Conveyancing disbursements — what are they, and who is responsible for them when buying or selling a property?

The legal process of buying or selling a property through conveyancing can leave you feeling lost or confused, especially with technical jargon like “conveyancing disbursements”. If you’re in a similar situation, we’re here to help.

In this article, we’ll shed some light on what exactly disbursements are in conveyancing and whether you’ll need to deal with them when purchasing or selling property.

Table of contents

  • What are disbursements in conveyancing?
  • Who is responsible for paying conveyancing disbursements?
  • How are disbursements calculated in conveyancing?
  • How much are disbursement fees in conveyancing?

What are disbursements in conveyancing?

When it comes to using the services of a conveyancer for selling or buying property, there’s the conveyancing fee that most people are aware of, and then there are a handful of other fees that are not as apparent at first glance.

Conveyancing disbursement fees are part of the total cost incurred as part of the process that is paid to third parties of the transaction.

Examples of conveyancing disbursement include:

  • Stamp duty — A tax that is paid to the state government when you buy a property.
  • Title search fee — The cost of service for the Land Registry to search the title of the property to ensure that it is free of any encumbrances or defects.
  • Registration fee — The cost for the Land Registry to register the transfer of ownership of the property from the seller to the buyer.
  • Building inspection fee — The cost for a qualified building inspector to inspect the property for any structural defects or damage.
  • Pest inspection fee — The cost for a qualified pest inspector to inspect the property for any pests or termites.
  • Strata report fee — Applicable only if the property is part of a strata development, this fee is paid to the strata management company to obtain a strata report for the property.
  • Courier fees and other administrative expenses

Your conveyancer will typically collate an estimate for these expenses required for the transaction before starting the conveyancing process to give you a good idea of the total cost of the service. When you receive the final invoice, you’ll be able to find these expenses under “conveyancing disbursements”.

Who is responsible for paying conveyancing disbursements?

Paying additional costs in any transaction is never ideal, but the expenses for the property transaction have to come from someone. In most cases, that party is the buyer of the property.

Since the buyer is responsible for making most of the payments to the other parties (seller, conveyancer), as well as the confirmation of the successful transfer of the property’s title and ownership, they are also charged with the conveyancing disbursements.

However, this is not always the case, and sellers can sometimes be partially responsible for the disbursements when they have agreed to it. For example, some sellers may agree to pay for a pest or building inspection as part of the deal agreement. In such cases, they will be responsible for that particular expense as part of the disbursement fees.

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How are disbursements calculated in conveyancing?

Conveyancing disbursements are calculated by adding up all the associated fees that will be incurred as part of the property transaction process.

Stamp duty, for example, varies depending on the state or territory where the property is located and the property’s purchase price. Similarly, the registration fee is calculated based on the value of the property.

Other disbursements, such as property searches and building and pest inspections, are usually charged on a per-service basis. Your conveyancer will obtain quotes from different providers and then pass these costs on to the client to make the decision.

How much are disbursement fees in conveyancing?

It’s hard to say how much you’ll need to pay in disbursement fees since it can vary depending on the specific circumstances of your property transaction. Disbursements in conveyancing can add up to a significant amount of money (up to a couple hundreds), so it is important to get an accurate estimate of it beforehand by speaking to your conveyancer.

Final thoughts

Disbursements in conveyancing are a necessary part of the process, and hopefully, we’ve provided you with a clearer picture of what to expect when you see them on your invoice. Here’s one last tip from us — be sure to get a full breakdown of all expected disbursements upfront so that you can budget accurately and avoid any unpleasant last-minute shocks.

At Entry Conveyancing, we believe in providing clear and transparent costs, from our conveyancing fees right down to disbursement fees. Whether you’re looking to sell or buy your house, our Sydney & Melbourne conveyancing experts can help smoothen and fast-track the entire process so that you can focus on getting what you’re due.

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