At settlement, the vendor delivers a transfer of the land to the purchaser so that the purchaser becomes the registered proprietor of the land. A vendor must also clear all the encumbrances, such as mortgages, that will not be passed on to the purchaser. The purchaser must pay the vendor the outstanding balance of the purchase price and the vendor must deliver possession of the property to the purchaser.
The vendor generally decides where and at what time settlement will take place as the vendor controls the title. The vendor and purchaser will usually be represented by their solicitors or conveyancers at settlement. However, if they do not have either they can attend themselves.
On the actual day of settlement, each party must arrange for the relevant people to attend settlement. If a third party has a mortgage or charge over the vendor’s property they will have to be present to discharge this interest. Furthermore, if the purchaser intends to use the property as security for finance, their financier will also need to be present.
At settlement the purchaser will receive the following from the vendor:
- The duplicate Certificate of Title;
- A transfer signed by the vendor and the purchaser;
- The vendor’s statutory declaration as to the value of the land;
- Discharge of any mortgage registered on title;
- Withdrawal of any caveat on the title;
- Directions as to payment of the balance of purchase price; and
- A statutory declaration as to the value of the purchase (for stamp duty purposes).
The purchaser will hand over to the vendor:
- The settlement amount, as per the vendor’s direction; and
- Orders to the agent to authorise the release of the deposit.
The purchaser will then hand to their lender (if any):