Unless you are a suitably qualified lawyer, it would be very unwise to try to carry out the settlement of your own property. It's a complex and time consuming business, with many traps for the unwary.
When you are buying a property, it is necessary for all the paperwork to be completed and all the promises to be fulfilled in the contract for the sale of the property. Such work is known as conveyancing. If you don't want to do this yourself, you must employ a licensed settlement agent or a lawyer with a current practicing certificate in law to attend to all these details on your behalf.
The main difference between employing a settlement agent as opposed to a lawyer is that settlement agents are not qualified to give you legal advice. However, a settlement agent is required by law to let you know when it is a good idea to get legal advice.
Conveyancing is the legwork to make sure the promises in a contract are carried out.
Using a settlement agent
- Settlement agents must be licensed to operate in Western Australia.
- A settlement agent must provide you with a written quote (costs disclosure) setting out the maximum amount they will be charging for their services, before you sign the appointment to act. The maximum amount must include all fees, commissions, charges and general office disbursements payable for the settlement agent’s service.
- Settlement agents must give you an Appointment of Settlement Agent form that you and the settlement agent need to sign which authorises the agent to act on your behalf.
- If someone who is involved in buying or selling the property, such as the real estate agent or bank that is lending you money suggests that you use a particular settlement agent, they must give you a form for you to sign that explains your rights.
Settlement agents cannot act for both the buyer and the seller unless both the buyer and the seller give permission to do so on the appointment form. You do not have to use a particular settlement agent because someone else has suggested or recommended you do so.
Information about using a lawyer
Lawyers must have a current practising certificate in law from the Legal Practice Board to perform conveyancing in Western Australia.
What to expect from the settlement agent or lawyer conducting your settlement
He or she:
- ensures the completion and lodgement of documents to transfer the details of ownership on the certificate of title;
- makes necessary enquiries, such as title, rates and zoning; double checks that all inspections and other special conditions in the contract have been completed prior to settlement and ensures that their client is satisfied that the conditions have been met;
- requests funds to proceed to settlement;
- keeps you informed about the progress of buying your property and lets you know about any problems; and
- attends settlement on your behalf.
You are free to choose or change the person conducting your settlement at any time. However, if you do, you may be required to pay some money for the work already done on your behalf.
The person conducting your settlement must either not take on a client or cease to act for an existing one if they have a conflicting interest in the transaction.
Information about choosing a settlement agent or lawyer
When selecting a settlement agent or lawyer, shop around using the Yellow Pages and ask for recommendations from family and friends. It is recommended that you choose your own settlement agent or lawyer, who is not also providing conveyancing services to the other party.
Settlement agents are able to determine what fee to charge their client for their services. You can for a quote before deciding on which settlement agent to use. In any event, the settlement agent must provide you with a written disclosure of the maximum amount that they will charge you, before you officially appoint them to act on your behalf.
Settlement agents and lawyers will also pass on to you a range of disbursement costs that are incurred in processing the settlement. These costs may include charges related to telephone calls, facsimiles, photocopying, postage, stationery and courier costs. With settlement agents, these disbursement costs must be incorporated into the maximum amount disclosed to you prior to your appointment of the settlement agent.
The Choosing a settlement agent fact sheet provides general information about choosing a settlement agent or solicitor along with their respective roles in a property transaction.
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