- What is conveyancing?
- Conveyancer vs. Solicitor?
- What is gazumping?
- What is cooling off?
- What is an offer?
- What is an off-the-plan purchase?
1. What is conveyancing?
Conveyancing is the transfer of title, deed or ownership of a property, including any improvements on the land, from one person to another. In simple terms, a typical conveyancing transaction includes exchange of contracts and completion of the sale. The buyer and seller enter into a contract for sale, with all the agreement terms in writing. Conveyancing is a three-stage process – before contract, before completion, after completion.
Before a contract is forged between a buyer and a seller of a property, it is a prerequisite for the former to ensure that the latter is the real owner of the land, having the right to sell the property. The buyer makes sure that they obtain a marketable ‘title’ to the property along with all rights that run with it and that there are no restrictions on a mortgage or re-sale.
Some conveyancing contract terms may require either of the parties to perform certain obligations following the settlement, including completion of repairs to the land. In cases where none of the parties is determined to comply with such obligations following the settlement, one may approach the court for enforcement of their rights.
Role of A Solicitor in Conveyancing
You may either use services of an experienced conveyancing solicitor or a licensed conveyor for all the legalities involved with selling and buying of a land or property. Once an offer, which is subject to survey and contract, has been accepted on a property, the contract is “exchanged” and a 10% deposit is usually paid at the time of contract swapping. Solicitors from both sides then complete all the required legal documentation and hold the contract signed by the two parties. As far as a residential property is concerned, the buyer has a 5-day cooling off period, during which they may withdraw from the contract. However, in such cases, they could lose 0.25% of their deposit.
Solicitors make sure everything is in order and that you receive good title to the property, and in this regard, they offer the following conveyancing services:
- Surveys and title searches
- Scrutiny for restrictions, if any, on the land
- Confirming that all contract provisions are in order
- Ensuring that the seller has no outstanding payments on the property, including land tax, circle rates, stamp duty, water tax, among other charges property owners are required to pay
- Making provision for the payment of outstanding charges/interests, if any
- Preparing contract documents for sale of property
- Examining the other party’s contract to make sure there is no detriment to your interest
- Renegotiating terms, if required
- Examining local laws governing the land
- Before finalising the settlement, the buyer needs to conduct a final inspection to make sure there is no damage to the land. The buyer pays the balance amount to the seller on the day of settlement, with the seller handing over the keys and title deed to the buyer. However, settlement is not the completion of the conveyancing process, which also involves registration of the property deed/ownership transfer at the Land Titles Office, successfully transferring rights to the legal property title to the buyer, who would be recorded as the new owner. The conveyancing process is usually regarded as complete once the transfer documents have been submitted at the Land Titles Office, which then issue the new Certificate of Title in the name of transferee.
2. Is there any difference between a Conveyancer and a Solicitor?
A conveyancer is a specialist legal professional trained and licensed to assist sellers and buyers of a property throughout the conveyancing process. According to the Conveyancers Act 2006, a licensed conveyancer is an expert in the field of conveyancing, who cannot advise clients on the legal aspects of the conveyancing process. They must refer clients to a qualified lawyer when they need legal advise on areas outside conveyancing work.
A lawyer/solicitor, as the name suggests, is a person having the legal degree, background and training to assist clients throughout the sale and purchase of their property and the conveyancing process.
3. What is gazumping?
Gazumping occurs when a seller first accepts a verbal offer from one buyer but later refuses to formalise an agreement to go ahead with the sale in order to raise the price of the property at the last minute.
If a buyer claims to have been gazumped, the vendor is not obliged to compensate for any expenses on legal advice, inquiries, finance application costs or inspection reports, except “expression of interest” payment, which must be refunded to the buyer in full.
4. What is cooling off?
The cooling off period is a specific period of time within which the proposed buyer of a property has the option to cancel the contract. The period begins immediately once the contracts for sale are exchanged and ends on the third business day. Your conveyancing solicitor would intimate you about the beginning and expiry of the cooling off period. However, the right to cool off must be exercised in accordance with the procedure laid down in each state's legislation, the seller must be given notice that the buyer is willing to terminate the contract. The written notice must be delivered either directly to the seller or to their conveyancing solicitor.
5. What is an offer?
A formal offer is a written confirmation of the amount a buyer is willing to pay for a property. When a buyer commits themselves to writing, they become legally bound to go ahead with the purchase.
6. Define an “off-the-plan” purchase?
When you buy a land or apartment that exists only on paper as a proposed plan at the moment, it is an “off-the-plan” purchase. If the proposed plan fails to materialise within an agreed upon specified time, the contract would stand nullified and the buyers will get their money back.