The settlement date that you agreed to in the contract is the date on which the balance of the purchase price is paid to the vendor in exchange for the title to the property.
This is an official process conducted between the legal and financial representatives of you and the vendor.
Verification of identity
As an essential component to the process of dealing with a property, you will be required to undertake a face-to-face in-person interview where you must produce prescribed documents (such as passport and driver’s licence) to verify your identity. This can be completed through your solicitor or conveyancer, or alternatively contact the Land Services Group (www.sa.gov.au/landservices) for further information. Mandatory compliance with the requirement commences early 2014.
Rates and taxes
At settlement all outgoings such as rates and other charges will be adjusted between the vendor and you. The vendor is responsible for rates up until and including the day of settlement. You are liable from the day after settlement.
The vendor has an obligation to hand over the property in the same condition as it was in when you signed the contract of sale. You are entitled to make an inspection to check the house at any reasonable time if you stipulated in the contract that the sale was subject to a pre-settlement inspection.
Stamp duty is a government tax that is calculated on the value of the transaction at the date of the contract of sale. Some stamp duty exemptions or concessions may apply. Contact Revenue SA on 8226 3750 for complete details or visit revenuesa.sa.gov.au.
A stamp duty calculator is included on the website to assist you in estimating how much will be payable.
Memorandum of transfer
A Memorandum of Transfer is the document that transfers the land from the vendor to you as the purchaser. It is lodged with the Lands Titles Office by your solicitor or conveyancer at settlement.
Once settlement has taken place you can contact the vendor’s agent or he or she may contact you to make arrangements to pick up the keys to your new home and to take possession of the property. If you wish to access the property prior to taking possession, you may be able to negotiate this with the vendor through their solicitor or conveyancer.
If something goes wrong
If you have signed a contract to buy a house it may be a costly exercise to withdraw even if you have not reached settlement. If the cooling-off period has passed, the contract is binding. If you wish to get out of the contract, you may be liable to pay compensation to the vendor. The amount will depend on the loss suffered by the vendor and is usually based on the amount it would take to re-sell the house, including any loss on the subsequent sale. Read your contract carefully to be aware of the consequences of defaulting on the contract. If you do not wish to proceed with a contract it is advisable to seek independent legal advice as soon as possible.