Understanding Settlement

September 12, 2018
September 12, 2018 Luke

Understanding Settlement

After you have secured your new home at auction or through private sale the legal work begins. For many people understanding settlement is confusing and overwhelming, after all, it’s not often that we have to deal with legal mumbo jumbo and tackle fine print.

The great news is most settlements are actually straightforward, although it might not seem like it to the untrained eye. The best thing you can do is be prepared and fully understand the settlement process so that you can get the most out of this important stage of home ownership.

What is property settlement?

You sign a contract at the time of your agreement to buy and pay a deposit to secure the property. During the settlement period paperwork is prepared and lodged that will legally move the house title from the current owner to you.

When the final transaction happens the paperwork is approved, the balance of the sale is paid and your name appears on the title. Your legal representative (conveyancer or solicitor) will also advise you on transfer tax and required mortgage registration fees that need to be covered before you can accept the title.

In previous times this was done through a face-to-face meeting. New technology now allows settlement to be completed online providing more flexibility.

Who is involved?

Settlement processes normally take place between legal representatives of the buyer and the seller. The other person involved will be the financial representative (your mortgage broker). Even though settlement is handled by professionals it’s important that you understand the process and know where you stand at all times.

How long does it take?

In most cases the settlement period is between 30 and 90 days.

Settlement timeframes are set in advance and are usually dictated by the seller. If you want to negotiate a particular settlement period you need to discuss this with your legal representative and have the discussion with the seller before the contract is signed.

What are your rights?

The property remains in the owner’s possession until settlement, which means you are not legally allowed to enter the premises without permission for any reason.

In most cases, new homeowners obtain the keys and walk into a property in the same condition as when they first inspected it. There are times though when this doesn’t go according to plan.

You are entitled to inspect the property in the final week before settlement which is normally referred to as a final inspection. You will need to arrange a time with the selling agent to meet with you and walk through together.

What do I look for?

During a pre-settlement inspection, you are looking for any damage that has occurred since your agreement to purchase. In some cases, this can be through storm damage or vandalism if the property was vacated early. You also want to be sure the owner has removed all rubbish, cleared their personal belongings and all appliances are operational, so make sure the services are connected prior to inspecting the property. If you and your legal representative had special conditions in place as part of your agreement then this is a good time to check that these have been met.

Take a camera to snap anything you feel is out of place and bring it to the attention of the real estate agent and contact your legal representative immediately.

Get insurance early

It’s a good idea to get building insurance for your new home as soon as you sign the contract. Having this in place early means no lag time or delays between settlement and the insurance kicking in will protect you if anything was to happen between purchasing and settlement. After the contract has gone unconditional you are considered as an interested party in the property and you may be liable if something was to happen to the property during settlement. Property insurance is in the best interest of you and your new home, so it’s worth the slight expense to get started before settlement occurs.

Take land measurements

Your Certificate of Title will be very clear about the land size you own, boundaries and fence lines. You can get a copy of your future title plan from your solicitor or conveyancer. Before settlement get permission to check and make sure that all the actual measurements and fence lines correspond with the Certificate of Title.

Let your legal representative know your findings so they can confirm that all is well or take action if there are discrepancies.


Once settlement has gone through you can collect the keys from the selling agent and take possession of the property. The date, day and time of settlement is known in advance and usually settlement goes through to plan. It’s important to note that if your settlement is rejected you will not be able to take possession until a new lodgement is made. While many people like to wait out the front of their soon to be home in a moving van, we always recommend our clients to arrange removalists and trades at least 3 days after settlement to ensure there is a buffer for any potential delays.

Luke Assigal
Parley Property Advisory


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