The changing landscape of conveyancing

BMT team — Mon, 01 Jul 2019 01:32:44 +0000

The conveyancing landscape is rapidly evolving to keep up with our digitally driven world. With advancements in technology, the conveyancing process can now be done online. This is known as e-conveyancing. What is e-conveyancing? Conveyancing refers to the process of transferring ownership of a property and has traditionally been complex and time consuming. Also known as electronic settlement, e-conveyancing is now paving the way for a more refined, streamlined property transaction process. It reduces the manual paperwork involved in property exchange by allowing multiple parties to transact together on a digital platform, generally provided by Property Exchange Australia (PEXA). Using this platform, financial institutions, lawyers and conveyancers can all access relevant records and legal documentation required to settle a property transaction. Supported by the property industry, e-conveyancing was spearheaded by the government to bring the multifaceted process of conveyancing into a digital environment. E-conveyancing legislation In 2012, e-conveyancing legislation was introduced in the form of the Electronic Conveyancing National Law 2012. This legislation mandates the transitioning from conveyancing to electronic settlement in Australia and is implemented by separate legislation in each state and territory. In 2018, it became compulsory in most states (excluding Australian Capital Territory, Northern Territory and Tasmania) to electronically lodge all caveats and standalone transfers, along with mortgages, refinances and discharges of mortgage. New South Wales and Victoria have transitioned to 100 per cent electronic conveyancing and will phase out paper certificates of title by July 2019. How to settle online Settlements conducted through digital platforms remove the requirement for hard copy documents. This means financial institutions, lawyers and conveyancers don’t need to be physically present at settlement. To start the e-conveyancing process, one of the parties will create an electronic workspace on a platform like PEXA. Once this space is created other parties are invited to join. Formed in 2010 by the Council of Australian Governments, PEXA is an online property exchange network that assists members to lodge documents with Land Registries and complete financial settlements electronically. Services like PEXA reduce the preparation and attendance previously required at settlement and limit post-settlement tasks such as payments and notification requirements. Using these services, conveyancers and solicitors can conduct title searches, lodge documents and transfer funds. What are the benefits? The main benefit of e-conveyancing is its convenience. Electronic settlement can be performed regardless of location, meaning documentation can be easily accessed by relevant parties. This accessibility allows for better transparency between the seller and buyer by keeping them updated on any transaction developments. Notifications also inform financial institutions, conveyancers and solicitors of what needs to be lodged and can help to speed up the settlement. While there are many benefits to electronic settlement, it’s important to be aware of the difficulties involved. The main challenge is making sure all relevant parties understand how to use electronic settlement platforms. Given e-conveyancing is relatively new, training may need to be implemented to ensure all parties have the appropriate skills. E-conveyancing also assumes that individuals have access to the internet. For more information and advice on conveyancing, read ‘Choosing a Conveyancer or Solicitor for your investment property’.

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Navigating the property settlement process

BMT team — Wed, 23 Jan 2019 00:01:03 +0000

If buying an investment property was a race, then settlement would be considered the finish line and your prize would be finally taking legal possession of your property. The property settlement process can be daunting, but with a little understanding of the process and the right preparation, the keys to your property will be yours before you know it. What is property settlement? Property settlement is the legal process that is facilitated between your financial and legal representatives and those of the property’s vendor. The vendor sets the settlement date in the contract of sale. As a general rule, property settlement periods are usually thirty to sixty days. Who takes care of what on settlement day? Settlement day occurs when your solicitor or conveyancer meets with your lender and the vendor’s agents at an agreed time and place to exchange documents and arrange for the balance of the purchase price to be paid. Your lender will: Register a mortgage against the title of your new property Release the funds to purchase the new property Your solicitor or conveyancer checks that: Any existing mortgage on the title to the vendor is finalised Any third party or person who has rights over the property (a caveat) is removed All clauses on the sales contract are fulfilled The transfer of land and mortgage is registered with the title office in your state or territory Make sure you’ve got enough money set aside to cover Stamp duty Lenders mortgage insurance Building and contents insurance Other fees and charges Complete a final inspection of the property Just before settlement, you’ll have the opportunity to do a final inspection of the property. Often this is done the day before or the morning of the settlement. The vendor must hand over the property in the same condition as when it was sold. When you view the property for the final time you should check: The appliances, hot water system, heating and cooling are all in working order Structure, walls, light fittings, window and floor coverings are in the same condition as when you first saw the property Locks, keys and automatic garage door controls are supplied and working You can organise a defects inspection by a Building Inspector if you don’t feel confident in checking these things yourself. What happens after settlement? After settlement, your lender will draw down on your loan. This means that they’ll debit the amount they’ve paid at settlement from your loan account. You’re then responsible for paying land transfer duty or stamp duty. It’s usually paid on the settlement date. The title to the property won’t be transferred to your name until you have paid this duty. Once settlement is completed, you can collect the keys from the agent and take possession of your new property. If you have purchased an investment property, organise a depreciation schedule A depreciation schedule prepared by BMT Tax Depreciation helps to maximise the cash return from your investment property each financial year. To ensure that you claim the maximum depreciation deductions, a BMT Tax Depreciation Schedule will last for the life of the property or for forty years, as specified by the Australian Taxation Office. BMT also provide a free, easy to use tax depreciation calculator, which can assist you with an estimate of available deductions for any property. Alternatively, you can contact one of our expert staff on 1300 728 726 for a free estimate of available deductions.

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The changing landscape of conveyancing

Navigating the property settlement process