Lyons & Lyons Solicitors

Buying and  Selling Your Home - Conveyance

If you are selling a home you need to think like a Purchaser.

All sorts of anxieties are going through the potential purchases minds

#  Is the building sound-attach a builders report.

#    are the extensions approved by the Local Counsel-attach a certificate from the Counsel,

#    With units attach a strata Inspection report.

#    Provide a update Strata Report.

You want a worry free contract for the sale,so that potential purchasers dig deep into their pockets,knowing that there are no hidden traps.

SAMPLE LETTER WHEN SELLING

RE:     YOUR SALE TO PLUTO

PROPERTY:  23 THE PEARLY GATES, SATURN

Our aim is to provide RollsRoyce service and to keep you informed,and to take the worry and hassle our of this process which is always stressful.

Thank  you for instructing Lyons & Lyons to assist you with your sale of the above property. 

We  confirm that settlement is scheduled to take place on 21^st of June 2010 in accordance with the terms of the contract.

In the mean time, we have summarised the following to assist you in understanding what happens between now and settlement.

Deposit

 The deposit is held by your selling agent pending completion of the contract.

 After settlement, the agent will deduct their commission and outstanding advertising expenses (if any) from the deposit and transfer the balance into your nominated account. If you have not done so already, you should provide the agent with your bank account details in readiness for settlement. Alternatively, the agent will send you a cheque after settlement.

 The deposit can also be invested during the completion period. If you would like the deposit to be invested please contact the agent and instruct them to do so, and also provide the agent with your tax file number to avoid the interest being taxed at the highest marginal rate.

 Discharging your mortgage

As there is a mortgage on your property, the bank will be holding the certificate of title which is to be handed to the purchasers’ solicitor at settlement. 

In order for the bank to release the certificate of title at settlement they will require the loan to be paid in full from the proceeds of your sale or for alternative security to be provided.

We suggest that you liaise with your account manager at CBA to ensure that the Bank is aware of the settlement date. They will ask you to sign a Discharge Authority which will trigger the preparation of a discharge of mortgage and calculation of a payout figure.

It is very important that you do this at least three weeks prior to settlement. We suggest that you go to your nearest branch as soon as possible to complete the relevant form and submit the request.

On the Discharge Authority form you will be able to select an option for the bank to take the full sale proceeds at settlement and for them to deposit surplus funds into your account after deducting their payout figure. We recommend that you select this option if you were planning on putting surplus funds into a CBA account.

 Transfer

The transfer is the instrument that will be registered at the Department of Lands directly after settlement to record the change in ownership. The transfer will be prepared by the purchasers’ solicitor and sent to us approximately two weeks before settlement for it to be signed by you.

 Settlement can not be effected without the signed transfer as it is a crucial part of the transaction.

 If you plan on being away during that time please let us know so that we can make alternative arrangements for you to sign the transfer before you leave.

 Pre-Settlement

 Solicitors will liaise with each other and the banks to arrange a time and place for settlement on the appointed day.

 Council rates, water rates and registration fees will be adjusted (see pre-settlement adjustments below) and we will provide the purchasers’ solicitor with a list of cheques required at settlement totalling the balance of the purchase price, (a ‘direction to pay’).

Your sale proceeds will be used firstly to pay out your loan from the Bank and secondly to pay any outstanding rates, levies and our costs. The balance will be paid into your nominated Bank account. 

We will provide you with a copy of the settlement figures, our invoice and the final direction to pay at least two days prior to settlement for your approval.

Pre settlement adjustments

Approximately one week before settlement we will prepare settlement figures which will set out the adjustment of council rates, water rates and registration fees etc.

The term ‘adjustment’ in this case simply means that at settlement, the purchasers will be required to pay their portion of the rates in addition to the balance of the purchase price. They will be calculated on a pro rata basis from the date of settlement to the end of the rating periods.

All rates will be paid up to the end of their respective periods. If there are any rates outstanding at the time of settlement, we will pay them from the sale proceeds. Please do not pay any rates in the week leading up to settlement.

Purchasers’ final inspection

The purchaser is entitled to carry out a final inspection before settlement which would normally be arranged through the agent. A final inspection is usually scheduled for the day prior to settlement or the morning of the settlement.

 The purpose of this inspection is to ensure that the property has not sustained any damage during the completion period (other than fair wear and tear), and that the condition of the property is the same as when he/she last inspected it (before exchange).

 If any damage has occurred the purchaser will be entitled to make a claim under the contract for recovery of the cost to rectify the damage.

 What is Settlement?

 Settlement is when the purchasers pay the balance of the purchase price in exchange for the title deed to the property. The following parties will be in attendance:

· Lyons & Lyons Solicitors

·     Your Bank as discharging mortgagee

· The purchaser's solicitor

· The purchaser’s incoming mortgagee (if applicable)

 Settlement will take place at an agreed venue somewhere in the Sydney CBD. Various documents will be exchanged between the parties; cheques will be handed over in exchange for the tile deed and assuming all the documents are satisfactory to the purchaser, settlement will be effected.   You are not required to attend settlement.

Vacant possession

 As you are selling the property with "vacant possession" (as apposed to an investment property subject to a tenancy) "vacant possession" technically means that at the time of settlement, the property must be vacant.

 For example:   If settlement has been scheduled to take place at 2.00pm, you must ensure that the property is vacant by 2.00pm, by which time the agent will be notified either by fax or telephone that settlement has been effected and they will be authorised to release the keys to the purchaser.

Keys

After settlement, the purchasers will expect to be able to collect the keys from the Estate Agent.Please therefore ensure that the keys are made available for collection on the day of settlement and they have a set of keys before settlement to do the final inspection.

Post settlement

The purchasers’ solicitor or mortgagee will lodge the relevant documents with the Department of Lands to transfer the property into his/her name.

The Department of Lands will notify the Local Council and Sydney Water of the change in ownership a few weeks after settlement.

Original documents

Please supply the following original documents for us to hand over at settlement:

• Survey Report of Survey Check Surveyors dated 14/04/2010
• Complying Development Certificate
• Occupation Certificate

Legal fees

 We enclose our Cost Agreement for your approval, together with a copy for you to keep. If you are happy with the terms, please sign it where indicated and return it in self addressed envelope provided.

 We trust that the above information assist you understanding some of he fundamental procedures relating to tour sale . Each sale has its own problems and variations,and should you require any additional information, please do not hesitate to contact us.

 LYONS & LYONS

 

SAMPLE LETTER WHEN SELLING

RE:     YOUR SALE TO PLUTO

PROPERTY:  23 THE PEARLY GATES, SATURN

Our aim is to provide RollsRoyce service and to keep you informed,and to take the worry and hassle our of this process which is always stressful.


 Thank you for instructing Lyons & Lyons to assist you with your sale of the above property.

 We confirm that settlement is scheduled to take place on 8^th of July 2010 in accordance with the terms of the contract.

 In the mean time, we have summarised the following to assist you in understanding what happens between now and settlement.

Deposit

 The deposit is held by your selling agent pending completion of the contract.

 After settlement, Di Jones will deduct their commission and outstanding advertising expenses (if any) from the deposit and transfer the balance into your nominated account. If you have not done so already, you should give Lorraine your bank account details in readiness for settlement. Alternatively, they will send you a cheque after settlement.

 The deposit can also be invested during the completion period. If Lorraine has not already asked you to provide a tax file number and you would like the deposit to be invested, please contact her and give her your tax file number to avoid the interest being taxed at the highest marginal rate.

 Discharging your mortgage

As there is a mortgage on your property, the bank will be holding the certificate of title which is to be handed to the purchaser’s solicitor at settlement.

In order for the bank to release the certificate of title at settlement they will require the loan to be paid in full from the proceeds of your sale or for alternative security to be provided.

 We suggest that you liaise with your account manager at ING to ensure that the Bank is aware of the settlement date. They will ask you to sign a Discharge Authority which will trigger the preparation of a discharge of mortgage and calculation of a payout figure.

 It is very important that you do this at least three weeks prior to settlement in order to allow the bank enough time to proceed to settlement on the due date.

 Transfer

 The transfer is the instrument that will be registered at the Department of Lands directly after settlement to record the change in ownership. The transfer will be prepared by the purchaser’s solicitor and sent to us approximately two weeks before settlement for it to be signed by you.

 Settlement can not be effected without the signed transfer as it is a crucial part of the transaction.

 If you plan on being away during that time please let us know so that we can make alternative arrangements for you to sign the transfer before you leave.

 Pre-Settlement

 Solicitors will liaise with each other and the banks to arrange a time and place for settlement on the appointed day.

 Council rates, water rates and registration fees will be adjusted (see pre-settlement adjustments below) and we will provide the purchaser’s solicitor with a list of cheques required at settlement totalling the balance of the purchase price, (a ‘direction to pay’).

 Your sale proceeds will be used firstly to pay out the ING loan and secondly to pay any outstanding rates and our costs. The balance will be paid into your nominated account. 

 We will provide you with a copy of the settlement figures, our invoice and the final direction to pay at least two days prior to settlement for your approval. Please send us details of the account that you want the surplus funds to be deposited into.

 Pre settlement adjustments

Approximately one week before settlement we will prepare settlement figures which will set out the adjustment of council rates, water rates and registration fees etc.

 The term ‘adjustment’ in this case simply means that at settlement, the purchaser will be required to pay her portion of the rates in addition to the balance of the purchase price. They will be calculated on a pro rata basis from the date of settlement to the end of the rating periods.

 All rates will be paid up to the end of their respective periods. If there are any rates outstanding at the time of settlement, we will pay them from the sale proceeds. Please do not pay any rates in the week leading up to settlement. 

Purchaser’s final inspection


The purchaser is entitled to carry out a final inspection before settlement which would normally be arranged through the agent. A final inspection is usually scheduled for the day prior to settlement or the morning of the settlement. 

The purpose of this inspection is to ensure that the property has not sustained any damage during the completion period (other than fair wear and tear), and that the condition of the property is the same as when she last inspected it (before exchange).

 If any damage has occurred she will be entitled to make a claim under the contract for recovery of the cost to rectify the damage.

 What is Settlement?

 Settlement is when the purchaser pays the balance of the purchase price in exchange for the title deed to the property. The following parties will be in attendance: 

· Lyons & Lyons Solicitors

· ING as your discharging mortgagee

· The purchaser's solicitor

· The purchaser’s incoming mortgagee (if applicable)

 Settlement will take place at an agreed venue somewhere in the Sydney CBD. Various documents will be exchanged between the parties; cheques will be handed over in exchange for the tile deed and assuming all the documents are satisfactory to the purchaser, settlement will be effected.   You are not required to attend settlement.

Vacant possession


 As you are selling the property with "vacant possession" (as apposed to an investment property subject to a tenancy) "vacant possession" technically means that at the time of settlement, the property must be vacant.

For example:   If settlement has been scheduled to take place at 2.00pm, you must ensure that the property is vacant by 2.00pm, by which time the agent will be notified either by fax or telephone that settlement has been effected and they will be authorised to release the keys to the purchaser.


Vacant means free of anything that is not included in the sale (see inclusions on the front page), for example: paint tins, rubbish, building materials etc. Anything that is fixed to the property should stay unless it is noted as an exclusion.


Keys


After settlement, the purchaser will expect to be able to collect the keys from Di Jones Real Estate. Please therefore ensure that the keys are made available for collection on the day of settlement and that Loraine Crawford also has a set of keys before settlement to do the final inspection.


 Post settlement

 The purchaser’s solicitor or mortgagee will lodge the relevant documents with the Department of Lands to transfer the property into her name.

 The Department of Lands will notify Sydney Council and Sydney Water of the change in ownership a few weeks after settlement.

Old System documents

We have ordered an old system search which will enable us to prepare an Abstract of Title (chronological list of events leading to your purchase of the property).

We will need to gather as many of the original documents that we can find, and if any of the documents in the chain are missing we will have to obtain “certificated copies” from the Department of Lands.

 It is difficult to predict how much this will cost because it depends on how many of the original documents you manage to find. The search will cost about $500.00 and each certified copy will cost $95.00.

 We will send you a copy of the Abstract of Title when it is ready, together with copies of the documents that you should be looking for. Once you have exhausted the search for the originals we will order certified copies of the missing documents (if any).

Legal fees

 We enclose our Cost Agreement for your approval, together with a copy for you to keep. If you are happy with the terms, please sign it where indicated and return it in self addressed envelope provided.

 We trust that the above information satisfies any queries you may have, however should you require any additional information, please do not hesitate to contact us.

 Yours faithfully,

LYONS & LYONS

Direct tel: 8383 3115

Direct fax:  9389 5192

Email: jwlyons@lyonsandlyons.com.au

Supervising Solicitor: Jim Lyons 

SAMPLE LETTER WHEN PURCHASING


RE:     YOUR SALE TO PLUTO

PROPERTY:  23 THE PEARLY GATES, SATURN

Thank you for instructing Lyons & Lyons to assist you with your purchase of the above property.

 We confirm that settlement is scheduled to take place on 15^thof June 2010 in accordance with the terms of the contract.

 As this is your first property purchase we have summarised the following to assist you in understanding what happens between now and settlement.

 Things you need to do

There are three important things you need to do between now and settlement. (please diarise): 

1.                     Ensure that you have signed all mortgage documentation with the bank by about the 3^rd of June 2010. We will liaise with Peter Wotherspoon during the completion period to ensure that the bank has everything it needs to prepare mortgage documentation in time. 

2.         Carry out a final inspection of the property either the day before or the morning of the settlement. This inspection is normally arranged through the selling agent. Please report on any damage that the property or its fixtures may have sustained during the completion period. 

3.         Arrange contents insurance to be effective from the date of settlement. This is not mandatory but it is recommended.

The deposit 

Following exchange, the deposit is normally given to the selling agent to be held in their trust account pending completion of the contract, at which time they will be authorised to release the deposit to the vendor. 

First Home Purchase Government Assistance 

As a first home purchaser you are eligible for the First Homes Owners Grant Scheme rebate of $7,000. The application will be processed by the bank and the $7,000 will be available at settlement at the same time as your loan funds. 

Furthermore, as the value of the property is under $500,000, you are also eligible for the First Home Plus (“FHP”) stamp duty exemption. We will present the application to the Office of State Revenue at the time of paying your stamp duty. 

Transfer 

The Transfer is the instrument that is lodged with the Department of Lands after settlement to transfer the ownership of the property into your name. Without a stamped and executed transfer, settlement can not take place. 

It is really important that the information on the transfer is consistent with the information in the mortgage documents. Any inconsistencies will cause problems at settlement. We confirm that your name on the transfer is to be recorded as JAMES FASTIDIOUS 

Property inquiries

 Now that contracts have been exchanged, we will conduct a series of enquiries to ensure that the following authorities do not have a vested interest in the land:

1.         Sydney Water


2.         Local Council

3.         Office of State Revenue

4.         Roads and Traffic Authority

5.         Transgrid Authority

6.         AGL Authority

7.         State Rail Authority

Bank’s requirements

Banks have certain criteria which will need to be addressed prior to settlement. These requirements will vary depending on the bank and will be attended to by us, for example: 

1.         Copy of stamped front page of Contract

2.         Copy of the transfer

3.         Copy of strata plan (in contract)

4.         Copy of certificate of title (in contract)

5.         Evidence of building insurance (we can obtain if required)

Building insurance

 The insurance on a strata title building is covered by the Owners Corporation, the cost of which is built into the strata levies. This policy includes building insurance and workers compensation insurance but will not cover your contents. Contents insurance is your

responsibility. We recommend that you speak to your insurance company about contents insurance before you enter into possession. If you decide to rent out the property you should arrange Landord’s insurance.

 Final inspection 

 You are entitled to carry out a final inspection of the property prior to settlement; this can be arranged with the selling agent. Normally, a final inspection is scheduled for the day prior to settlement or the morning of the settlement.

 The purpose of this inspection is to ensure that the property has not sustained any damage during the completion period (other than fair wear and tear), and that the condition of the property is the same as when you last inspected it (before exchange).

Possible causes of delay

 We will do everything in our power to ensure that your purchase is completed on time. However, a number of things are beyond our control that may cause delays; for example: 

1.     Failure to finalise finance in time for settlement

2.     Changing your mind about your loan product requiring a new approval and issue of fresh mortgage documents

3.     A delay by the bank in issuing the mortgage documents

4.     The property not being vacant by the due date

5.     Problems in relation to the property disclosed by our searches and enquiries 

Should any of these arise you will be notified immediately.

Penalties for delayed settlement

 Should you be unable to settle on the nominated date in the contract, interest will need to be paid to the vendor from the due date of settlement until the actual date of settlement.

 For this reason it is most important that your finance arrangements be in place and that all enquiries are conducted promptly to ensure that settlement is not delayed.

 Penalty interest for late completion is 10% per annum on the purchase price; this is calculated daily and accrues for every day that settlement is delayed until the actual date of completion.

Notice to complete

The contract provides that if either party is unable to settle on the nominated completion date, the other party may issue a Notice to Complete.  It is normally a 14 day notice that makes the

contract “time of the essence”. This means that if a Notice to Complete is issued and the delaying party fails to complete by the 14th day, the issuing party will have the right to rescind the contract.

 If the delaying party is the purchaser, the purchaser forfeits 10% of the purchase price and the vendor can re sell the property and sue the purchaser for damages such as advertising expenses, agent’ commission, deficiency in the sale price etc.

Connection of services


 We suggest that you arrange connection of gas, electricity, telephone and internet services approximately one week prior to settlement. Solicitors can not connect these services on your behalf.

Moving in


 As you are buying the property with "vacant possession" (as apposed to an investment property subject to a tenancy) "vacant possession" technically means that at the time of settlement, the property should be vacant.

 For example: If settlement has been scheduled to take place at 12.00pm, the vendor must ensure that she has moved out and that the property is vacant by 12.00pm. After settlement, the agent will be notified either by fax or telephone that settlement has been effected, at which time they will be authorised to release the keys to you.

 Pre settlement

 Solicitors will liaise with each other and the banks to arrange a time and place for settlement on the appointed day.

Outgoings will be adjusted (see ‘pre-settlement adjustments’ below) and shortly thereafter the vendors’ solicitor will provide us with written instructions as to how they require the balance of the purchase price to be paid.  They will give us a list of cheques totalling the balance of the purchase price. This is called a ‘direction to pay’.

We will then provide your bank with a direction to pay drawing down the available funds from your loan. The First Home Owners Grant will also be available at settlement via the bank.


 If you are contributing part of the funds required at settlement we will give you details of the shortfall required and you will need to arrange a bank cheque in readiness for settlement.

Pre settlement adjustments

Approximately one week before settlement we will prepare settlement figures including an adjustment of council rates, water rates, strata levies and registration fees etc.

 The term ‘adjustment’ in this case simply means that at settlement, you will be required to pay your portion of the rates and levies in addition to the balance of the purchase price. They will be calculated on a pro rata basis from the date of settlement to the end of the rating period.

 You will need to allow an additional $800.00 at settlement to pay for your portion of the rates and levies. When you take possession of the property, the rates and levies will be paid to the end of the rating periods. The above amount is only an estimate; we will know how much the rates are when we receive our property enquiry certificates in a few weeks.

 What is Settlement?

 Settlement is when you pay the balance of the purchase price in exchange for the title deed to the property.

The following parties will be in attendance:

· Lyons & Lyons solicitors

· Your bank

· The vendor’s solicitor

· The vendor’s bank




      Settlement usually takes place wherever the title deed is kept so in this case settlement will take place at a venue nominated by the vendors’ bank because they are in possession of the title deed. Various documents will be exchanged between the parties; cheques will be handed over in exchange for the title deed and assuming all the documents are satisfactory to us and to your bank, settlement will be effected.   You are not required to attend settlement.

 We will contact you by phone to let you know when it has settled so that you can pick up the keys from the agent.

 We are unable to confirm the time of settlement until it is booked in with all the parties. We will aim to book it in for around noon on the date of settlement and will let you know as soon as the settlement time is confirmed.

 Post settlement

 The bank will lodge the transfer with the Department of Lands and a new certificate of title will be issued in your name and forwarded to the bank. They will hold the certificate of title until such time that the loan/mortgage is repaid or the property is sold.

 The Department of Lands will formally notify Waverley Council and Sydney Water of the change in ownership; although this process can take up to six weeks so don’t be alarmed if you receive a future rates notice in the previous owners’ name. You should pay the amount in the notice, even if it’s not in your name.

 Costs you should budget for

 We remind you to allow for the following payments, before settlement:

(a)       Contents insurance

(b)       Loan related costs (application fee, mortgage insurance, registration        fees)

(c)        Legal costs

(d)       Department of Lands registration fees ($380.00 will be deducted from the loan amount or from your account)

Legal costs

 In order to comply with the Legal profession Act, we enclose our Cost Agreement for your approval. If you are happy with the terms, please sign the agreement where indicated on the last page and return it to our office at your earliest convenience.

 We will keep you advised of your matter's progress throughout the completion period, however if in the mean time you require any assistance, please do not hesitate to contact our office.

www.osr.nsw.gov.au/benefits/first_home/ 

First Home

Land tax - NSW Office of State Revenue