How to prepare for settlement?

What is settlement?

Property settlement is a legal process where ownership formally passes from the vendor to you (the purchaser). For an off the plan purchase, the settlement period is triggered by the Land Registration Notice. Settlement period can be found in the Contract of Sale. For Menangle Park, it is 21 days from the date of Land Registration Notice.

 

How to prepare for settlement?

• Valuation – You will receive information from the vendor sales agent when the land is ready for valuation a few weeks before land registration. At this point, you should notify your lender to arrange site access and valuation.
• Finance – Once your land valuation is complete, you will need to organise all the funds required to complete the sale including the balance of the deposit, stamp duty if any, lenders mortgage insurance and other fees.
• Settlement – You will need to contact your solicitor or conveyancer to act as your agent in the settlement process.

 

What happens on settlement day?

Your solicitor or conveyancer will manage the flow of funds and the legal documents to ensure title is passed to you. Provided that there are enough funds in the account, there is no action required from you on the day.

Your lender will:

• register a mortgage against the title of your new land.
• provide the funds to purchase the new land.

Your solicitor or conveyancer checks that:

• any existing mortgage on the title to the vendor is discharged.
• 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 NSW – NSW Land Registry Services (NSW LRS).

 

Duties & Rates

• You are responsible for paying stamp duty within 3 months of the property settlement (if not paid at Contract Exchange). Refer to revenue.nsw.gov.au/ for more information. The title to the property will not be transferred to your name until you have paid this duty.
• Your solicitor or conveyancer can lodge an application for assessment on a contract for sale or transfer of land on your behalf. They’ll also arrange for duty to be paid. They’ll also know if you are entitled to any exemptions or concessions.
• The vendor is responsible for rates and other council fees up to and including the day of settlement, but after this, you will need to pay these costs. Your solicitor or conveyancer should update the public records on your behalf at settlement. Review the settlement statement provided by your solicitor or conveyancer, which outlines the final amount payable for settlement.
• Once your settlement is complete, you can start the process of building your house.