Most people go through property conveyancing only a handful of times in their life. So, the entire process of buying, selling, and transferring or subdividing a property can intimidate a non-lawyer or non-realtor. Conveyancing is not that complicated, though—if you hire an experienced solicitor specialising in property, you can be sure that the conveyancing will progress as it should. Here are the stages in conveyancing and what to expect at each.
Stage One: Preparing the Contract of Sale
The first stage involves the vendor requesting the solicitor or conveyancer to prepare a contract of sale. At this stage, the vendor should be ready to discuss inclusions and exclusions. They must inform the buyer what they intend to take with them or leave behind.
The buyer can negotiate the terms of a contract. Usually, one can do this through a real estate agent, but the buyer and seller can negotiate if they have no agents. In either case, the conveyancer or solicitor will prepare the contract and include conditional clauses that either party wants to put in. After both sides have reviewed, agreed, and signed the contract, they can proceed to the next stage.
Stage Two: Exchange of Contracts
After the parties have exchanged signed contracts, these are considered legally binding. The purchaser will also have paid a deposit at this point. Typically, the deposit represents up to ten per cent of the purchase price. A down payment like this lets the vendors and their agents know that the buyer is committed to obtaining ownership.
Stage Three: The ‘Cooling-off’ Period
After the contract exchange, there is a cooling-off period where either party can legally back out of the purchase. Purchasers should remember that they must still pay the vendor a portion of the purchase price if they cancel—in Queensland, that could be up to .25 per cent of the total. Note as well that if the buyer purchases at an auction, there will be no cooling-off period.
Stage Four: Building and Pest Inspection
After the cooling-off period, the buyer’s solicitor will recommend that they request a building and pest inspection of the property. This process ensures that the property does not have live termites and is of sound structure. This stage is a good time to confirm if the mortgage lender has approved the loan for the property.
Stage Five: Paying Stamp Duty
Stamp or transfer duty is a one-off tax applicable to property transfer or purchases. Solicitors and conveyancing lawyers can help you calculate how much stamp duty you have to pay. If you are buying your first home, you could be eligible for reduced rates or even exemptions.
Otherwise, your conveyancer will take over this portion of the property transfer—you would only need to sign additional forms like transfer documents. If the settlement is electronic, you might not need any input, and the solicitor could handle the entire process. Note that if the solicitor requests that you sign a document, you need to attend to it as soon as possible to avoid bottlenecks in the settlement.
Stage Six: Mortgage Payout and Adjustments
After the purchaser settles the stamp duty, the vendor’s conveyancer will work with the bank to determine the amount left on any mortgages. Meanwhile, the buyer’s solicitor will calculate for adjustments like water rates, council rates, strata levies, and the like up to the settlement date.
If the property has tenants, the purchaser’s representative will coordinate with them or the vendor’s property manager to ensure up-to-date rent payments. If there are outstanding monies at the time of the settlement, either the vendor or purchaser can pay for them. The contract they signed should have outlined which party would pay in this situation.
Stage Seven: Booking the Settlement
Finally, both sides’ solicitors will confirm the date and time of the settlement with their clients. It will take anywhere from 15 to 30 minutes to complete a settlement after all the financial aspects are balanced and signed off. After this stage, the solicitor will inform their clients that the process is complete.
Buying or selling a home involves more than just shaking on a deal and money exchanging hands. For a house sale to be legal in Queensland, it has to undergo conveyancing. When on the market for a conveyancer, be sure to get one who knows the process inside out.
Hire Bickell and Mackenzie as your conveyancing managers in Redland Bay. Our firm specialises in property transfer and conveyance, and we aim to provide modern and efficient services in every transaction. Speak to our friendly team today for enquiries!