Conveyancing is the process of transferring ownership of a property from the person or entity who has sold it to the purchaser. Typically conveyancing consists of creating and processing documents so that the transfer of the Certificate of Title runs smoothly. A typical conveyancing transaction has two major phases: the exchange of contracts and completion also called settlement, when equitable rights and legal title passes.
The sale of land is governed by the laws and practices of the jurisdiction in which the land is located. It is a legal requirement in all jurisdictions that contracts for the sale of land be in writing. An exchange of contracts involves two copies of a contract of sale being signed, one copy of which is retained by each party. However, it is usually sufficient that only the copy retained by each party be signed by the other party only — hence contracts are “exchanged”. This rule enables contracts to be “exchanged” by mail. Both copies of the contract of sale become binding only after each party is in possession of a copy of the contract signed by the other party and the exchange is said to be “complete”.
It is the responsibility of the buyer of real property to ensure that he or she obtains a good and marketable title to the land—ie., that the seller is the owner, has the right to sell the property, and there is no factor which would impede a mortgage or re-sale. Some jurisdictions have legislated some protections for the buyer, besides the ability for the buyer to do searches relating to the property.
A system of conveyancing is usually designed to ensure that the buyer secures title to the land together with all the rights that run with the land, and is notified of any restrictions in advance of purchase. Many jurisdictions have adopted a system of land registration to facilitate conveyancing and encourage reliance on public records and assure purchasers of land that they are taking good title.
In Australia privately owned land is now regulated under the Torrens system of land registration, first introduced in 1858. Some parcels of land are still unregistered and commonly referred to as general law land. Property law in Australia is derived from English common law.
Conveyancing in Australia (also called a transfer) is usually carried out by a solicitor or a licensed conveyancer.
Victoria has a 3 business day cooling off period on private sales except when the property is purchased at auction and there is no cooling off period.
A typical conveyance includes, but is not limited to, the following:
Searches tend to take up the bulk of the conveyance. It must be made sure that all rights and title are properly awarded to the seller. Most information is retrieved from state or local (council) authorities.
Depending on the circumstances of each case, and depending on the jurisdiction, a title search may also involve: