04 Apr 2019

6 Steps to an Easy Settlement

6 steps to an easy settlement

Buying property, particularly for the first time, is a huge milestone, but it isn’t always an easy journey. There is a long list of things that can, and do, go wrong on the road to settlement. While some situations are outside of our control, there are steps you can take to ensure an easy settlement, even when hiccups arise.

Contract of sale

The first step to an easy settlement is the contract. This is the starting point of any settlement process and if you can get this right, the rest should follow. A contract of sale will outline the terms and conditions of the sale in addition to valuable information about the property and land. Reading through the contract thoroughly and understanding the terms of the contract is paramount.

At this point, it will be helpful to engage the services of a conveyancer or solicitor who can review the contract to ensure the terms are fair and there are no legal issues. Common issues often relate to the timing of settlement and exclusion of fixtures. A conveyancer or solicitor can negotiate amendments to the contract on your behalf and ensure your interests are protected.

Pre-purchase inspections

Before you sign any contract, you should arrange pre-purchase inspections. Building, pest and strata inspections and/or reports will be crucial when negotiating price and contract terms. Unless stated otherwise, a property is sold ‘as is’, which means pre-purchase inspections are important to uncover any structural issues or pest infestations that may reduce the value of the property, and/or end up costing you money later on.

These inspections may cost a few hundred dollars, but the upfront costs are worth it when you consider the cost of structural repairs down the track.

Exchange of contracts

The exchange of contracts legally completes the property purchase and occurs when both parties are happy with the terms of the contract. The seller and buyer will each receive a copy of the contract that they will need to sign before they are exchanged. This can be arranged by your conveyancer or solicitor.

At this point, a 10% deposit (or another specified amount stated in the contract) is required. A five-day cooling off period usually follows the exchange of contracts. This period allows either party to withdraw from the contract, but hopefully, with your contract thoroughly reviewed, completed pre-purchase inspections and finance in place, the sale will move forward without a hitch.


Arranging your finance in advance is a key step to an easy settlement. Organising a pre-approval before you start looking at properties puts you in good stead when it comes to gaining final approval for a home loan. While a pre-approval isn’t a guarantee, it can give you an estimate of the loan you are likely to be approved for, which is helpful when it comes to agreeing on a purchase price.

At Mortgage House, we ensure the home loan application process is simple, so funds are in place and ready when you need them. We will also organise for the balance of the purchase price to be paid to the seller on settlement day.


The search process is essential to avoid nasty surprises later on. This step involves investigating the title to the land and making inquiries with government departments and local council regarding zoning, restrictions and any government proposals that may affect the property. A conveyancer or solicitor can conduct these important searches for you.

Settlement day

Settlement day is the final step in the entire settlement process and usually occurs between 30 to 90 days after the contracts are exchanged, approximately 42 days in NSW. On settlement day you should conduct a final inspection of the property to make sure it is still in the same condition as when you exchanged contracts – a lot could happen in that time!

On an agreed day, time and place, your settlement agent (usually your conveyancer or solicitor) will meet with the seller’s settlement agent to finalise all legal documents and your lender will organise for the balance of the purchase price to be paid to the seller.

Settlement day is the official time when ownership of the property is transferred and with the assistance of a conveyancer or solicitor and a dedicated lender this step should run like clockwork.

Buying a property?

If you’re looking to buy a property, it doesn’t have to be a difficult venture. At Mortgage House, we’re no stranger to the homeowner’s journey and offering advice and assistance is just part of what we do. Contact us for the best options when it comes to your mortgage and we’ll be there through your application to settlement day and beyond.

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