WHAT IS A CERTIFIED PRACTICING CONVEYANCER?

A CPC is a 'Certified Practising Conveyancer'. To become a CPC a conveyancer must have completed the educational and practical training requirements to hold a conveyancer's licence and be a member of the Australian Institute of Conveyancers Victorian Division. (AIC)

Being a member of the AIC means that the conveyancer must abide by the rules and codes of conduct of the AIC, they must also complete the annual continuing education requirements that are required to renew a conveyancer's licence each year. The AIC provides the facility by which members can complete their continuing education requirements.

The AIC promotes the view that members should complete more than the compulsory requirements set down by the Office of Fair Trading and that continuing education is of utmost importance to the continuing skill and expertise that is needed to remain abreast of the ever changing nature of the conveyancing profession. Most CPCs will complete more than the compulsory continuing education requirements.

 

WHY USE A CERTIFIED PRACTICING CONVEYANCER?

CPCs have the support and backing of the only professional body representing the conveyancing profession in Victoria, the Australian Institute of Conveyancers Vic Division. The AIC, in representing conveyancers, is focused on one aspect of law, conveyancing, and as a member all CPCs are provided with up to date information and the support needed to act competently and professionally in that one aspect of law. Take advantage of the professional service and expertise offered to you by your CPC knowing that you are in the safe hands of an expert conveyancer.

 

WHAT DOES MY CONVEYANCER DO?

When selling property you will require a contract prepared. Your conveyancer will obtain all the mandatory documents that need to be attached to a contract eg. a council zoning certificate, a copy of the title and other title documents, deposited or strata plan, sewer diagram and any other documents that may be required for your particular transaction.

Your conveyancer will draft any special clauses that may be required for your contract and that may be required to disclose particular matters for your sale.

When buying a property a conveyancer will explain the contract to you, organise any property inspections, discuss your financial position and negotiate with the seller's conveyancer/solicitor on any special needs such as extended settlement period, amount of deposit or possession amongst other things. Liaison with your lender on finance approval is also an important function.

Once contracts have been exchanged, a conveyancer will take all the necessary steps to settle the matter and arrange payout or funding of mortgages.

At all times a conveyancer will advise you on various options and act to protect your interests.

 

DO I USE A REAL ESTATE RECOMMENDED CONVEYANCER?

Many estate agents refer clients to a local conveyancers/solicitors. There is nothing wrong with this practice so long as it is based on the professionalism and expertise of the conveyancer/solicitor. If you don't know a conveyancer then this referral may be helpful to you.

Keep in mind that the conveyancer is there to protect your interests and if you would prefer to select your own conveyancer then you can refer to the Institute for a referral or check our web site to find a conveyancer of your own choosing. While there is usually nothing wrong with the agent referring you to a conveyancer you need to feel comfortable with it and it is your choice not the agents as to whom you use.

 

DO CONVEYANCERS NEED TO BE LICENCED?

As of 1 July 2008, any person practising as a Conveyancer in Victoria, who is not an Australian Legal Practitioner, must be licensed to continue to conduct Conveyancing work.

The Conveyancers Act 2006 (Victoria) was introduced into State Parliament after a comprehensive legislative change and thus the new laws for licensing came into effect.

In introducing the legislation the Government was also concerned to address other problem areas such as inadequate professional indemnity insurance, lack of experience and expertise, lack of any professional conduct rules and the absence of any requirement to make proper disclosure to the client of the costs likely to be involved in the transaction.

It was clear that these fundamental problems could only be addressed by comprehensive legislative change and as a result the Conveyancers Act 2006 (Victoria) was introduced into State Parliament and came into operation on 1 July 2008.

 

SHOULD I USE A CONVEYANCER & WHEN SHOULD I SEE THEM?

Certified Practising Conveyancers (CPCs) have the support and backing of the only professional body representing the conveyancing profession in Victoria, the Australian Institute of Conveyancers Vic Division (AIC). The AIC, in representing conveyancers, is focused on one aspect of law, conveyancing, and as a member all CPCs are provided with up to date information and the support needed to act competently and professionally in that one aspect of law. Take advantage of the professional service and expertise offered to you by your CPC knowing that you are in the safe hands of an expert conveyancer.

You should speak to your conveyancer as early as possible. You should, preferably, speak to your conveyancer before you look for a property or before you decide to put your property on the market when selling. Never sign anything before consulting your conveyancer. If you are asked to sign a contract request a copy of the contract first so that your conveyancer can go through the contract with you before you sign. If you do this you will understand what you are signing. There is no such thing as a standard contract.

 

CAN BUYERS & SELLERS USE THE SAME CONVEYANCER?

There is nothing legally wrong with using the same conveyancer. Your conveyancer is working for you giving you the best advice and guidance throughout your transaction.

It is not always possible to give a buyer and seller the same advice and a conflict can arise. Sometimes these conflicts are only small but can have a large bearing on your transaction and it is not always possible to predict when a conflict may arise. The small amount of savings made, if any, when using the same conveyancer will not balance out the risks that are potentially huge. Large delays can be experienced if the conveyancer cannot continue to act for either party if a conflict of interest arises.

Remember that conveyancing is not just the filling out of forms and attending to stamp duty payments. This may be the largest transaction of your life and you will want to know that your conveyancer is acting in your best interests and not compromising with someone else's at the same time.

 

DO CONVEYANCERS HAVE TRUST ACCOUNTS?

Under the Conveyancers Act 2006 Licensed Conveyancers can hold a general trust account designed for the purpose of holding money received from a client, in the course of, or in connection with the carrying out of Conveyancing work. Trust money in the form of funds received from clients on account of fees and charges in advance of carrying out Conveyancing work, must also be held in a general trust account, until such time at their Conveyance is complete.

Part 5 of the Act and Part 3 of the Conveyancers (Professional Conduct and Trust Account) Regulations prescribe strict processes for dealing with any trust monies received.

 

CAN I SELL WITHOUT USING A REAL ESTATE AGENT?

Yes. You cannot list or advertise your property for sale in any way whatsoever until your conveyancer has prepared the proposed Section 32 Statement and Contract for Sale.  Anyone who makes an inquiry or an offer on your property is entitled to ask for a copy of the proposed Section 32 Statement and Contract for Sale.  Please note that can be fines payable if a copy is not available on request.

It is important that if you wish to sell without an agent, that you consult your conveyancer before doing anything further.

 

DO I QUALIFY FOR STAMP DUTY BENEFITS?

Whether or not a purchaser qualifies for Stamp Duty Benefits, be it a partial or full exemption, depends on the conditions of the purchase. You may qualify for stamp duty benefits if you are hold a Concession Card or Pensioner Card.

Any benefits you are entitled to, will be calculated on the value of the purchased property.

To check if you qualify for any Stamp Duty Benefits, you can contact Ballarat & District Mobile Conveyancing or the State Revenue Office.

 

CAN I CLAIM DEPRECIATION ON INVESTMENT PROPERTY?

If you have an investment property, it can be depreciated. Think of it as ‘wear and tear'. Houses, units and commercial properties all qualify. Even older properties can be depreciated. 81% of Australian property investors are not claiming their full tax deductions!

By using an ATO recognised Tax Depreciation Schedule, investors can claim thousands of legitimate tax dollars back on their investments, conserving their cash flow and safeguarding their future.

Schedules can even be backdated so investors can claim up to 4 years of ‘lost' depreciation!

How much money can you claim?

How much you can claim as a tax deduction depends on your individual tax situation.

Doesn't depreciation only apply to new buildings?

Any building where construction started after 18 July 1985 qualifies for the 'Special Building Write-Off'. That means you can depreciate the original cost of construction. Plus, for all buildings, there are a host of depreciable assets like hot water systems, blinds, floor coverings and stoves that may be depreciated.

Can renovations be depreciated?

Yes. The 'Special Building Write-Off' can be claimed as long as the renovations were undertaken after 26 February 1992. Investors can also claim Architects and Engineers Fees. Structural inclusions such as retaining walls and sealed driveways, if undertaken after this date, can also qualify.

Ballarat Mobile conveyancing recommends that you take advantage by using a Tax Depreciation Schedule to help you maximise your Tax Depreciation.

Please note that we recommend Depreciator to you on an independent basis and we do not receive commission or other benefits from Depreciator.

Depreciator has an Australia wide network of Quantity Surveyors and appropriately qualified people. They supply Tax Depreciation Schedules to one of Australia's largest accounting groups and two of Australia's largest real estate groups. Their service is cost effective and efficient.

What are the benefits of using Depreciator?

The fee is 100% tax-deductible. And if you pay by June 30, you can claim it back almost straightaway.

Depreciator specialises in Tax Depreciation Schedules. This ensures that you receive the maximum tax-deductible depreciation you are entitled to.  Depreciator provides comprehensive report that sets depreciation entitlements on a yearly basis for 20 years - saving you money for the next 20 years!  The Tax Depreciation Schedules are suitable for all types of property investors - companies, partnerships, trusts, individuals and couples.  Hassle free - all you need to do is fill in the Online Application Form and Depreciator will take care of the rest.

There is even a guarantee! - "If Depreciator can't find more depreciation than their fee in the first full year, the Schedule is free."  The Schedule is transferable to future buyers if the property is sold.  The Schedule has calculations for both the Prime Cost and Diminishing Value methods so you and your accountant can select the most tax-effective strategy.

Who is Depreciator?

Depreciator is a Quantity Surveying company whose sole focus is the preparation of Tax Depreciation Schedules for individual investors. They cover all capital cities and many regional areas.

Their specialist skills ensure that clients receive the maximum depreciation allowable on their investment properties. For further details on Depreciation Schedules, please visit Depreciators website at www.depreciator.com.au

 

WHAT IS A CAVEAT?

A caveat is a document lodged at the Land Titles Office to protect the rights of a person who claims to have an interest in the land. The caveat itself does not create anything, nor does it initiate any rights not already in existence. It does however act as an injunction, restraining the Registrar of Titles from registering any dealings with the property without first notifying the caveator.

There can be caveats over land without the knowledge of the proprietor, and may only be discovered once proceedings for the transfer of the land have begun. The finding of a caveat can often lead to delays up to 90 days or more between the time of signing the contract until settlement is achieved.

Any person claiming an interest in land is entitled to lodge a caveat on title, but cannot be lodged if no legitimate interest exists. Caveats can be removed through withdrawal by the caveator in an approved form.

 

WHAT IS A COVENANT OR EASEMENT?

Covenant

A covenant is a contractual agreement, creating an obligation to the owner of the land that the covenant affects.  It is passed over with the property when transferred. A covenant is used, in most cases, to preserve rights and regulate standards outside the range of easements (see below) and can either be positive or negative to the owner of the land.

Covenants can include particulars such as the minimum floor size of a house, the materials used for building, or even the use of objects on the property such as business signs.

Easement

An easement is an interest in land that allows a person to have beneficial use of another's land for a specific reason. It is therefore a restriction on the land over which the easement is held.

Easements come in many forms and property related services, but some of the most common in residential areas are sewer and drainage easements, and the combined use of a single driveway for two adjoining properties.

Some easements provide the right of passage for another over the other's property. Some easements require maintenance, meaning that to ensure the easement still applies, it must be used; such with the right of passage.  If that passage becomes unused, then that easement may be lost with time.

The particulars of an easement will be stipulated in the Title to which the easement applies. Purchasers should also note that there may be unregistered easements such as sewers, drains, water pipes, gas pipes and underground and/or overhead cables.

 

WHAT IS COMMON PROPERTY?

Common Property refers to the land which can be accessed by others living under the one strata title or owners corporation or all others living within the same block of flats, units, or apartments. The common property will usually include things such as car parking areas, court yards, grassed areas or stairways. The common property is the responsibility of all those who have claim to it; so when repairs or maintenance are required, the costs will be borne by all.

Any land which contains common property must have an appointed Owners Corporation Manager with public liability insurance including reinstatement and replacement insurance for all buildings on each lot with a minimum of $10,000,000 public liability.

 

WHAT IS AN OWNERS CORPORATION?

An Owners Corporation is responsible for managing common property existing between two or more properties. Whenever a plan of subdivision creates common property, an Owners Corporation is responsible for managing that common property. A purchaser of a lot that is part of an Owners Corporation automatically becomes a member of the Owners Corporation when the transfer of that lot to the purchaser has been registered with Land Victoria.

If you buy into an Owners Corporation, you will be purchasing not only the individual property, but also ownership of, and the right to use, the common property as set out in the plan of subdivision. This common property may include driveways, stairs, paths, passages, lifts, lobbies, common garden areas and other facilities set up for use by owners and Occupiers. In order to identify the boundary between the individual lot you are purchasing (for which the owner is solely responsible) and the common property (for which all members of the Owners Corporation are responsible), you should closely inspect the plan of subdivision.

How are decisions made by an Owners Corporation?

As an owner, you will be required to make financial contributions to the Owners Corporation, in particular for the repair, maintenance and management of the common property. Decisions as to the management of this common property will be the subject of collective decision making. Decisions as to these financial contributions, which may involve significant expenditure, will be decided by a vote.

Owners Corporation Rules

The Owners Corporation rules may deal with matters such as car parking, noise, pets, the appearance or use of lots, behaviour of owners, occupiers or guests and grievance procedures.

You should look at the Owners Corporation rules to consider any restrictions imposed by the rules.

Lot Entitlement & Liability

The plan of subdivision will also show your lot entitlement and lot liability. Lot liability represents the share of Owners Corporation expenses that each Lot Owner is required to pay.

Lot entitlement is an owner's share of ownership of the common property, which determines voting rights. You should make sure that the allocation of lot liability and entitlement for the lot you are considering buying seems fair and reasonable.

Further Information

If you are interested in finding out more about living under an Owners Corporation, you can contact Consumer Affairs Victoria. If you require further information about the particular Owners Corporation you are buying into you can inspect that Owners Corporation's information register.

Management of an Owners Corporation

An Owners Corporation MUST BE managed by a professionally qualified Owners Corporation Manager registered with the Business Licensing Authority (BLA).

If you are uncertain about any aspect of the Owners Corporation or the documents you have received from the Owners Corporation, you should seek expert advice.

 

NEW BUILDING WORKS INCLUDING OWNER BUILDER WORKS

Vendors are required to give details of any building approvals, permits and insurance (if applicable) issued in the last seven (7) years.

Subsection 137B(2) provides that domestic owner builder obligations arise if a contract to sell is entered into within a prescribed period, which most commonly is 6 years and 6 months after the date of completion of the work.  Completion means an occupancy permit has been issued (new houses) or a certificate of final inspection has been issued (alterations and additions).

In all cases, the following statutory warranties by the Vendor must be set out in the Contract of Sale:

  • that all domestic building work carried out in relation to the construction by or on behalf of the vendor of the home was carried out in a proper and workmanlike manner;
  • that all materials used in that domestic building work were good and suitable for the purpose and, unless stated otherwise, new;
  • that the domestic building work was carried out in accordance with all laws and legal requirements (including the Building Act and its regulations);

In addition to the above, the following requirements must also be provided by the Vendor:

  • a condition report which is no more than 6 months old at the time of the Contract prepared by a prescribed building practitioner (such as an architect, building surveyor or building inspector) must be given to the buyer pre-contract; and
  • if the value of the work is more than $16,000.00 and the owner is not a registered building practitioner, then building warranty insurance must be obtained and a Certificate of Currency provided to the buyer pre-contract.  The insurance must cover structural defects for 6 years and non-structural defects for 2 years.  Note, however, that the insurance can only be invoked on the death, insolvency or dissapearance of the domestic owner builder.

If you are an owner builder it is important to contact our office so we may assist you with the correct requirements for the Contract of Sale.

 

WARRANTY & TITLE INSURANCE FOR NEW BUILDING WORKS

Warranty Insurance must be taken out by Victorian owners be they owner builders, or building through a registered builder, for all building works with a cost of more than $12,000.00. The idea with Warranty Insurance is that you can have construction mistakes fixed or get your money back if you lodge a legitimate claim. This might be protection against the builder going bankrupt, disappearing or passing away and protection is also given for certain defects identified in the completed works. If the builder simply refuses to repair the shoddy work or return your money, your only option is to take them to the consumer affairs tribunal which can be a lengthy and difficult process. If your builder does go broke, dies or disappears before the complaint is resolved and you're forced to resort to your home warranty insurance, it won't cover legal costs against the builder, which can easily exceed the amount you're attempting to recover.

Choice magazine has published in their edition of March 2014, "the Victorian Managed Insurance Authority has reported Victorian homeowners paid about $87.8m in warranty insurance premiums from May 2010 to May 2011, but only $108,000 was paid out on a total of three successful claims. And about 250,000 Victorians suffered damage at the hands of the building industry in 2010." This means less than one percent of policy holders meet the criteria for making a claim.

Therefore we highly recommend Title Insurance also be taken out to provide you with maximum coverage. Similar to Warranty Insurance, Title insurance has a one off premium however is significantly lower in cost ranging from as little as $300.00 with a much wider range of coverage and softened criteria. There is also no excess on the policy, and the policy lasts for as long as you own the property. A successful title Insurance claim would cover you if by example the builder passed away, by stepping in and arrange repairs and covering any associated costs.


Refer to our Title Insurance information sheet for further information or you can go direct to the websites of the two main providers First Title (www.firsttitle.com.au) and Stewarts Title Limited (www.stewartau.com).

 

SWIMMING POOLS, SPAS & OTHER BODIES OF WATER

Under the Building Regulations all new and existing swimming pools, spas or other bodies of water of more than 300mm in depth (including those constructed prior to 8 April 1991) must have gates and doors installed with self closing and self latching devices (located at least 1.5m above ground level) that returns the door or gate to its closed and locked position at any point from a stationary start as failure to do so may incur a fine. Further information can be obtained from your local council.

 

WHAT IS OLD LAW?

The current system of transferring land is governed by what is known as the Torrens System.

Properties which were brought or sold prior to this system being introduced are called Old Law Chains of Title.

Property still under Old Law must be converted to the Torrens System when transferred, sub-divided, or even sometimes when refinancing.  This is a service that Ballarat & District Mobile Conveyancing can happily assist you with.

 

WHAT IF I’M AWAY ON HOLIDAYS?

If you are going to be away for any part of your transaction, you should contact our office immediately so we can be sure all documentation is in order for settlement.

In some circumstances, you can sign the required documents to effect settlement prior to your departure.  In other cases you may need to appoint a Power of Attorney to act on your behalf, if you have not done so already. Please refer to our previous fact page regarding Powers of Attorney for further information.

When buying property it is also crucial that you have a Will prepared, or if you already have a Will, that it is current and up to date.

 

WHAT IS A WILL & DO I NEED ONE

What is a Will?

When buying property it is crucial for you to also have a Will prepared.  A Will is a legal document that clearly defines how you wish your assets to be distributed upon your death.  

The Importance of a Will

If you die without making a Will ('intestate'), your assets will be distributed according to law.  The reality being your estate will be distributed to relatives whom you most likely have little contact with, while your loved ones miss out.  This can or may lead to lengthy delays and expensive administration in finalising your estate.

If you already have a Will when purchasing property, you should ensure that if required, it is updated to reflect any major changes in your life.  You should ensure your Will is updated under many different circumstances, not just buying or selling property.  For example you may need to update your Will because of change in marriage/defacto or domestic relationships, separations or divorce, starting a family, buying/selling shares, retirement and the birth of grandchildren, nieces and nephews, or any other important person in your life, even your pets can be included!

 

DO I NEED A POWER OF ATTORNEY?

What is a Power of Attorney?

Powers of Attorney are used to appoint a trusted individual to make these important financial decisions when you cannot. There are a number of forms of these legal documents which can be used depending on the circumstances that arise. A General Power of Attorney is used to appoint someone to make decisions on your behalf for a specified time period- for example if you travel overseas and cannot manage your financial affairs. However if you lose your capacity to make decisions permanently, this appointment will become invalid.

An Enduring Power of Attorney continues to apply even where you can no longer make financial decisions for yourself. As the name suggests, an Enduring Power of Attorney will persist even when you are legally incapable of making financial decisions. Creating an Enduring Power of Attorney is equally as important as drafting a will.

Be sure to note that an Enduring Power of Attorney does not permit an individual to make lifestyle, personal or treatment decisions on your behalf. In order to appoint someone to do this, you need an Enduring Power of Guardianship.

What are the benefits?

By creating an enduring power of attorney, you can appoint someone you trust to manage your financial affairs either when you lose capacity or immediately. This will enable you to choose someone who is reliable and financially astute. A power of attorney also minimises financial hardships that may arise if you can no longer make reasoned decisions or attend vital meetings and institutions due to physical disability. These simple documents will ensure that your financial assets are managed with as much continuity as possible.

You can also choose to impose limits on what activities and decisions your appointed attorney can carry out on your behalf. It is possible to outline how you would like your estate be managed which adds to the control you have over your financial affairs. Your appointed attorney can also maintain confidentiality in respect of your investments, property and other financial matters.

An Enduring Power of Attorney is a necessary document for anyone who wishes to ensure their financial affairs are in order before kicking back for the holiday.