Do I need a Settlement Agent When Purchasing Land?

Discussion in 'The Buying & Selling Process' started by benzo, 18th Dec, 2019.

Join Australia's most dynamic and respected property investment community
  1. benzo

    benzo New Member

    Joined:
    18th Dec, 2019
    Posts:
    2
    Location:
    Australia
    Just bought a lot in Padbury, WA.
    Do I need a Settlement Agent When Purchasing Land or does the realtor work with my bank (I am pre-approved).
    What are the benefits and example costs?

    Thanks
     
  2. Terry_w

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

    Joined:
    18th Jun, 2015
    Posts:
    35,801
    Location:
    Australia wide
    get lawyer before you sign
     
  3. Westminster

    Westminster Tigress at Tiger Developments Business Member

    Joined:
    3rd Jun, 2015
    Posts:
    9,999
    Location:
    Perth
    You need a conveyancer or lawyer who does conveyancing. I use MDH Legal in Osborne Park if you want a recommendation.
     
  4. Paul@PAS

    [email protected] Tax, Accounting + SMSF + All things Property Tax Business Plus Member

    Joined:
    18th Jun, 2015
    Posts:
    18,445
    Location:
    Sydney
    1. Legal advice on the contract prior to signing. This is the major issue / benefit. IGNORE what any agent says. Take the contract to see a solicitor first.
    2. Searches etc to validate title and issues affecting title
    3. Attending to issues (loads of them)
    4. Resolving issues eg delays, condition etc
    5. They will manage the settlement eg payment etc with vendor and parties to the new loan and discharge of the former.

    Its not a service as much as its technical and professional support.
     
    Westminster likes this.
  5. Perthguy

    Perthguy Well-Known Member

    Joined:
    22nd Jun, 2015
    Posts:
    11,768
    Location:
    Perth
    In Western Australia the offer and acceptance is a standard form contract and there is no need to get legal advice prior to signing

    "Usually an offer to buy property is made using both the Contract for Sale of Land or Strata Title by Offer and Acceptance form, commonly called the O & A; and the Joint Form of General Conditions for the Sale of Land, commonly referred to as the General Conditions. Together, the O & A and the General Conditions constitute the standard contract for the sale of real estate in Western Australia.

    The wording of the O & A is owned by the Real Estate Institute of Western Australia (REIWA) which is the peak industry body representing the interests of real estate agents. The General Conditions document is owned jointly by REIWA and the Law Society of Western Australia. Although there are other versions of these two contractual documents, the versions produced by REIWA and the Law Society of Western Australia are the most widely used in this State."

    https://www.commerce.wa.gov.au/consumer-protection/real-estate-contracts-sale-offer-and-acceptance
     
  6. Perthguy

    Perthguy Well-Known Member

    Joined:
    22nd Jun, 2015
    Posts:
    11,768
    Location:
    Perth
    A settlement agent is recommended. The benefits are that they will sort out any issues and make sure the settlement is completed smoothly. Find your own settlement agent. My last settlement cost me $750. Worth every cent.
     
  7. Terry_w

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

    Joined:
    18th Jun, 2015
    Posts:
    35,801
    Location:
    Australia wide
    What!

    Just because a contract is a standard contract doesn't mean no legal advice is needed. What if the purchaser doesn't understand the terms they are agreeing to.
    It also doesn't mean the contract cannot be modified.
     
    Dan Wood likes this.
  8. Westminster

    Westminster Tigress at Tiger Developments Business Member

    Joined:
    3rd Jun, 2015
    Posts:
    9,999
    Location:
    Perth
    I think people should get advice prior to signing for the following reasons
    1. they need to understand all terms and ramifications of the standard contract (extremely important for first buyers or interstate buyers who are used to different conditions)
    2. they need to know that they can ammend the standard terms and add others and the wording of these may need assistance
    3. they need someone on their team (not the REA who is working for the Seller) to advise

    It can be the simplest of things which trip up a contract like making an offer, thinking you need 21 days for finance so calculate 21 days ahead and put a date in the finance field instead of the words "21 days from acceptance" then find that you are dealing with something like the Public Trustee who can take more than a week to actually accept and then you only have 14 days to get your finance.
     
    Perthguy likes this.
  9. Paul@PAS

    [email protected] Tax, Accounting + SMSF + All things Property Tax Business Plus Member

    Joined:
    18th Jun, 2015
    Posts:
    18,445
    Location:
    Sydney
    I will sell you my non-existent and swampy useless WA property then. It actually not even mine.
    Its going cheap. :eek:

    This is like suggesting you dont inspect a property for building issues because its new. Or obtain a pest & building. Or bidding at auction without loan approval. All reasosn to make a contract conditional.
     
  10. Perthguy

    Perthguy Well-Known Member

    Joined:
    22nd Jun, 2015
    Posts:
    11,768
    Location:
    Perth
    These are fair points. My response was to Pauls implication that legal advice is essential before signing an offer and acceptance in Perth. It's not. My post wasn't suggesting that legal advice is never required, just that it is not essential. Obviously if the purchaser doesn't understand the terms then they should seek legal advice.
     
    Westminster likes this.
  11. Perthguy

    Perthguy Well-Known Member

    Joined:
    22nd Jun, 2015
    Posts:
    11,768
    Location:
    Perth
    That just shows you don't know the process in WA because you can't sell land you don't own. Any settlement agent will pick this up at the first step. You absolutely don't need a lawyer in Perth to find this out.

    With respect, it is not at all like any of those things. I can read and understand a contract but I can't tell if a building is ok by looking at it. It's completely different.

    My advice in WA is that people should be carefulwhen seeking advice from settlement solicitors because I have seen settlement solicitors almost crash settlements more than once. In my experience settlement agents manage settlements a lot more professionally. In WA, conveyancers are licensed and I have found them excellent.

    I'm not suggesting anyone should sign an unconditional contract. I have signed a number of contracts to purchase in WA and none of them have been unconditional.
     

PFA Property Expo is designed in a way that visitors can gather maximum real estate knowledge with added benefits. Different speakers will be presenting on different topics as where to buy, when to buy in this market...