Buying or selling real estate is an exciting prospect. The actual process of transferring ownership in land can be quite daunting for many people. Sometimes a buyer/seller of property has difficulty understanding conveyancing terms their solicitor/conveyancer uses.
The following are some commonly used terms you will encounter when buying or selling property in NSW:-
Vendor: the owner of the property
Purchaser: the buyer of the property
Mortgagee: the Bank providing monies to a person for the purchase of property
Mortgagor: the person borrowing the money from the Bank to purchase the property
Offer: The price the purchaser puts to the vendor (usually through a real estate agent) for the property. Vendor acceptance of the offer does not mean the purchaser has entered into a contract to purchase the land, as this happens on exchange.
Contract for Sale of Land: a document prepared by vendor’s solicitor/conveyancer evidencing the legal agreement between the vendor and the purchaser
Deposit: a sum usually 10% of the purchase price payable to the real estate agent on exchange as a vendor safeguard. The deposit is held by the agent until settlement at which time it is released to the vendor.
Bank Deposit: Your bank may require you to have 20% deposit representing the amount of your savings before it will lend to you.
Exchange: Is when a duplicate copy of the Contract is signed by each of the parties and the documents are “”swapped” so the vendor has a copy of the contract signed by the purchaser and vice versa. Once exchange has occurred, the parties are contractually bound and are unable to pull out of the sale/purchase without suffering serious consequences.
PEXA: stands for “Property Exchange Australia”. It is an electronic settlement system for property transactions including payment of settlement monies, duties, taxes, and any other disbursements and the electronic lodgment of dealings to the Land Registry.
Client Authorisation: a form signed by the vendor/purchaser authorizing their solicitor/conveyancer to act for them in the online workspace of PEXA.
Verification of Identity (VOI): Each vendor/purchaser will need to provide identification documents i.e. passport, driver’s licence, medicare card, birth/marriage certificate to their solicitor/conveyancer for identifying the parties to the transaction.
Completion period: The time between exchange and settlement. The vendor usually stipulates a period between 28 days and 42 days for completion to occur.
Settlement/Completion: the day when ownership of the property is transferred from the vendor to the purchaser. The purchaser supplies the balance of monies to pay for the property (taking into account the deposit already paid) and the vendor provides the documents required for the purchaser to be listed as the registered proprietor of the property. This all takes place on the PEXA platform in most circumstances.
Congratulations: the words you will hear from your dedicated Everingham Solomons solicitor/conveyancer once your sale/purchase has been completed because Helping You is Our Business.
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