The most exciting part of any property purchase is the Settlement Day (also known as Completion Day under the contract). This is the day that Purchaser finally gets the keys to their new property and Vendors are paid the amount that is owing on the purchase. There is a lot more involved in the land settlement process than meets the eye and to get one step closer to this all-important day we need to chat figures!
Settlement Statements are a useful tool to determine the Balance Purchase Price and capture the amounts required to be adjusted in accordance with the contract.
What is a Settlement Statement?
Approximately two weeks prior to the Settlement Day draft settlement figures are prepared in the form of a Settlement Statement. This Settlement Statement includes the adjustment of Council Rates, Water Rates, Strata Levies (if the purchase property is within a Strata scheme), Land Tax (if the terms of the contract provide for this) and any other adjustments provided for under the terms of the contract. These draft figures are then submitted to the Vendor’s Representative for approval. Once approved, this then becomes the agreed Balance Purchase Price figure (Purchase Price – deposit paid + adjustments).
The Balance Purchase Price, together with all other amounts payable at settlement; namely Transfer Duty (if applicable), PEXA fee, Land Registry Services Registration fees and our Professional fees will be provided to the Purchaser.
If the Purchaser has an incoming mortgagee generally by this stage the Lender will have uploaded the Source Funds (loan amount – fees and charges incurred from the Lender) in readiness of settlement. Should a shortfall of funds, also known as Funds to Complete, be required this amount will then be confirmed with the Purchaser to either be drawn, by the Lender directly, from a chosen linked account or deposited into the PEXA Source account.
The Funds to Complete will ensure the PEXA workspace will balance and now we have figures agreed! It’s time to head to the most important day of all….Settlement Day!!
Contact us today for your thinking of buying your dream home, you will be in safe hands with In The Hill Conveyancing!
