FAQ - ConveyancingThe below information should not be relied upon as formal legal advice by BCK. Individual circumstances may vary the advice we give to you and your available options. We recommend you contact one of our lawyers skilled in the area to discuss your situation and if required, make an appointment to attend our offices to provide detailed instructions so that we can appropriately advise you. Question:I have signed a Contract - what do I do now?Answer: Should I arrange insurance?
If you are a buyer please note:
The property is at the Buyer's risk from the first Business Day after the Contract Date. The Contract Date is the date the last party (usually the Seller) signs the Contract. You will need to immediately arrange for a cover note/insurance policy for the full replacement value of the property and any improvements on the property - except where the property forms part of a Community Titles Scheme and the Body Corporate has sufficient insurance in place. You need to make sure the cover extends beyond the Settlement Date as defined by the Contract and as extended from time to time.
If you are a seller please note:
We advise you not to cancel your insurance policy until after the matter has settled.
Should I obtain legal advice?
Yes.
If you have not already done so prior to execution of the Contract, you should contact this office:
- to provide a copy of the Contract; or
- to ensure that the Real Estate Agent has provided a copy of the Contract to this office on your behalf.
Subsequently we will discuss any significant issues of concern and may suggest the inclusion of new or additional special conditions or otherwise suggest amendments or deletions to the Contract depending on the nature of the property and your individual requirements.
What is the significance of the deposit?
Most Contracts provide that the Buyer must pay a Deposit either upon execution of the Contract, or within a certain timeframe of execution of the Contract by the Seller. The Seller is entitled to claim what is known as 'Default Interest' on the Deposit in the event that the Buyer fails to pay same in accordance with the Contract calculated from the date payable until the date paid. Alternatively the Seller may attempt to terminate the Contract before the Deposit is paid.
Provided the Buyer validly terminates the Contract, the Buyer is ordinarily entitled to a refund of the Deposit. If you proceed to settlement the Deposit is most often deducted from the Purchase Price.
For important legal reasons, the Deposit should not be any more than 10% of the Purchase Price. Question:How much will it cost me to get legal advice?Answer:The cost of not obtaining legal advice can be significant. Apart from your time, in the event that you attempt your own conveyance and you make an error there can be significant penalties ranging from the termination of the Contract to being sued for loss and damage.
For most Australian states it costs more to engage an agent to effect a sale than for a lawyer to provide you with legal advice and peace of mind.
The professional fees payable usually depend on whether you are purchasing a unit, vacant block of land or house. When providing cost estimates we will also need to know whether you and any other parties are purchasing the property as a home, first home or as an investment.
Once we have considered the Contract, we are able to provide an 'all-up' approximate cost including the anticipated search fees, stamp duty and professional fee. Provided the conveyancing process proceeds reasonably smoothly through to settlement and the settlement is within the average settlement timeframe of 30 days from Contract Date, the actual cost is often no more than our initial approximate cost.
We pride ourselves on ensuring that our clients are kept fully informed of all important aspects of the conveyance, including costs. Should at any stage we consider that you are likely to be liable to pay more than the approximate cost we will discuss costs with you as part of providing the further advice required. Question:I have been presented with a Contract by the Real Estate Agent, however I am unsure about some of the terms and/or special conditions inserted into the Contract. What should I do?
Answer:You should ensure that the agent provides a copy of the Contract to this office. We will review the Contract and may suggest the inclusion of special conditions or otherwise suggest amendments or deletions to the Contract.
We will obtain a copy of the Title Search to confirm that the ownership details and the legal description of the property have been accurately recorded on the Contract. We may also consider it necessary to obtain a copy of any encumbrances, for example, a drainage easement burdening the property.
Depending on your level of experience we will then briefly discuss the conveyancing process including expected timeframes, our requirements of you and the next steps you should be taking. We use our best endeavours to make the conveyancing process as simple as possible, however for privacy reasons, there are certain steps that must be taken by you before we can proceed.
Disclaimer: The above questions and answers refer to the position pursuant of an REIQ standard contract which has not been amended via special condition. All of the advice should be read as generalised, non-specific advice and is a guide only. The advice may not be current due to the fact that the law constantly changes. For answers specific to your circumstances you should contact your lawyer. |
