Step 5 – Settlement

Settlement Procedures

Things that have to be done

  • general insurance
  • licence agreement?
  • adjustments
  • arrange settlement with your bank and the other side
  • we attend to settlement on your behalf via PEXA
  • ensure your funds are ready a few days prior to the settlement date
  • do not transfer any funds based on an email request. Always ring us first to verify bank account details.
  • final inspection
  • keys
  • notices of acquisition
  • utilities


As a buyer, prudence demands that you should insure the house at its full replacement cost from the time you sign the contract note. Apart from the protection this gives you, house insurance is a requirement of all mortgage lenders.
This is generally not applicable to units or flats covered by owners corporation insurance.

Licence agreement

In some cases, the purchaser wants early possession of the property before the settlement has occurred. This is not always possible. This can only happen if the property is vacant and the vendor agrees.

Agreement is usually reached on payment of a licence fee (rent) and payment of the Vendor’s solicitor’s legal costs (approximately $300) in preparation of the Licence Agreement.


Prior to Settlement, Hayton Kosky will prepare an adjustment statement apportioning the rates and outgoings to the property as of the date of settlement.

(note: some contracts provide for the adjustment to be undertaken as at the day of sale).

The adjustment of rates will ensure that the Vendors pay all rates and taxes due on the property up until settlement date, and Purchaser pays from the settlement date.

Councils usually require all rates for the current rate year to be paid at settlement even though they may not be due until a later date. This will be reflected in the adjustments.

As of 1 January 2024, by Act of Parliament, land tax will no longer be adjusted, by prohibiting land tax apportionment between a vendor and purchaser. More information on the adjustment of land tax.

Any arrears or outstanding interest on the rates will be deducted from the monies due to the Vendor and paid to the council, owners corporation or authority. There will also be an adjustment against the Vendor for fees pertaining to the discharge of any mortgage or caveat.

Settlement Day – PEXA

Settlement Date is the date the Purchaser takes possession of the Property. The Contract specifies the settlement date or the method to calculate the settlement date. If the settlement date falls on a weekend or public holiday, the settlement will be the first business day after that day (or earlier by agreement).

Settlements are now conducted securely online/electronically using PEXA.

At the appointed time,  settlement funds are provided by way of EFT which includes payment of the balance of purchase price; stamp duty and government transfer fees.

In exchange, the Transfer of title is literally registered with the Land Titles Office contemporaneously. With some exceptions, there are no longer paper certificates of title. Ownership is now an eCT (electronic certificate of title).

The Agent will be informed to release the keys.

Settlement and Cyber Fraud

We always need to verify bank account details by an email and a voice conversation.

WE SHOULD ALL TAKE THE RISK OF CYBER FRAUD SERIOUSLY.  Hackers have impersonated law firms and requested payment via bogus email using their own account details.  It is important you take the extra step to verify any bank account details received in an email by speaking to the person handling your file before transferring money.  Our phone number is 613 9557 3355 and call us.  Do not reply to any email asking for payment before verifying its authenticity with us.

Penalty Interest

If the settlement does not take place on the day of settlement, the Purchaser is liable to pay penalty interest on the balance due to the Vendor. The Penalty Interest rate is approximately 12% calculated daily. You as the purchaser need to make sure all efforts are made to have your finance approved in a timely fashion, mortgage documents signed and that your bank is ready to fund and book settlement for the settlement day. Bank cheques are a thing of the past.

Should you not be ready, you are at risk that a rescission notice may be served incurring further legal costs and risk that your deposit is forfeited if the settlement is more than 14 days after service of the Rescission Notice.

Before Settlement

Final Inspection

The Purchaser has the right to inspect the property purchased within 7 days prior to the date of settlement. Contact should be made to the selling agent who will schedule a time and date for your final inspection. The purpose of this inspection is to confirm the property is in the same condition (fair wear and tear excepted) as at the time you signed the Contract of Sale.

Should the results of the final inspection not be to your satisfaction, you should contact us to see if the matters can be put right. The settlement is usually not able to be delayed, nor can monies be deducted or withheld from the settlement.

It is unfortunate, but your only remedy is an action for damages in the Magistrates Court and most clients simply wear the cost.

If you do not complete your final inspection prior to settlement and upon taking possession of the property to find chattels missing or the like, it may be difficult for any claim to be made against the vendor.


The keys to the property are usually kept with the Real Estate Agent and can be collected by you upon confirmation that settlement has occurred.


Hayton Kosky will endeavour to provide a settlement time to you as soon as possible. However, due to other parties involved, it may not always be possible and for unforeseen reasons settlement can be delayed.


Hayton Kosky will notify the local council and the relevant water authority of the change of ownership.

It is your responsibility to make arrangements for the connection of the Telephone, Electricity and Gas. You should arrange these prior to settlement.

Swimming Pools

It is your responsibility post-settlement to contact the relevant Local Municipal Council to ensure that any swimming pool on the property complies with the current safety laws and regulations.

Smoke Alarms

It is also your responsibility to make sure that the property complies with the requirements pertaining to Smoke Alarms. Contact the Metropolitan Fire and Emergency Services board for further information on 1300 655 511, or visit


If you are purchasing as a Trustee of a trust you must tell us beforehand as the SRO require to be informed of the Trust as part of the stamp duty assessment.

And as the Trustee of a trust, it is your obligation to inform the SRO Land Tax department of the Trust arrangement(s). If you don’t, the SRO can impose punitive land tax rates year on year.


If English is your second language and you require an interpreter to assist in the Purchase/Sale process, or documents to be translated, please notify our office at your earliest convenience so that arrangements can be made.

When you are ready simply fill out the online buying instruction form and we’ll take care of the rest including giving you a fixed quote.

Instant Enquiry