Five things to do before settlement
The period between when your property is ‘under contract’ and ‘settlement day’ can feel like a bit of a waiting game.
After all, the property is now sold, but you are waiting for the paperwork to be finalised and
exchange to take effect.
So, what should you be doing? Here are five things to do before settlement.
What is settlement?
Settlement is the period when all the legal and financial details of a property are dealt with. This process starts once the seller and purchaser have signed a contract of sale.
The settlement period usually takes around six weeks, but can be longer or shorter if specified in the contract of sale.
The key moment you are working towards is settlement date, when the property officially changes hands.
On this date, the money for the purchase is transferred from the buyer to the seller (or from the buyer’s lender to the seller’s mortgage account) and the keys to the home are handed over.
What your conveyancer will do
In order for settlement to take place, you should appoint a legal representative or conveyance to handle the paperwork side of things.
They will help guide you through the process of liaising with your lending institution and ensure the terms of your contract are met.
They will also go over the contract to make sure it’s accurate, and check things such as the property boundary to ensure it corresponds with the Certificate of Title.
Meanwhile, you should let your lending institution know the date that settlement will take place.
The actual exchange on settlement day does not require either the buyer or seller to be in attendance. It will happen between the legal parties and lending institutions and you will be notified once everything has taken place.
In the interim, there are a few other things you might need to tend to…
Organise your removal
You will need to vacate the property prior to settlement, unless something else has been negotiated.
That means you will need to organise your removal and ensure all personal effects have been removed from the property.
Cleaning
The property will also need to be in the same condition as when the buyer inspected it, so a final clean will be needed and the garden will need to be tended to.
In addition, don’t forget to speak with your electricity, gas and telephone suppliers to ensure your contract with them for amenities to the property concludes on settlement date. You will also need to forward your mail and alter our billing address.
The final inspection
Prior to the property being handed over, the buyer will likely want to perform one final inspection.
This usually takes place in the few days prior to settlement and ensures everything is as the buyer expects, in accordance with the contract.
During this inspection, they will check that all fixtures and fittings included in the sale remain at the property and there is no structural damage.
Insurance
Property insurance is an important part of the settlement process, and who is responsible for that insurance once a contract is signed can vary from state to state.
For example, in Queensland, the buyer should insure the property the day after it goes under contract, while in many other states, the seller is responsible for property insurance right up until settlement date.
Talk to your insurer early in the sales process to understand exactly how the property needs to be protected throughout the duration of the sale.
Looking to buy or sell?
If you’re considering buying or selling a property, why not chat with one of our friendly Eview agents on 1300 438 439?
You can also view our list of currently available properties here.
