Frequently asked questions
Apart from the fact that our fixed fee is lower than that charged by almost any settlement agent we could find after extensive research? You also receive the additional assurance of having an experienced property lawyer supervise your settlement! We take maximum advantage of new technology including the electronic settlement system PEXA and, unlike mots competitors, pass the savings on to you.
Most settlements are straightforward and proceed without issues. On occasions, however issues arise which could cost you thousands of dollars if not resolved. Some examples are given at the end of this FAQ.
Our extensive experience in property law gives you an advantage over using a Settlement Agent when identifying issues which may cause you trouble or expense and resolving them.
If a legal issue arises and you were using a Settlement Agent, they would need to refer your matter to a lawyer for specialist advice. Using Fortuna Legal to conduct your settlement in the first place can save you fees if a legal issue arises. We will give you basic legal advice on a wide range of issues that may arise under a settlement within our low, fixed fee.
If we are handling your settlement and a legal issue arises where a Settlement Agent would need to refer you to an outside lawyer, we will already be fully familiar with the matter. This means that you will save on the fees which a lawyer would charge for being briefed on the issues by the Settlement Agent.
We offer a great team of highly trained, experienced staff who are committed to delivering incredible customer service for a competitive fee. We are dedicated to ensuring our clients are satisfied with all aspects of the settlement process.
Feel free to call us for a private confidential discussion of your settlement needs.
EXAMPLES OF SETTLEMENT DISPUTES
- A contract contains a special condition requiring the property to be free of structural defects. There is a serious crack in a wall that has been plastered over (so you did not notice it when you inspected the property). Builders engaged by each party disagree about whether it is actually weakening the ability of the wall to hold up the roof.
- The other party may fail to meet its obligations for financial or other reasons, or
- A third-party involved, e.g. a bank providing a new mortgage or discharging the seller’ s mortgage, creates a legal problem.
No! In many cases Real Estate Agents have a financial interest in the Settlement Agent which they recommend. Or it could just be their friend. While we do not suggest that either of them would act improperly, the Settlement Agent may have a conflict of interest in such a case. The Real Estate Agent’s interest is to get the sale through as quickly as possible and earn their commission. Your interests are of course to get the purchase through too – but not at any cost.
In some cases there may be an issue with the settlement which may not prevent it going through but which could cause you problems later. In those cases, we have no financial incentive to “wave the settlement through”. We will fully inform you of the issue and what your legal rights are in resolving it, even if that means delaying settlement while it is sorted out.
IMPORTANT: This information is not legal advice. You reading it does not give rise to a solicitor/client relationship with us. It is general information only. It may be affected by the specific circumstances of your situation. You should not act on anything on this website without obtaining specific legal advice from us.
It is possible but it’s a bad idea. Sometimes both parties are talked into using the same Settlement Agent, often by the Real Estate Agent, for a supposed reason like:
- you will each pay a lower fee if you use the same Settlement Agent, or
- the settlement will go through “more smoothly” if you both use the same agent.
You may pay a lower fee, but only if no issues arise. If an issue arises you may pay a much higher fee, as explained below. And issues do arise on a substantial number of settlements. These issues are not usually serious and are mostly resolved amicably and fairly. But they are resolved fairly only when each party has an independent professional pushing their client’s side of the issue hard. But they can’t do that if they’re acting for both sides!
If a problem arises where the Settlement Agent is acting for both parties they immediately have a conflict of interest and cannot fairly represent the interests of both sides. In that case professional ethics would require the Settlement Agent to cease acting for both parties. This would lead to each party incurring additional fees and delay as a result of engaging a new professional to take over their side of the settlement.
Worse, there could be a case where the other party has breached the contract but you would not be aware of it unless your Settlement Agent brought it to your attention. The problem could cost you thousands of dollars to fix when you become aware it down the track. Your Settlement Agent has an incentive to let it go so that they don’t have to cease acting for the parties and lose their fees for taking the settlement through to completion. Of course a reputable Settlement Agent would never do that, but every industry has that element which is prepared to cut corners. You don’t want to put yourself in a position where this risk could even arise.
And your settlement could only go through ” more smoothly” by using the same Settlement Agent as the other party if the Agent cuts corners. The same amount of work has to be done on each side, regardless of whether the Agent is representing one party or both.
A “Settlement” is the process of changing the title from the name of the Seller to the Buyer, paying the purchase price to the Seller, removing the Seller’s mortgage (if any) from the title and registering the Buyer’s mortgage (if any) on the title.
Where you are the:
- Buyer, and you are borrowing to complete the purchase, we liaise with your lender to ensure they make the loan funds available to the Seller at the nominated settlement time, or
- Seller, and there is a mortgage on your title, we liaise with the lender to ensure that it receives the amount necessary to pay out the mortgage at settlement and removes the mortgage from the title to allow the property to be transferred into the Buyer’s name.
If either of the above applies to you, you must sign any documents and do anything else which your lender requires you to do promptly to ensure that there is no delay to settlement. If settlement is delayed by more than three business days and it is your fault (including your lender’s fault) the other party may claim penalty interest against you.
Where you are the Buyer we arrange for the contract to be assessed for stamp duty, collect the duty from you and pay it on your behalf.
Often the Seller has paid Local Government rates and water rates which cover a period beyond the settlement date. Therefore, the Buyer must compensate the Seller for that part of those rates. We calculate the correct amount and add it to the purchase price as part of the process.
The contract often contains special conditions which must be satisfied before settlement can proceed. If a condition which is your responsibility is not clear, we will advise you what you need to do to comply. We also check that the other party has fulfilled their contractual obligations before allowing settlement to proceed.
The contract often allows between 3 to 4 weeks for settlement after any finance condition has been fulfilled. Under the new electronic PEXA system, however, it is possible to complete settlements more quickly than this. Settlement times may come down to 2 weeks in future when parties become more familiar with the advantages of this system.
No. Most settlements in WA are done via an electronic system called PEXA. We attend to everything on your behalf. All persons comprising the buyer/seller, or all directors if the party is a company, do need to attend our offices to be identified and produce photographic ID to a required standard (which we will inform you).
If for some reason you be unable to attend our office, we can arrange for a mobile identification service to visit you. If you will be out of WA please also let us know in advance as identification processes or other States and overseas can also be put in place.
When your transfer is lodged for registration at settlement, the:
- Local Government
- Water Corporation and
- State Revenue Office *
are automatically notified of the new purchase. The buyer and seller need to notify other service providers, however, such as the electricity, gas and telephone companies.
(*State Revenue is relevant only where land tax applies i.e. if you are selling or buying an investment property.)