Buying residential property8 December 2021 in Property and Conveyancing Law
Do I need a lawyer when buying a residential property?
You should consider seeking the assistance of a property and conveyancing lawyer when you are looking to purchase a residential property. A lawyer will review contracts, negotiate with the vendor or purchaser, assist you in property disputes and provide advice regarding issues in other related areas of law. The purchase or sale of a property is a high value transaction that involves risk. It is important that a vendor or purchaser obtains legal advice.
Brander Smith McKnight uses lawyers for all property and conveyancing transactions, we do not use conveyancers.
Purchasing or selling a residential property can be stressful and confusing, a conveyancing lawyer’s professionalism and expertise can assist in alleviating this stress and confusion.
The Process of Buying a Residential Property
A property and conveyancing lawyer will provide you with assistance and advice through the major stages of buying a residential property. The process of conveyancing from exchange of contract to settlement (completion of the sale) typically takes 6 weeks to complete, however, this length can be shortened or extended. The process of buying a residential property has four main stages.
Preparing for Purchase
Firstly, you should have the contract for sale of the property reviewed by a property and conveyancing lawyer. A lawyer will ensure that you understand all of the rights and obligations that arise under the contract. In addition, a lawyer will advise if there are any problematic terms in the contract and negotiate amendments according to your instructions. This helps mitigate the potential for future disputes between the parties to the contract.
Secondly, if you require a loan to purchase a residential property you should seek to have the loan pre-approved and ensure that you have allowed for associated costs such as stamp duty.
Thirdly, you should consider having the property inspected for structural defects or pests for a house and and have a strata report for an apartment. The experienced lawyers at Brander Smith McKnight will organise building and pest inspections and strata reports.
Exchange of contracts
During the exchange of contracts, both parties will come to an agreement regarding the terms of the contract and the purchase of the residential property. Once the relevant contracts are signed by both parties, they will be bound by their terms. Following the exchange of contracts, the deposit on the property will become payable. After the contracts are exchanged and signed, there will typically (unless formally waived) be a cooling off period. This is usually 5 business days, unless otherwise provided by the contract, during which the purchaser has the right to withdraw from the contract. If you have purchased a residential property at auction, there will be no cooling off period and the contracts are exchanged and binding at the fall of the hammer.
Preparing for settlement
Prior to settlement a property and conveyancing lawyer will make various inquiries in relation to the residential property. For example, determining whether the property is heritage listed, council zoning or building approvals or whether there is existing money owing on the land. A lawyer will ensure that approvals, funding and mortgage documentation is in order and prepared for settlement.
The purchaser must pay the stamp duty on the property, which must be paid within three (3) months of settlement. However where a mortgage is involved the mortgagee (bank) will require stamp duty to be paid on or prior to settlement.
Prior to settlement you may also wish to make a final inspection of the property being purchased in order to ascertain whether the property is damaged.
Settlement is the final step in the conveyancing process. Upon settlement you will become the owner of the residential property you have purchased. It is now common for settlements to be completed electronically. A property and conveyancing lawyer can assist you in negotiating a simultaneous settlement. A ‘simultaneous settlement’ refers to situations where the sale and purchase of properties occur at the same time. A conveyancing lawyer will then lodge the relevant documentation for the transfer of property in the NSW Land Registry Services.
Brander Smith McKnight’s expert property and conveyancing lawyers can provide you with advice and assistance throughout the entire process of purchasing a residential property. We will ensure settlement is completed smoothly which includes ensuring the mortgagee is prepared, both the purchaser and vendor have completed all necessary steps and that all relevant documents for the transfer and payment of stamp duty are lodged.
What can I do if the contract has been breached?
Brander Smith McKnight’s expert property and conveyancing lawyers can help you where a party has breached a contract for the sale of property prior to or after settlement. We will advise you of your rights and in consultation with you develop a strategy for the resolution of the breach. This can include negotiation, alternate dispute resolution or litigation.
We resolve the vast majority of disputes without litigation saving our clients considerable amounts in legal fees. If litigation is necessary our lawyers are highly experienced court advocates with a panel of expert barristers available if required. We can either seek compensation for the breach or seek to have the contract performed.
Why BSM Lawyers?
- We have highly experienced property and conveyancing lawyers and appreciate how important the purchase of your property is.
- We will alleviate your stress by ensuring that the process is properly managed and runs smoothly ensuring that all of the detailed documentation is completed thoroughly and on time.
- We will keep you well informed and explain things in clear and simple terms.
- We provide a competitively priced fixed fee.
- All of the work is performed by lawyers, we do not use conveyancers.
- Our lawyers have experience in all types of title, including torrens, strata and company.
Call us to arrange a free 20 minute no obligation consultation that includes case evaluation and cost estimate.
Why is it important to have my contract reviewed by a lawyer when buying a residential property?
A lawyer can ensure that you understand all of the rights and obligations that arise under the contract and advise you if there are any problematic terms to your contract. BSM lawyers can then negotiate amendments to your contract according to your instructions. This mitigates the potential for future disputes between the parties to the contract.
Do I need a lawyers help when buying a residential property?
You can do your own conveyancing, but it is not wise to do so. The purchase of a property is an expensive transaction that involves considerable risk. There are many factors that need precise coordination, for instance approval of funding, loan and guarantor documentation, transfer documents, identification documents, stamp duty documents and registration of title. The process of conveyancing is complex, time consuming and can be very stressful and cause considerable financial loss if performed incorrectly.
What costs arise in relation to the buying of a residential property?
- Stamp duty
- Title search fees
- Lawyer fees
- Fees associated with mortgage and loan documents
- Registration fees
- Removalists fees
- Property inspections
Can I buy a residential property that is not built yet?
Yes, this is known as buying ‘off-the-plan’ property, ‘off-the-plan’ property refers to property that does not exist yet.
What is a cooling off period?
In NSW, a cooling off period is a period of time that commences after the making of a contract for the sale of certain kinds of property. During the cooling off period the purchaser can decide to rescind their contract for the purchase of a property.
The length of a cooling off period is set under law by default but a shorter or longer cooling off period can be negotiated in your contract for the sale of property.
What is the Transfer?
The Transfer is a legal document that swaps the ownership of property from one party to another. A property and conveyancing lawyer can prepare this document for you.
If I am looking to purchase a residential property at auction, should I have a lawyer review the contract of sale prior to the auction?
You should consider having a lawyer review a contract of sale for a residential property before bidding at an auction. This is because there is no cooling off period for properties purchased at auction and you will be bound to the terms of the contract immediately. By having a conveyancing lawyer review a contract prior to bidding at an auction you will be afforded valuable knowledge as to your potential rights and obligations under the contract. In addition, a property and conveyancing lawyer can negotiate the terms of the contract on your behalf prior to the auction.
What are special conditions in a contract of sale?
Special conditions in a contract of sale refers to terms agreed between the parties to the contract that must be satisfied or waived before the contract can be settled.
What is a Certificate of Title?
A Certificate of Title is a document that provides evidence of an interest in property.
A Certificate of Title provides various details regarding property, including who owns the property, the boundaries of the property and any mortgage on the property.
Why should I use a lawyer and not a conveyancer when buying a residential property?
Property lawyers and conveyancers are not the same. You should use a property lawyer to assist you when buying a residential property.
A property lawyer is a lawyer who can provide you not only with assistance in relation to conveyancing, but also with other legal issues you may have. This is because property lawyers also typically practice in other areas of law. For example, our property lawyers can also provide you with commercial and contract law advice and assistance. In addition, property and conveyancing lawyers can identify other legal issues outside of the area of property law as they arise in your matter and provide you with advice and assistance accordingly. Therefore, knowing that a property lawyer can assist you with handling complex legal issues can give you a level of confidence that cannot be provided by a conveyancer alone.
A conveyancer is only permitted to practice and assist people with conveyancing. As such, conveyancers only specialise in the sale, purchase, transfer and leasing of property. Thus, conveyancers are limited in their ability to provide clients with advice in relation to legal issues outside of conveyancing. At Brander Smith McKnight we do not use conveyancers.
Why should I obtain inspection reports if I am buying a residential property?
Whilst it is not compulsory to have a prospective property inspected before you purchase it, it may be advisable to do so. This is because if the property has pests or building defects you will not be protected following the transfer of the property. Obtaining inspection reports regarding a residential property you intend to purchase can assist you in avoiding these problems. A property and conveyancing lawyer can assist you in organising these inspections of a residential property you intend to purchase.