Do I need a conveyancer to buy a house?

You’ve just come back from a house inspection and have decided to bid for the property when it’s sold at auction in two weeks time.

What should you do next?

Different processes in different places

If you live in Victoria, the first thing to do is ask the real estate agent for a Section 32. This is also called the Vendor’s Statement, and it’s a legal document provided by the vendor (seller) to the potential purchaser of their property. It’s called a Section 32 because it’s based on the requirements set out in section 32 of the Sale of Land Act 1962 (Vic).

The Section 32 is not the contract of sale. The contract is provided to you if you’re successful in your negotiations for the property.

The legal process of buying and selling property in Australia differs across the states and territories.

If you’re selling a residential property in NSW or Queensland, for example, the property cannot be advertised for sale without preparing a contract of sale.

In South Australia, a Form R3, also known as a Buyer’s information notice, must be made available to any potential buyers inspecting the property.

In whatever state or territory you’re buying a property, always do your research. Buyers and sellers both have legal responsibilities when they’re involved in the sale and transfer of property from one party to another.

It’s best to check what documents need to be prepared and what type of sales process you’re dealing with. To help you, we’ve created the following list of authorities in each state and territory. It should also help you with the question ‘What does a conveyancer do when buying a house?’

What type of professionals are involved when I buy or sell a property?

If you’re purchasing property and require finance then it would be wise to find a good mortgage broker. You can approach lenders, such as banks, directly – but remember the cost of the mortgage broker is paid by the lender, so you can appoint a mortgage broker at no cost to work on your behalf.

Whether you’re buying or selling, you’re going to be dealing with a real estate agent. If you’re a buyer, an important point to remember is that the agent is employed by, and represents, the vendor (seller). The agent is obligated to get the best price possible for the property. In a house auction, for example, there is often an agreement offering the agent a financial incentive for achieving a higher price than the reserve.

Do l need a conveyancer to buy a house?

No you don’t! but its strongly recommended that you obtain the services of a registered conveyancer or a legally qualified person. It’s not recommended that you do your own conveyancing. And you should not allow a friend or relative to do it unless they’re a registered conveyancer who holds at least $2 million in professional indemnity insurance.

The best conveyancer is a conveyancing solicitor because they have a law degree and work in conveyancing and property law. Sometimes legal matters arise during the conveyancing process that a registered conveyancer is not qualified to fix. It’s always best to hire a conveyancing solicitor who can resolve any type of legal issue that might arise.

In a nutshell, a conveyancer can only provide legal advice about the property you’re buying or selling. A conveyancing solicitor, on the other hand, can provide legal advice about the property and any other legal issue that comes up, such as taxation or the need to make a will.

What exactly does a conveyancer do?

Do I need a conveyancer to buy a house and do I need a conveyancer to sell my house? The answer is yes to both these questions. Let’s look at why.

What does a conveyancer do when buying a house? They will:

• guide you through the contract and the process of buying the property
• research and advise on property title, including easements, covenants, outgoings, mortgages, and any declarations (e.g. located in bushfire zone)
• deal with the vendor and real estate agent on your behalf
• coordinate payment at settlement with your lender and client representative
• provide important information on what happens at settlement
• prepare and lodge all documents related to transfer of property
• ensure there are no delays and that settlement will proceed smoothly.

Do I need a conveyancer to sell my house? Yes, you do because they will:

• organise for the buyer’s deposit to be released to you
• work with your lender to discharge your mortgage on the property
• prepare the contract of sale and any other required documents
• manage release of title documents for transfer to the new owner at settlement
• ensure there are no delays and attend settlement on your behalf.

How do you know if your conveyancer is registered?

The easiest way is to find out if your conveyancer is registered, is to bring it up in your first conversation. Also ask them if they’re a member of the Australian Institute of Conveyancers. Enquire about how many years they’ve been working as a conveyancer and what type of property they specialise in. You can also ask about references or recommendations by previous clients.

If you’ve hired a conveyancing solicitor, their law degree is evidence that they’re well-qualified to manage your conveyancing and any other legal matters that might arise.

Check in your own state or territory whether there’s a public register of licensed conveyancers. In Victoria, Consumer Affairs maintains a list of licensed conveyancers here.

Are a conveyancer and a conveyancing solicitor equally covered by insurance?

This is a complex question, but look at it like this. All solicitors, no matter what area of the law they practise in, are required to have professional indemnity insurance.

Professional indemnity insurance protects the solicitor, and the company they work for, from any errors they make while giving professional advice or providing a service. If the advice they give results in damage, injury or financial loss to the client, and they take legal action, then the solicitor has insurance in place to protect the client, themselves and the company.

The non-solicitor conveyancer is qualified to provide a conveyancing service. They can give advice about conveyancing, but must not offer advice or provide services for anything outside the scope of conveyancing. In Victoria, legal work a conveyancer is not permitted to carry out is listed in section 4 of the Conveyancers Act 2006 (Vic).

For example, if a non-solicitor conveyancer is involved in creating, varying or extinguishing a trust; giving the client investment or financial advice; or applying for a grant of probate or letters of administration, they are not covered by their professional indemnity insurance – and neither is their client.

Non-solicitor conveyancers generally take great care to stay within the scope of conveyancing work as defined by legislation.

Can conveyancing be done online?

Digital property settlement, or e-conveyancing, has become increasingly popular over the last decade and even more so since the COVID pandemic.

In Australia, a company called PEXA has become the world’s first digital platform for property settlement. Founded by the Council of Australian Governments (COAG) in 2010, PEXA was later sold and its major shareholders are now Link, Commonwealth Bank and Morgan Stanley Infrastructure Partners.

Learn more about PEXA

Many conveyancers and conveyancing solicitors use PEXA for property settlement. It’s a contactless and convenient way to transfer ownership of a property. Conveyancers can lodge documents with the land registry and pay settlement funds simultaneously – and it all happens without attending a settlement meeting.

For buyers and sellers, PEXA has a free app, called PEXA Key, that enables you to track your property settlement. It uses encrypted data for bank details and sophisticated verification processes. It also contains property settlement checklists for easy task-checking.

Traditional face-to-face settlements still occur and it’s best to ask your conveyancer, or conveyancing solicitor, to confirm what settlement method they’re using for your property settlement.

You might be asking the question ‘Do I need a conveyancer?’ if you’re using PEXA, and the answer is yes, you do. The conveyancer will manage PEXA, and you can be involved to the extent that you wish.

An important detail to remember about your conveyancer

No matter whether you purchase your property at auction or by private sale, the type of loan you secure or the length of the settlement period – your conveyancer is highly unlikely to ever set foot in the property. That’s right. Think about it. They’re helping you purchase a property they’ve never seen.

What this means is that you must be diligent in your observations. Pass on any useful or concerning information about the property when you inspect it. Take care to measure the boundaries and ensure they correspond to those on the title. Organise a building inspection and follow through with every request for information the conveyancer asks you for.

Buying or sell a property is a life decision and mistakes and delays in settlement can be costly. You want to do everything possible to ensure it’s a good day!

Do you need a conveyancer? You do! At Entry Conveyancing, Luke Primon is a conveyancing solicitor who can help with every legal aspect of buying or selling property. Contact Luke today for a free confidential chat about your conveyancing needs.