Overcoming fear and finding a buddy to play with in the PEXA playground
It is so easy….so why isn’t everyone doing it? Have you ever bought something online or in a shop using EFTPOS? Or do you line up at the bank to withdraw cash?
The electronic economy has been simplifying how we all get paid and how we spend our earnings for decades. Now it is simplifying how the $1.2 billion property market of NSW is being transacted.
Recently one of our lady lawyers bought two (2) investment properties online. The whole settlement process took less than eight (8) minutes, for both. It would have taken us longer to walk to a settlement location and locate everyone involved, let alone stamp, settle and register.
This was not a straight forward settlement. There were a few issues with the bank as the loan structuring was advanced. The matter was ready to settle about two hours before it was scheduled. Had this been a paper settlement, chances are they would not have gone through today, and if they had, it would be a couple of weeks before they appeared on title.
The benefits outweighed any burden ten (10) times over.
- Stamp Duty is pre-calculated and collected on settlement – OSR have integrated their system with PEXA so that we can pre-stamp documents and the payment is collected on settlement from settlement proceeds.
- There is total transparency between all parties – Online conversations allow communication between all parties in regards to what each one needs to happen before the workspace closes down for settlement.
- Up to date title checks – With PEXA having a live feed into the Land Titles Registry, there is up-to-date information about any activity on title. So if a Caveat is lodged at the eleventh hour, you don’t waste your time attending settlement and going to lodge the documents just to find out they won’t be accepted.
- Instant lodgement – Frequently banks would take several weeks to get around to registering the new owner on title. With eSettlements, they appear on title within moments.
- Immediate Clear funds – As the transaction is overseen by the Reserve Bank of Australia, clear funds are disbursed. This means no lining up at the bank, depositing a bank cheque and waiting three (3) days for it to clear, the money is in your account and ready to spend that same day.
- Fewer errors – As there is less re-keying of data, and the Vendor and Mortgagee on title’s information comes directly from the registry, there is a lesser chance of making typographical errors on the documents
- Comparatively priced – If you add up the fees of a settlement agent, express post, bank cheque fees, final search fees and the time it takes preparing the paper documents for a paper based settlement, chances are they exceed the $107.80 PEXA fee.
So why is the legal profession so slow in the uptake of this disruptive technology? I can only put it down to fear. Fear of learning something new. Fear of something going wrong.
“… Fear, whatever it is, both is distinctive. Fear, what happens on Earth stays on Earth. And I can’t take these feelings with me. So hopefully they disperse…” –K Lamar
How does one overcome fear? When you first drove a car, did you do it alone? Or did you have someone sit beside you who had done it before? Was it a family member who had both of your best interests in mind?
eSettlements are made easier by having a PEXA direct specialist hand your hand and double check all your work for the first few matters. It also helps if the Legal Practitioner or Conveyancer on the other side has a little bit of experience and can give you some guidance.
The mutual goal of the matter settling without any problems encourages a more supportive process and the transparency of the online platform informs all parties of any issues immediately.
Electronic methods are now seen to be mandatory
The NSW state government announced in July 2016 an intention to make the lodgement of documents by electronic methods mandatory. https://www.finance.nsw.gov.au/about-us/media-releases/first-step-path-paperless-conveyancing
The timetable has been set to mandate digital conveyancing by 1 July 2019. For more information about the phasing out of paper conveyancing, please see: https://www.pexa.com.au/news/paper-to-digital
Yet there are still some insisting on marking the box as NO for anticipated electronic transaction on eContracts as they are not registered with PEXA. What makes this even worse is the matter is off the plan and will not settle prior to 1 July 2019, so they will not actually have a choice.
TAKE THE LEAP
Outlined above are some of the benefits of eConveyancing. If you are about to sell or purchase and your solicitor has not yet taken the leap, speak to us and we would gladly assist you to benefit from going digital.
This communication is sent by Kreisson Legal Pty Limited (ACN 113 986 824). This communication has been prepared for the general information of clients and professional associates of Kreisson Legal. You should not rely on the contents. It is not legal advice and should not be regarded as a substitute for legal advice. The contents may contain copyright.