5 Settlement Tips for Home Buyer
You’ve finally saved up for a home loan deposit. You've got your mortgage application approved. Now it’s time for the final stage of the home loan process which is settlement.
Property settlement is the step that gives you ownership of the property. On settlement day, your conveyancer will meet with your lender and the seller’s representative to sign documents and hand over the balance of the sale price.
This part of the home loan process is dominated by legal and financial matters. Usually, there’s no need for you to be present during settlement, but it’s important to make sure that everything is organised before this important day arrives.
Here are five useful settlement tips you can use as a home buyer:
Tip #1: Find a good conveyancer
Conveyancing is the legal process of transferring legal land title from one person to another. A qualified individual that performs conveyancing is called a conveyancer.
A conveyancer will prepare and review legal documents such as the contract of sale. They will arrange the payment of stamp duty, calculate the adjustment of rates and taxes, examine the mortgage agreement, and search the certificate title.
They will arrange on your behalf a meeting between your lender’s and seller’s representative, and liaise with them about the settlement. Finding a good conveyancer can ensure you have a smooth settlement day.
Tip #2: Sort out other expenses
You may have already saved up your home loan deposit and you already know the full price of the property you’re buying, but you will also need to pay for other expenses upon settlement.
These will include conveyancing fees, stamp duty, body corporate fees (if you bought an apartment or a townhouse), home and contents insurance, council rates, moving costs, and lender’s mortgage insurance if you borrowed more than 80% of the purchase price.
Tip #3: Final property inspection
You are entitled to make a final inspection of the property before settlement day. You can contact the real estate agent or the seller to arrange the final inspection. Make sure that the property is in the same condition as when it was sold to you.
Tip #4: Get home and contents insurance
From the date that you sign the contract, it is recommended that you get home and contents insurance. This is to protect your property and your belongings. If you have bought a property under a body corporate agreement, confirm if insurance is already included in the contract.
Tip #5: Double check the funds
You don’t want to cause any delays or have to pay for any settlement charges. You want to make sure that everything will run smoothly. Ensure the funds is cleared on the settlement date. The funds will be organised by your conveyancer on your behalf. It is either you are going to use your conveyancer's trust account (you will deposit the funds and any surplus will be deposited back to your account) or you will have your nominated account to debit the funds (which your conveyancer will determine how much) needed for settlement .
When settlement is done and everything is finalised, you can finally collect your new home's keys and call the property your own.
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