor to have the deposit that has already been paid by the purchasers for their property released to them prior to settlement.
Step 1: The vendor completes, signs and dates a section 27 statement, where you will need to provide various information about your existing loan which includes the amount secured by the mortgage over the property, the amount of the installments, the remaining amount required to discharge the mortgage. A vendor is also required to declare that they are not in default of the mortgage and that there are no caveats affecting the property. The information to complete the section 27 statement these days can be found on a vendor’s internet banking page for the homeloan or by looking at your most recent statement. However, if you are unsure of the specifics of your loan you will need to speak to a bank representative to obtain the relevant information to complete the form as lawyers/ conveyancer’s are unable to access this information from your bank on your behalf due to strict privacy laws.
Step 2: When speaking to the mortgagee about discharging the loan on a property for settlement, most lenders within the discharge request form will ask whether you will need a confirming s27 statement. Once your financial institution has received a completed discharge form with a request for a section 27 statement, they begin preparing the necessary documents. The banks can take anywhere from 1-2 weeks to provide section 27 confirming statement as their response times when discharging a mortgage are vastly different to their time frames when creating a new mortgage.
Step 3: Once the confirming s27 statement has been received from the bank, it is annexed to the section s27 document that has been signed by the vendor and is provided to the purchasers for their execution. Whilst many conveyancers serve the section s27 as soon as the statement is signed by the vendor, it is technically incomplete and the 28 days for the release does not begin until the bank letter confirming the details of the section 27 has also been provided to the purchaser.
Where there is a clear title which means there is no mortgage secured over the property, it is sufficient to provide a section 27 statement that has been signed and dated by the vendor to the purchaser for execution. The 28 days begins from the date section 27 statement is emailed to the purchaser.
Step 4: The purchaser’s representative has 28 days to respond to the early deposit release request. Whilst agents often push vendors to request an early release from their legal representative because it means they are paid prior to settlement; the purchaser is under no obligation to consent to the request.
Purchaser or their representative will commonly object to the early release of the deposit for the following reasons;
- A letter from the bank confirming the details of a section s27 where there is a mortgage over the property has not been annexed to the early deposit release request.
- If the amount required by the vendor to pay out the existing mortgage on a property is 80% or more of the sale price.
If there has been no objection raised by the purchaser to the section27 notice within 28 days of it being served, the deposit is released upon the expiry of the 28 days.
Land Tax: Land Tax is payable on Victorian land owned jointly or individually that is not your principal place of residence and whose dutiable value exceeds $250,000 as at 31 December of the preceding year.
The main difference for purchasers when purchasing a property at auction is that individuals are required to proceed to settlement of the parcel of land on an unconditional basis. When purchasing a property via an auction the purchaser is consenting to forego the following rights afforded to those purchasing the property via a private sale;
1. The 3 day cooling off period for the offer is not applicable
2. The transaction cannot be subject to finance
3. The transaction cannot be subject to building and or pest inspections.
Off the Plan Frequently asked Questions
There are two documents required to be provided by the vendor before your apartment is deemed complete thus triggering settlement. The Registration/ acceptance of the Plan of Subdivision and the granting of the occupancy certificate.
Occupancy Permit: This is issued when the apartment is considered suitable for occupation. An application for an occupancy permit is made to the relevant building surveyor. In deciding whether to issue an occupancy permit, the building surveyor may request certificates or statements from various practitioners involved in the construction of the building to confirm that the work complies with relevant building legislation.
Registration of the Plan of Subdivision: A plan of subdivision allows an applicant to divide land into two or more new parcels of land that can be disposed of separately. This is issued when the Plan of Subdivision is lodged The Land Titles Office for registration. Once the Plan of Subdivision is registered and the Occupancy Permit is achieved, a call for settlement will be triggered. Letters will be sent to your legal representative; requiring you to settle your apartment within the allocated timeframe.
As a purchaser what is required at settlement: Once a settlement date has been confirmed, please ensure that your finances are in place. It is very important to ensure that you are ready for settlement by the due date. Under the Contract of Sale, penalty interest will apply in the event you do not settle by the specified date.
Once settlement has been triggered, the vendors lawyers will finalise the Statement of Adjustments according to your Contract of Sale and issue it along with all other legally required documentation to your conveyancer. This Statement details all payments required to finalise settlement.
When you put in an application for a loan to buy your apartment or home, your lender will send out an independent valuer to appraise the property and get an idea of the property’s value. The vendors representative will advise you when your apartment will be ready for a bank valuation inspection.
Once your property is nearing completion, you will have an opportunity to inspect your new property 7 business days prior to settlement. If you are unable to make it to an inspection, you can nominate another or the vendor to inspect the property on your behalf.
The defects will be rectified as soon as possible. If for some reason your noted defects have not been attended to prior to settlement, these will be recorded and attended to by the builder post settlement. Please note settlement cannot be legally delayed due to the existence of minor defects.