A behind-the-scenes guide to conveyancing
Wouldn’t it be nice if buying a home was simply a matter of exchanging bank details with the vendor and then transferring the cash?
Unfortunately, it’ll never be that easy.
There’s paperwork, paperwork and more paperwork, starting with your loan application and everything that goes along with it.
And then there’s your conveyancer. Who’s that, you ask?
Well, they actually remove some of that legwork and sort out a lot of the important paperwork for you.
Let us explain.
What does a conveyancer do?
A conveyancer is someone who prepares the documentation for the sale/transfer of a property, and offers advice on aspects of that sale throughout the process.
Some conveyancers are lawyers and some aren’t, however they’re all licensed to act in the role.
Conveyancing in a nutshell, is the process of transferring a property’s title deed from one person to another. And then along the way there are certain checks and balances that you do over the title and over the property.
Among the tasks a conveyancer will perform for you is the preparation and lodgment of all legal documents relating to the property, including the contract of sale. They’ll also research the property’s title, to check for any issues and ensure everything is as it should be.
Read more: how conveyancing works
The title and transferring it is the underlying principle to conveyancing, but the searches and all of those certificates that we obtain are part of the practical application of that conveyancing.
They’ll also calculate the rates and taxes based the property’s new sale price, and they’ll act on your behalf when it comes to settling the property – letting you know when it’s all done and advising your lender when you’re making the final payment to the vendor.
Do you need one?
Technically no, you don’t need a conveyancer, however as you might already have guessed, wading through the titles and contracts and all of that other work will be extremely challenging if you don’t know what you’re doing.
You’re well advised to engage a conveyancer as part of the sale process, to ensure every I is dotted and T crossed.
How much does a conveyancer cost?
While some conveyancers can be hired cheaply, most conveyancers cost between $1000-1500.
That said, for multimillion-dollar homes you can expect to pay significantly more, as the risk for the conveyancer (if they make an error and are sued) is greater.
The conveyancing fees for a good operator would be about $1000, and then you’ve got your out of pocket expenses, which could be about $400 to $500.
You’d budget about $1500, give or take a few hundred either side. That’s a standard sort of transaction.
What issues might you encounter?
The costliest problem for buyers is when there’s a problem with the property title, as it will cost someone a lot of money in legal fees to fix it.
But the vast majority of issues encountered stem from banks and lenders not being ready to proceed on the settlement date.
When a settlement falls over, 90% of the time it’s caused by human error, and of that 90% that fall over, I would have to say 70-80% of that error would be with the banks.
My advice to a client is be proactive and get on the front foot with your broker or banker, and make sure your finance is sorted out and that your bank can settle on the due date.
Your conveyancing checklist
Ask if your prospective conveyancer is a member of the Australian Institute of Conveyancers.
Ask about their fees and charges. Is it all upfront, or are their other costs you’ll have to pay upon settlement?
Ask for examples of the types of properties they’ve previously acted as the conveyancer for.
Ask them to put together a timeline that maps out each stage of the property purchasing process.
This article first appeared in www.realestate.com.au