Over the next 12 months, the way that conveyancing transactions have been completed for decades is due to change dramatically.
New South Wales will be moving to electronic conveyancing in July 2019 with some transactions compulsorily switching to the online platform as early as July this year.
There is no need for concern, however, and the changes are unlikely to affect everyday people.
A seller will still go to their lawyer to prepare a Contract of Sale and liaise with a real estate agent to find a buyer.
A buyer will still meet with their solicitor to go through a Contract and perform all of the usual enquiries.
The electronic component of a conveyancing transaction, at least at this stage, will relate mainly to preparing the file for settlement.
Settlement refers to the process of coordinating a buyer and their incoming bank, if they are borrowing money to fund the purchase, with the seller and their outgoing bank, if they are paying out a mortgage, to exchange money (usually in the form of cheques), pay out existing mortgages and provide the new mortgagee with title documents to be taken as security for the loan advanced to the purchaser. Settlement is also critical to transferring legal ownership from the seller to the buyer.
For decades this has been done at a physical meeting, usually in the Sydney CBD, whereby representatives from each of the parties and their banks get together and swap documents including cheques, transfers and title documents.
With the onset of electronic conveyancing however, physical cheques are set to be phased out altogether with payment of settlement monies occurring instantaneously over the Internet.
In addition, where in the past the new owner of a property or the mortgagee holding the title documents as security would physically attend Land Registry Services to register the transfer in ownership, this process will also be undertaken electronically.
The days of proudly holding your title deed in your hand once you pay off your mortgage appear to be numbered as well, with physical title deeds to be phased out over time in favour of electronic Certificates of Title.
These changes are aimed at increasing efficiency by removing the need for multiple people to physically attend settlements, improving security around the payment of settlement monies and streamlining the way Land Registry Services and other large stakeholders like banks store information about property ownership.
