Settlement Day is today! What to expect and how to Ensure Everything Runs Smoothly in a Paper Settlement

The settlement is a really exciting process for all parties to the contract. Being one of the most important days of the contract it also means there is a lot of steps both parties must take to ensure settlement happens on the intended date.

How to prepare for settlement day

Here are a few tips that will help settlement day goes as smoothly as possible.

Step 1: Prepare Financial for Settlement

The buyer’s conveyancer will:

  • Conduct property searches to determine if there are any outstanding monies to be paid to any local authorities (such as local council and water authority). They will then send the searches to the seller’s conveyancer and both parties will calculate settlement adjustments to determine how much the buyer will pay the seller at settlement.
  • Determine the amount the buyer is required to pay to the Queensland Revenue Office for transfer duty.
  • Coordinate with their client’s lender (if any) a suitable time for settlement. The time for settlement typically occurs in the afternoon but must occur before 4:00pm AEST.

Settlement adjustments are typically agreed between the parties’ conveyancers on the settlement day or a couple of days prior. If there is a bank involved, the conveyancer will advise the bank how much is required for settlement.

A buyer should:

  • Communicate with their lender to confirm whether they will be ready for settlement by the settlement date stated on the contract.
  • Confirm how much the lender is providing as a loan for settlement.
    • If the lender is not providing the whole amount payable at settlement, then the buyer should arrange to transfer any shortfall funds to a nominated account that the lender has authority to withdraw monies from.
    • Alternatively, if the lender does not have authority for such account then the buyer will need to transfer the remaining monies to the conveyancer’s trust account before the settlement date.
  • Confirm that there is enough money (in the loan and the amount the buyer is providing) to cover the amount payable at settlement, including
    • transfer duty,
    • Titles Office registration fees,
    • the conveyancer’s and
    • bank’s fees and
    • a buffer amount for any fees related with drawing bank cheques or bank fees for settlement.

Step 2: Buyer Inspects the Property

Close to the settlement date, the buyer should arrange with the agent to inspect the property. Most contracts allow the buyer to inspect the property once before the settlement to ensure that the property is in a satisfactory condition, works that were meant to be done by the seller have in fact been done, and any items that were to be included in the purchase are still in the property.

What to inspect?

Things you should check include:

  • lights and electronics
  • plumbing
  • water heaters
  • air conditioners and heaters
  • door handles and locks
  • appliances
  • curtains and blinds
  • windows and glass
  • pool and spa filters
  • check for pests
  • smoke alarms.

If a buyer has any concerns with their pre-settlement inspection, they should let their conveyancer know so they can negotiate a mutually-convenient outcome.

Step 3: The Settlement Procedure

The conveyancers and the party’s banks will attend the settlement, so there is no need for the buyer or seller to be present during the settlement procedure. The settlement will involve:

  • If the buyer has a lender involved, their conveyancer will provide the lender with a current title search ordered the day of settlement to confirm whether the title details have changed (for example a new mortgage or caveat is on the title)
  • The seller’s conveyancer providing a release of mortgage form (if the seller had a mortgage over the property) and transfer documents (if not already provided to the buyer’s conveyancer);
  • The buyer’s lender providing the seller’s conveyancer the cheques requested in their settlement statement.

Once the party’s conveyancers and banks have confirmed they are satisfied with following documents:

  • the transfer documents,
  • other relevant documents and
  • cheques they have received,

the settlement process is complete.

Step 4: After Settlement

Once settlement has been effected, the seller and buyer’s conveyancers:

  • Will contact their respective clients and advise the settlement was completed; and
  • Notify the deposit holder (generally the agent) of settlement, authorising the release of the deposit to the seller and keys to the property to the buyer.

The buyer then has additional steps to complete, which include:

  • The buyer’s lender lodging the release of mortgage, transfer documents and new mortgage documents at the Titles Office (if there is no mortgage, the buyer’s conveyancer will lodge these documents);
  • The buyer will arrange a time with the agent to collect the keys to the property;
  • If there were any outstanding payments to the local authority, the buyer’s conveyancer will advise these authorities of settlement and forward the payment received via cheque at settlement;
  • If a unit or townhouse, the buyer’s conveyancer will advise the Body Corporate of the change of ownership; and
  • The buyer will attend to connecting other services to the property (such as electricity and gas) and take out insurance if they have not done so already. Please beware that most contracts make the property at the buyer’s risk from the day after the contract date so you should take out insurance immediately after the parties have signed the contract.

Should a Buyer Move into the Property on the Settlement Day

Once settlement has been effected the buyer is free to move into the property. However, buyers should remember that there are a number of things that may delay a settlement to the extent that settlement may occur on a later day, for example, concerns with pre-settlement inspections. Accordingly, buyers might want to consider arranging to move into the property a few days after the arranged settlement date.

What if Settlement does not Occur by the Settlement Date

Whichever party is not ready for settlement, their conveyancer will ask the other side to extend settlement. Please see our previous article (in particular item 1) regarding automatic extensions of settlement by up to 5 Business Days.

If an extension of greater than 5 Business Days is required then this will need to be requested from the other side who can ultimately decide whether to grant the extension. If the buyer requests the extension, the seller can elect to make the buyer pay a default penalty fees.

A delay in settlement will not completely stop the buyer from being able to move into the property. The buyer may ask the seller for early possession, but it is up to the seller in this situation to decide whether to grant early possession and they are not required to agree to it.

If you have any questions or require assistance with a conveyancing matter in Queensland, please contact the property team at NB Lawyers for more information.

Written by

Kayleigh Swift, Associate

NB Lawyers – Lawyers for Employers
[email protected]
(07) 3876 5111


Chloe Skubis, Graduate Law Clerk

NB Lawyers – Lawyers for Employers
[email protected]
(07) 3876 5111

About the authors

Kayleigh Swift is an associate in our Commercial and Property team who assists with Employment Law matters. With a high level of experience in commercial and retail leasing, voluntary and involuntary purchase and sale acquisitions, property development and employee relations, Kayleigh provides practical advice to ensure smooth business transactions.

Chloe Skubis is a Graduate Law Clerk in our Property team who assists with various conveyancing transactions. Chloe is very experienced in residential conveyancing and is a problem solver. She always provides efficient service to all her clients.