Conveyancer cannot do bank transfer for settlement funds

Discussion in 'The Buying & Selling Process' started by mojorising, 9th Nov, 2018.

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  1. mojorising

    mojorising Well-Known Member

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    I have a sale contract settling soon in NSW.

    The conveyancer initially offered me a bank transfer option or a cheque for settlement funds.

    I opted for the bank transfer.

    Now they are saying that they cannot do bank transfer because we are not using PEXA.

    I chose not to use PEXA as it costs an extra $112

    But last time I sold a house (different convyancer in QLD) we did not use PEXA and the funds were transferred to my account electronically.

    The other difference is that this time the conveyancer does not have a trust account.

    I don't know if it is the lack of trust account that is the difference here but can a seller not normally nominate an account for settlement funds to be paid into even if this payment is made direct by the buyer's solicitor?

    My conveyancer is also telling me that they will bank the bank cheque for me on the day of settlement but it will take a few days to clear.

    I thought bank cheques normally cleared immediately.
     
  2. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Plus Member

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    A buyer is not going to transfer funds into just any old account. And even if they did they would not show up for a day or so and you wouldn't want to settle without knowing you have the funds.

    Bank cheques don't clear immediately for some reason.
     
  3. Lindsay_W

    Lindsay_W Well-Known Member

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    Personally I would pay the $112 to get the thing settled asap but that's just me.
     
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  4. Dan L

    Dan L Well-Known Member

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    I don't understand why a parties to a conveyancing transaction baulk at paying the PEXA costs. The benefits of almost instantaneous clearance of funds and immediate title transfer far outweigh the small financial cost. Would have been $112.00 well spent in hindsight.
     
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  5. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Plus Member

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    after you consider all the cheque fees and lost interest it may have worked out cheaper in pexa
     
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  6. Peter_Tersteeg

    Peter_Tersteeg Finance broker and strategist Business Member

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    Does the lender have an authority to draw the funds from an existing account?

    You really just need to speak with the conveyancer and come up with a solution.

    At this point, most conveyancers I know don't appear to be giving clients the option to not use PEXA. There are some transfers that need to be manual, but if PEXA can be used, they'll simply use it and build the cost into their fees. I suspect many conveyancers have absorbed a lot of the cost as it also saves them quite a bit of time.
     
  7. mojorising

    mojorising Well-Known Member

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    I have asked them if we can still go with PEXA.

    It does make things simpler I guess.

    Settlement is still 2 weeks away so I guess there should be enough time to still go with PEXA?
     
  8. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Plus Member

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    I don't practice conveyancing, but would think it could be too late. You would need to get the other side to agree. But check with your conveyancing lawyer
     
  9. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

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    thats pretty standard in my experience

    Solis, often do, conveyancers dont

    ta

    rolf
     
  10. mojorising

    mojorising Well-Known Member

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    I did not really understand the benefits (would have been good if they had been explained at the time of contract). I was just told it was an electronic settlement system that had to be used for cash purchases where the seller has no mortgage. My second buyer had finance so I thought that was good since I then did not have to use PEXA (the first buyer was cash but pulled out) and could save the $112. Anyway I will know for next time.

    Last time I sold a house was 2016 and we did not use PEXA as far as I am aware but I had cleared funds in my account either the same day or the day after settlement based on providing bank details to the lawyer. Maybe they did use PEXA and just never made it explicit.

    This time I am using a conveyancer and assumed it would all go down like before. They even took bank details from me for the transfer which I thought was normal but then a week later (just yesterday) they have flagged it up as not possible to do a bank transfer because we are not using PEXA.

    If I had known that I would have opted for PEXA from the start.
     
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  11. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

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    Its a common problem in my industry too.

    We blabber on to our clients using industry jargon, and often dont address what the actual specific benefit of XYZ is because we assume that our clients would know.

    Its a human thing and isnt easy to unlearn

    ta
    rolf
     
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  12. Scott No Mates

    Scott No Mates Well-Known Member

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    PEXA - Painful Expensive eXchange Account?
     
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  13. jazzsidana

    jazzsidana Well-Known Member

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    Some cost are just not worth saving and this being one of them!.