Conveyancing terms explained
Do you know your adjustments and your zoning? Or what the difference is between tenants in common and joint tenants?
If not, then read on!
Read our A to Z of some terms commonly used in the conveyancing process.
A
Adjustments: In layman’s terms, this is the calculation of who owes what for rates and levies as at the day of settlement. This process helps ensure that both parties are only responsible for paying the outgoings for the time period relating to when they are in possession of the property.
Agent: That’s us! We act on behalf of sellers to arrange the sale of property including houses, land and commercial property, such as shops. There are also agents who specialise in farms and businesses.
B
Boundary: This defines the boundaries of the property as at the date it was prepared.
C
Certificate of title: This is the proof of ownership, and may also include historical information about encumbrances on the property, for example, easements.
Common property: In strata titled properties there are shared use and access by all owners (e.g. hallways, green spaces and driveways in unit blocks), and this needs to be noted.
Conveyancer: This is the name given to the professional who is managing the conveyancing process.
Conveyancing: The legal process through which a title for a property is transferred from one party to another.
Cooling-off period: There are circumstances whereby you may need to say ‘Thanks, but no thanks. I want to cancel my transaction’, and the cooling off period allows for this. If you take the option to cancel your legal agreement, you may have to pay the seller a termination fee, but in some circumstances, it can be worth paying the price. In New South Wales, there is a five day cooling-off period for residential property (unless it is waived through negotiation between the parties). Some sale types, such as an auction, does not allow either party to have this period of time to change their mind.
Contract of sale: This is a legally binding agreement between the buyer and the seller for the sale of the property. It sets out the specific terms from which the seller will sell the property to the buyer. As this is a legal document, we recommend for both parties to seek professional advice from their legal representatives.
D
Disbursements: These are the additional costs that are incurred as part the conveyancing process. They often include the title search, certificate fees, registering the title transfer, registering the mortgage or even something as simple as photocopying and postage. Non-legal fees may include survey reports, building inspections, valuation fees and could include any outstand utility costs.
Deposit: The buyer must put down a certain amount of money in order to secure the property purchase. This is usually 10% of the overall purchaser price. However, this amount can vary as long as the seller agrees to the sum.
Disbursements: The two main types of expenses that must be paid to a solicitor or a conveyancer, including professional fees and disbursements. Disbursements could include settlement or search fees, which the conveyancer must pay on the client’s behalf.
E
Easement: An easement is a covenant that burdens or benefits a parcel land. Easements can affect what you can or cannot do with the land. An example of an easement is a right of way over someone else’s land.
Exchange of contracts: As the name suggests, this involves swapping your signed version of the contract with the seller’s signed identical version and indicates the commencement of the agreement to buy/sell the property (which ends at completion or settlement of the agreement).
F
Fittings: Items can be removed without damaging the property. In the kitchen, for example, this will include fridges, freezers and microwaves.
Fixtures: Items which are attached to the property and cannot be removed without causing damage. Again, in the kitchen for example, ovens and range tops, sinks, cupboards and work tops.
J
Joint tenants: Joint tenants means that each tenant (for example a husband and wife) own the whole of the property together or jointly. It involves a right of survivorship, ie if one of the tenants dies, the property automatically passes to the surviving joint tenant; in the example of the husband and wife, the surviving spouse then owns the whole of the property on their own.
O
Owners corporation: The owners corporation is the body made up of all the owners in the strata scheme.
R
Requisitions and Enquiries: Understandably, the purchaser will have questions in relation to the property, and they may include information on how matters are to be dealt with on completion. For example, adjustments to be made, documents to be handed over, or the existence of any statutory notices.
Requisitions on title: A set of questions about a property the buyer asks the seller after the contract has been signed.
S
Settlement: Settlement occurs near the end of the conveyancing process. This is when the remaining balance of the purchase price is paid to the seller and the documents required to legally transfer of ownership are registered or sent for registration.
Stamp duty: Transfer of land, business or stamp duty is a State-based tax that is paid on certain land or business transactions in applicable States in Australia. Find out more about stamp duty in NSW and how to calculate it here.
Strata title: Each unit in a block or multi-unit complex is individually owned by the resident.
T
Tenants in common: A form of joint ownership of a property when each person owns a share of the property, equally or unequally. It is different to joint tenants as each tenant owns are particular portion of the property (eg. 40%, 50%, 60% etc) and may be able to transfer their portion only or give to a particular person through their Will. The right of survivorship does not apply to tenants in common as it does for joint tenants.
Torrens title: A system of title by registration adopted by each state/territory in Australia.
Transfer: A legal document showing the property’s title particulars for the property that is going to be transferred between two parties.
V
Valuation: An estimate of the value of a property by a registered valuer.
Vendor: The person selling the property. (Sometimes referred to as a Seller.)
Z
Zoning: The permissible uses of an area of land as stipulated by the Local Council
Always used a licensed conveyancer for your house sale – if you don’t know of one, and haven’t had a personal recommendation use the https://www.findaconveyancer.com.au/ – A free service provided by the Australian Institute of Conveyancers NSW Division so that consumers can find a conveyancing business in the locality that most suits their needs. All businesses listed on this site are members of the Australian Institute of Conveyancers NSW Division (AICNSW).
Our aim to make your sale as smooth as possible, and we’re constantly getting great results for our people who choose us to sell their property.
If you have any queries about selling your property, or would like a free, no obligation quote, give us a call on 02 4954 8833. Or send us an email to: mail@apnewcastle.com.au – we’d love to hear from you.
And don’t forget to check out our Facebook page for handy tips on selling your property or what to look for when buying a property.