The process of conveyancing in Australia has not changed much in the past 100 years! Mountains of paper, inefficient and manual processes – closer to Dickensian practices than the millennial age in which we live today.
In the dark ages ie when settlements are in paper, parties
gather at a pre-arranged time and place (usually in the city) and exchange cheques for Title documents. If a party is held up eg has a car break down, the settlement does not go ahead. If a cheque has a wrong digit on it, the settlement does not go ahead. If the name on the transfer is spelt incorrectly, the settlement does not go ahead.
It might sound ridiculous that a settlement of people’s biggest assets hinges on such little details but that is the way it has always been. Moving trucks have routinely sat outside people’s new houses whilst bank cheques are hastily swapped so that purchasers can move in before the weekend!
In the new, online world, all parties to the settlement collaborate in an electronic workspace. At the moment, there is only one national, online settlement platform – PEXA (Property Exchange Australia).
PEXA is a next generation platform and process compared to
what it replaces. Vendors (sellers) receive cleared funds in their bank accounts minutes after settlement (instead of waiting days for cheques to be banked and clear). Purchasers (buyers) are registered on Title minutes after settlement (instead of potentially waiting weeks for the Titles to register in the paper world). Clients are not required to run around at the last minute collecting bank cheques and delivering them into the city for settlement.
First Class Legal embraced PEXA from day one and was the first legal firm in Melbourne to complete a PEXA settlement
back in April 2015. In August 2018, we were the first legal or conveyancing firm in Australia to settle 1,000 properties electronically.
Much has been written recently about the security of PEXA.
We believe that the system is safe as long as the legal representatives follow best practice guidelines in terms of business grade (rather than domestic) levels of security for their email and computer systems. At First Class Legal, we use Outlook 365 with two factor authorisation for any changes to email addresses and our password registry is managed by an external third party ensuring even higher security.
PEXA has also introduced multi-factor authentication and a Residential Seller Guarantee. This Guarantee provides protection to sellers in the event of certain kinds of fraud.
Some States have mandated dates for the adoption of electronic conveyancing. For example, in Victoria most transactions need to be lodged electronically as of 1 October 2018. In NSW, the mandated date for 100% electronic lodgement is 1 July 2019.
PEXA leaves the traditional paper settlement process behind in terms of efficiencies. Electronic settlements are faster, more accurate and more transparent.
First Class Legal is an advocate for electronic settlements believing that they are more accurate and more efficient for buyers and sellers. firstclasslegal.com.au
This information is purely general in nature and provided as a guide only.
Professional advice should always be obtained to account for your own personal circumstances.