What Happens on Settlement Day in Victoria?

Property settlement is the final stage of a property transaction. It is when the balance of the purchase price is paid, ownership of the property is transferred from the vendor to the purchaser and the sale is formally completed.

In Victoria most property settlements are completed electronically. Your conveyancer, the other party’s representative and the incoming and outgoing lenders work together in a secure electronic workspace to complete the necessary legal and financial steps.

What Happens Before Settlement?

Before settlement, I will liaise with you and the other parties involved to ensure the transaction is ready to proceed.

This generally includes:

• confirming the amount required to complete settlement;

• preparing and checking the settlement adjustments;

• arranging for the transfer documents and other required documents to be completed;

• coordinating with your lender, if applicable;

• confirming how settlement funds are to be paid or received; and

• checking that any special conditions or outstanding requirements have been addressed.

Rates, water charges, owners corporation fees and other applicable outgoings are usually adjusted between the vendor and purchaser at settlement. This ensures that each party is responsible for their proportion of the relevant charges.

The Final Inspection

A purchaser will usually arrange a final inspection of the property shortly before settlement.

The purpose of the final inspection is to confirm that the property is in the same condition as when it was sold allowing for fair wear and tear and that any agreed inclusions remain at the property.

If an issue is identified during the final inspection you should contact your conveyancer promptly. Depending on the circumstances, the issue may need to be raised with the vendor’s representative before settlement.

What Happens During Settlement?

At the scheduled settlement time the parties’ representatives and financial institutions complete the transaction electronically.

The settlement funds are distributed, any existing mortgage is dealt with and the transfer of ownership is lodged for registration. Any agreed adjustments, loan repayments, professional fees and other authorised payments are also accounted for as part of the settlement process.

You do not need to attend settlement personally. I will monitor the electronic workspace and notify you once settlement has been successfully completed.

When Can the Purchaser Collect the Keys?

Keys are generally released after settlement has been completed and the selling agent has received authority from the vendor’s representative.

There can sometimes be a short delay between electronic settlement completing and the agent receiving confirmation. Purchasers should therefore avoid arranging removalists or deliveries for the exact settlement time.

What Happens After Settlement?

For a purchaser the property is transferred into their name and their lender will hold control of the electronic title if the purchase is financed. I will also notify the relevant authorities of the change in ownership where required.

For a vendor the sale proceeds are distributed in accordance with their instructions after deductions such as the mortgage payout, rates adjustments, professional fees and any other authorised payments.

What If Settlement Is Delayed?

Although most settlements proceed as scheduled delays can occur. Common causes include a lender not being ready, insufficient funds, incomplete documents or an issue that must be resolved before settlement can proceed.

If settlement is delayed the contract may allow the party who is ready to charge penalty interest or recover certain costs from the party responsible for the delay. The available options will depend on the contract and the circumstances.

How I Can Assist

I will guide you through the settlement process, explain what is required and coordinate with the other parties to help ensure your transaction proceeds as smoothly as possible.

If you are buying or selling property in Victoria, please contact me to discuss how I can assist.

This information is general in nature and does not constitute legal or financial advice. Requirements may change, and advice should be obtained for your individual circumstances.