Please note: this article is slightly outdated due to
changes in Titles Office and State Revenue Office processes
since it was written. The article will be updated
The big contract has been signed, and the settlement date set.
So what happens in between? This guide gives you an idea of what
At Kai Legal, we guide our clients expertly through this whole
process, ensuring a smooth and stress-free settlement.
The major tasks to be done after the contract of sale is signed
Some sale contracts are conditional on one or more of the
Many contracts are also contain cooling-off rights for the
Once all the conditions are satisfied, and the cooling-off
period passes, the contract has ‘gone unconditional’. It becomes
very difficult for a purchaser to withdraw from the sale without
forfeiting the deposit and possibly being liable for other
damages suffered by the vendor from the withdrawal.
At this point, purchasers should, if they have not done so
It is fairly routine for vendors to request an early release of
the security deposit (otherwise known as a section 27 release).
These requests are accompanied by a statement of any monies owed
by the vendor to a mortgagee over the property, to assure the
purchaser that the owner does not owe the mortgagee more than
the sale price of the property.
The purchaser’s solicitor or conveyancer will organise both
parties to sign a draft Transfer of Land form, which will be
lodged at the Land Titles Office on settlement day, instructing
the Registrar to officially record the purchaser as the new
owner of the property.
Parties who are unable to personally sign the transfer (usually
due to being overseas) should prepare a power of attorney ahead
of time to allow someone else to sign on their behalf.
The vendor has an obligation to deliver the property with clear
title on settlement day, subject only to the encumbrances
disclosed prior to sale.
For most vendors, this means organising a discharge of a
mortgage over the property.
It may also involve removing any caveats lodged by third
parties (for example, people to whom the vendor owes money).
The purchaser’s solicitor or conveyancer usually also undertake
further checks on the legal title over the property, to make
sure that there are no encumbrances on the title that were not
disclosed prior to sale. For example, there may be easements
over the property that restrict where buildings can be built.
Anything not disclosed may give the purchaser a right to
withdraw from the contract.
Purchasers generally have a right to nominate substitute or
additional purchaser. They should consider the best person to
purchase the property, for example, whether in their own name,
whether with their parents, partners or children, in a family
trust, as a company, etc. If that is different to the person
signing the sale contract, then the nomination right needs to be
Some rates, charges and income ‘run with the land’, so it is
only fair for the parties to adjust for those fees on settlement
day so that the vendor pays for the outgoings and gets the
benefit of income before settlement, and the purchaser does so
These amounts to be adjusted include:
An adjustment statement is generally prepared by the
purchaser’s solicitor or conveyancer, and forwarded to the
vendor’s side for checking and approval.
The vendor issues instructions on where the balance of purchase
moneys should go. Typically:
The purchaser’s solicitor or conveyancer makes sure that
funding (generally in the form of bank cheques) will be ready to
match these requests on settlement day.
The purchaser is entitled to a final inspection of the property
in the week before settlement, to check that the property is
still in a similar state as on the purchase date, and that the
vendor is able to give over vacant possession of the property.
This is generally done as close to settlement date as possible.
This is also the time for the purchaser to organise its own
connections of utilities, and to arrange for the collection of
the property keys from the vendor’s agent on the day of
On settlement day, the parties’ legal representatives and their
mortgagees meet to exchange title documents and bank cheques,
and generally ensure that the sale can be completed.
The purchaser’s mortgagee or legal representative then lodges
the transfer of land form, to officially register the purchaser
as the new owner. Typically that same person also ensures that
stamp duty for the purchase is also paid.
Most importantly, the purchaser then collects the keys from the
After settlement, the parties’ solicitors and conveyancers send
notices to the local council, the State Revenue Office and other
authorities notifying them of the change in owner, to ensure
that it is the purchaser who is liable for future fees in
respect of the property.
Growing up in a family of property developers, real estate is
in Lucy’s blood. It’s that experience and her time at her
previous commercial and property law practice that allows Lucy
to cut to the chase, identify the real issues, give you
practical advice alongside the legal, and help you with anything
from the smallest purchase to your next major development
Lucy can also draw from her years of experience at the
Australian Tax Office and Victorian State Revenue Office to help
you structure your property transactions in the most
Call us on +61
3 9041 7733 if you would like to find out more.
The Fitzroy Legal Centre’s law handbook is a good
reference for the legal aspects of a purchasing transaction.
There are many helpful resources on the web to help property
buyers. Always check when they were written, as the law and
industry practices change frequently, and many articles are
You can see our related services for property purchases on our
Kai Legal publications provide general information, and are not
legal advice. These are not complete summaries of the law, and
only touch on select points and scenarios that may be relevant
to our readers.
This fact sheet is current as of 18 February 2015.
© Kai Legal 2015
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