Conveyancing: the process of transferring legal title of property

Conveyancing is the legal process of moving property ownership from a seller to a buyer. The work can be done by a conveyancer or by a solicitor.

One legal practice that writes about the subject splits the process into two stages. Exchange of contracts comes first, and it creates equitable interests. Completion, also called settlement, is the point at which legal title passes. The same practice says the definition it works to has been built up over 400 years, drawing on legislation, regulation and common law principles. It notes that promises made in a negotiation may count for nothing unless they are written into the contract.

People often speak of conveyancing loosely as the paperwork of a purchase, the practice says, while the legal meaning covers a specific set of procedures. A bank guide makes a related point: anyone may handle their own conveyancing, and kits are sold for that purpose, though the guide says such kits generally provide guidance material only. It adds that making sure the contract is understood correctly is critical, that it advises thinking carefully about the risks involved, and that it raises the option of a full-time conveyancer or solicitor with professional indemnity insurance.

The practice also states that each Australian jurisdiction insists on written contracts for land sales, and that the laws and practices that apply depend on where the land is.

The bank guide lists the tasks conveyancing typically involves. They include looking over the contract of sale, preparing, examining, lodging or exchanging it, arranging building and pest inspections, and checking the property for anything outstanding, including arrears, easements or illegal building work. The same list covers paying the deposit, arranging stamp duty and attending settlement to register the transfer.

For a buyer, the legal practice says the first job is to check the sale contract and set out the buyer's rights and obligations before it is signed. Then come the searches, including checks for easements, encumbrances and zoning restrictions, a check that the seller owns the property and has the right to sell it, and preparation of the documents needed for settlement.

For a seller, the practice describes help with legal obligations and special conditions before the property is listed, the contract prepared with the required disclosures, title searches and other prescribed documents, the clearing of mortgages and outstanding accounts on the title, settlement statements, the electronic transfer of ownership, and notice to the authorities after settlement.

The bank says a conveyancer usually advises only on the property transfer, while a solicitor can also advise on related legal matters such as contract terms and tax. The practice makes a similar point and adds that a conveyancer cannot give legal advice on a mortgage, so a matter involving a mortgage or a guarantee may be sent to a solicitor.

The bank says costs vary between solicitors and conveyancers, and that the service fee is only part of the bill: disbursements can include items such as a title search. It suggests asking for a breakdown of likely costs before work begins.

The practice lists property type among the factors, saying leasehold property costs more to process than freehold because of extra legal complexity. It also names the value of the property, since transactions of a higher value involve more detailed checks and more risk, the complexity of the transaction, where multiple owners or a tangled title history demand more work, and the location of both the property and the practitioner.

On fees, the practice says conveyancers usually charge fixed fees for standard work, and that many solicitors do the same, while some solicitors bill by the hour. It argues that any difference in fees between the two is small beside the size of the transaction, which it describes as one of the biggest financial commitments a buyer or seller makes. It adds that third-party expenses such as council certificates and registration fees sit alongside the professional fee, and that charges for bank transfers and anti-money laundering checks can add up.

The bank guide says a conveyancer must hold an appropriate licence for the work. It notes that a licence check can usually be made through the fair trading body of the state or territory, using the licence name and number the conveyancer provides.

The practice suggests asking about experience with similar properties, how the professional communicates, what the fee covers and how unexpected problems are handled. It suggests checking licensing under state rules and membership of a professional body, and it warns that the lowest charge may not bring the best service.

The practice says some jurisdictions allow a buyer and a seller to use the same conveyancer, an arrangement it does not recommend, and that a professional suggested by the selling agent may not put the client's interests first. It suggests engaging a conveyancer or solicitor before making an offer or bidding at auction, so that contracts can be checked early, and notes that hiring one after contracts are signed leaves less chance to spot problems.