How Does Conveyancing Work When Buying a Home?
Conveyancing is an essential part of buying a house. It begins when you sign the offer on the house, and ends after you exchange contracts.
You’ll want to make sure you know how your solicitor or licensed conveyancer works and what they’re responsible for. This can be a lengthy process so it’s important that you understand the costs involved.
Completion
When a property purchase or sale has completed, ownership is transferred from the seller to the buyer. The keys to the property are then given to the buyer, and the seller must vacate the property by the completion date.
After the documents and transfer deed are signed, the new owner is registered with the land registry. This is the final step before you can move in to your new home.
Your conveyancer should receive funds from the buyer’s lender on the day of completion. This can sometimes take longer than anticipated, especially if there are many transactions.
Exchange of Contracts
The exchange of contracts is the point where a sale becomes legally binding for both parties. A completion date is then agreed which is the day when the buyer pays the seller and ownership of the property is transferred to them.
The contract will usually set out all of the terms and conditions for the property purchase, including details such as the sale price, completion date and how the money for the purchase will be paid. This includes the deposit the buyer will pay. It can vary from 5-10% of total purchase price.
The buyer’s conveyancer will lodge the deposit received from the seller with the solicitor. If you are buying with mortgage, a mortgage advance will also be filed. After all paperwork has been completed and contracts have been exchanged, the legal transaction can be concluded.
Mortgages
There is a lot of legal work involved in buying a property. This is called conveyancing, and it’s one of the most important parts of the process.
A mortgage is required to purchase a property. A mortgage lender will typically request that you have a valuation before they provide funds for the purchase.
The valuation will give the lender a clear picture of how much you’re likely to be able to afford. A house survey is a good idea as well to find any potential problems.
A mortgage is a debt secured by real estate, a legal interest in the property that allows the lender to sell it or re-finance if the borrower defaults on the loan. There are two main types of mortgage: lien theory and equity theory.
Searches
Your solicitor/licensed conveyancer will conduct various property searches on the property you are interested in purchasing during a property conveyancing melbourne transaction. These will uncover issues around the property and its location, which buyers need to be aware of.
They will also check for planning permission which may be in place, access rights and drainage problems etc. The searches are designed to ensure that the property you are purchasing offers sufficient security for a mortgage, or if you are buying it as a cash buyer they will help you to make an informed decision.
You will not be able to close the transaction if searches have not been completed. They can be expensive but they are essential if you are buying a property and will give you a clear idea of what to expect with the purchase.
Disbursements
When it comes to buying or selling your home, you may have to pay fees that are required by third parties. These are called disbursements and should be clearly listed in your quote.
They are fees that your solicitor pays to third parties on your behalf. These fees are separate from the legal work required for your conveyancing transaction.
They can include searches such as environmental, water and hazard reports, and land and title checks. They can also include searches of local authority registers or chancel liability searches.
