What settlement day looks like for a purchaser

Settlement day is the day the purchase price is paid, ownership changes hands, and you can collect the keys to your new property. For most purchasers, there is typically nothing to do on the day itself except for moving in (which of course is no easy task). We manage the legal and financial steps behind the scenes.

On settlement day, your bank advances any loan funds to your lawyer’s trust account. Your lawyer then pays the settlement amount to the vendor’s lawyer, after allowing for adjustments such as rates or other agreed apportionments. The vendor’s lawyer receives the money, arranges for any existing mortgage to be discharged, and releases the electronic transfer of title. Your lawyer then registers you as the new owner, together with your bank’s mortgage if applicable.

Once settlement is confirmed, the vendor’s lawyer authorises release of the keys. In most cases, the real estate agent holds the keys and will hand them to you once they receive that authority. Until then, the agent cannot usually release them, even if you are waiting outside with the moving truck.

Delays can happen and are often outside your lawyer’s control. Common examples include the vendor’s bank being slow to provide a final repayment figure or discharge authority, payment processing times, a linked settlement further up the chain, or last-minute issues from a pre-settlement inspection. Your lawyer cannot force another bank, lawyer or party to act instantly, but they will keep pressing for progress and update you once settlement has completed.

If you are considering buying a property, give us a call early so we can guide you through the process and help make settlement day as smooth as possible.

This article is current as at the date of publication and is only intended to provide general comments about the law. Harkness Henry accepts no responsibility for reliance by any person or organisation on the content of the article. Please contact the author of the article if you require specific advice about how the law applies to you.