Priority Notice and Caveat for ppor

Looking for some advice.

I am in the process of buying a ppor. Cooling of period has passed and 10% deposit given.

My conveyancer has talked to me about priority notice and caveat. It is optional and I can choose to lodge either one if I want to.

Caveat will cost $550 and priority notice will cost $450. Is the cost reasonable?

I vaguely understand what these are and that they serve to protect my interest in the property.

How important is it to lodge these and is it very common for purchasers to lodge these?

 

Best to seek specific legal advice.

What is the reason?

 

No specific reason. It was presented as an optional thing that can be lodged to protect against frauds and numerous other things.

 

Interesting

When you enter a contract you have an interest in the property - not sure if it amounts to an equitable interest. You won't have a legal interest until the title is registered into your name. In the old days what used to happen was the conveyancers would do a title search on the day of settlement and see if there are any caveats or writs showing others with interests in the property, other than the owners. A few hours later they would go to settlement and then hand over the docs to the bank who would attend to the registration of the transfer and new names on title - this often took weeks, I even had a property which was not in my name when i went to sell it.

There was a NSW case, Black v Garnot from memory, where they checked title on the day of settlement. Nothing there so they proceeded to settle and handed over the money. Days or weeks later they found out that the title could not be transferred into their name as a creditor had a registered interest on title which was lodged a few mins before settlement happened.

Registered takes priority over non-registered interest so the creditors got the property and sold it to satisfy the debts owed by the previous owners.

That is why caveats were recommended after exchange, just in case.

These days it is all electronic. I am not sure exactly how it works but title can be checked seconds before settlement. i think it still takes a few days for the titles to be registered but it is must quicker than before.

So your question to your legal advisor should what are the chances of something like this happening and would the fee to register be worth the protection.

It seems that some use it to generate extra fees too.

 

The caveat basically means that the vendor can't do anything with the property title without you being notified.

Imagine a case where they've received a better offer, they sell the property to the other person and the first you hear about it is when your conveyancer tries to book settlement sometime after that. You could probably take some legal action but would it be worth the expense?

With the caveat in place it's difficult for the vendor to sell the property to someone else, get more finance over it, subdivide, etc.

I've seen quite a few purchaser's solicitors do this. I've never seen a situation where it was needed, but I imagine that if it was needed, you'd REALLY need it to protect your interests.