Glossary of conveyancing terms

Adjustments are the calculations made to fairly divide property-related expenses, such as council rates, water charges, and owner’s corporation fees between the seller and buyer.

These are usually based on the settlement date, ensuring that:

• The seller pays for all outgoings up to and including the settlement day, and

• The buyer takes over from the following day onward.

Many outgoings are billed annually or quarterly (often paid in advance), therefore adjustments ensure each party pays only for their share of the ownership period.

A licensed real estate professional hired by the seller to arrange the sale of property.

Vendors may choose to sell with or without an agent. 

Auctions are public sales held at a set date and time for the public to register and bid to buy the property.

The property is sold to the highest budder (where the sellers reserve price is met), subject to auction rules which are provided to the bidders.

A sale at auction is unconditional once the hammer falls:

• No cooling-off period

• No finance, building or pest clauses

• This provides immediate certainty for the vendor and reduces the risk of fall-through.

A bank guarantee is a financial instrument issued by a bank on behalf of the buyer, promising to pay the vendor (up to the deposit amount) if the buyer fails to complete the purchase.

Some vendors, especially at auctions, may insist on a cash deposit.

Bonds and guarantees may be viewed negatively by sellers, not trusted in the same manner as cash, giving the appearance that financing the settlement may be problematic for you. 

Body responsible for managing common shared land, such as insuring and maintaining common property in a unit or apartment complex.

Owners Corporation Certificate – A disclosure document detailing fees, rules, and liabilities in strata properties.

A pre-purchase report assessing the structural condition and pest (usually termite) status of a property.

Proof of insurance (often required for lender requirements before settlement).

The official legal document showing ownership and encumbrances.

Moveable items not fixed to the property, like furniture or appliances not included in the sale which are to be removed by the seller. On the other hand: Fixtures – Items attached to the property that are sold with it (e.g., built-in wardrobes, ovens.

A legal form allowing your conveyancer to sign documents on your behalf in PEXA.

Areas shared by all lot owners in a strata or subdivided property.

The legally binding agreement between buyer and seller outlining terms of the property sale.

A licensed professional who handles the legal and administrative tasks of transferring property ownership.

Conveyancing is the end‑to‑end legal process that ensures a property’s title moves from the vendor’s name to yours. 

It covers everything from reviewing the Contract of Sale to registering the transfer with the Land Registry.

A short timeframe in which buyers may withdraw from a purchase due to cold feet or change of mind, with a reduced penalty.

A legal restriction (encumbrance) registered on the title which runs with the land and can restrict an owners use of the land (e.g., design or use limitations)

A document that can be served on a party that has breached their obligations under the contract. This can impose legal costs and usually allows 14 final days to rectify the default before the contract can be terminated.

A portion of the purchase price paid by the buyer upon signing the contract, usually 10%.

Out-of-pocket costs paid by a conveyancer on behalf of the client (e.g., search fees, certificates).

The formal release of a lender’s interest in the property upon repayment of a loan.

The State Revenue Office system used to manage stamp duty claims and payments at settlement. Stamp Duty/Transfer Duty – A state government tax payable on property purchases.

A right granted to a third party to use part of the property (e.g., for drainage or access).

Any legal restriction or interest affecting a property, such as mortgages or easement.

The difference between a property’s value and the amount still owed on the mortgage.

A pre-settlement visit by the buyer to confirm the property’s condition and inclusions.

In Victoria, buyers are entitled to one final inspection of the property within 7 days before settlement to check:

• the property is in the same condition as at the day of sale (fair wear and tear excepted)

• that inclusions remain

• that exclusions and occupants have been vacated, or in process so that there are no vacant possession concerns to be addressed prior to settlement.

This is the buyer's last chance to confirm that all included appliances are in good working order, that no new damage has occurred, and that the seller has removed their belongings. If an issue is discovered, the buyer's primary remedy is to negotiate a monetary compensation from the seller's funds at settlement. It is important to note that delaying settlement due to minor issues is rarely possible and can put the buyer at risk of default.

A Victorian government initiative offering reduced stamp duty for eligible first-time buyers within the transaction threshold.

Items attached to the property that are sold with it (e.g., built-in wardrobes, ovens. On the other hand. Chattels – Moveable items not fixed to the property, like furniture or appliances not included in the sale which are to be removed by the seller

A tax measure requiring withholding of currently 15% from sales unless a clearance certificate (Australian tax residents) is provided.

A promise made by a third party (guarantor) to cover a parties obligations.

This may relate to finance: guaranteeing the borrowers obligations under a loan.

This may also relate to directors guarantees where the director of a company is required to personally guarantee the performance of the company. 

Form of co-ownership where the parties own an equal undivided share and upon death of a joint tenant, the property will be owned by the surviving tenant/s (principal of survivorship). Tenants in Common – the other form of property co-ownership where each party owns a defined share. Tenants in common may hold shares equally (50/50) or in unequal portions and upon death of a tenant the inheritance of their share will be determined by their proven Will or rules of intestacy (for those passing without a legal proven Will)

A state tax on property owned, usually relevant for investment properties or vacant land.

The state authority responsible for maintaining the land title register.

A document allowing early possession or access to a property before settlement.

Initial approval from a lender stating how much a buyer can borrow, subject to conditions.

This is not the same as unconditional approval:

• Lenders may offer pre-approval to buyers, which shows a willingness to lend to that buyer on certain conditions, but this does not mean that they are obligated to finance the purchase.

• A lender may decline to service a loan for a variety of reasons, such as change in circumstances or insufficient valuation and lend-to-value-ratio. Their determined value of the property may be impacted by property factors and the surrounding area such as cladding, insufficient sales in the area to determine price or environmental risks in the immediate area.

• While your personal financial situation may support a loan, the specific property may not be acceptable to your preferred lender.

A material fact is any detail a reasonable buyer would consider important when deciding to purchase a property or determining how much to offer.

It is an offence to knowingly conceal a material fact when selling a property in Victoria and penalties apply.

Examples of material facts may include:

• Serious structural issues, major defects, termite infestations

•  Illegal works (e.g. unapproved renovations, zoning issues)

•  Flood/fire history, bushfire overlays, contaminated land

•  Sensitive past use (e.g. drug lab, crime scene, violent events)

• Neighbourhood disputes or disruptive noise sources

• Easements, access restrictions, or known encroachments

A legal agreement in which property is pledged as security for a loan. Mortgagee – The lender or financial institution providing the mortgage. Mortgagor – The borrower who gives the mortgage to the lender.

Property Exchange Australia; the national online platform used for digital settlements and title transfers.

Instead of traditional paper-based settlements, where cheques, title documents, and agents used to meet in person, PEXA lets everything happen digitally, in real time.

In Victoria, electronic settlement is now mandatory for nearly all property transactions.

The final step in the transaction where ownership and funds are exchanged.

Council and water charges associated with a property.

Statement of adjustments are performed at settlement which split the cost of council rates, State land taxes, and financial levies on the property between buyer and seller.

Off the plan contracts will include a date by when the plan must be registered (titled) otherwise the purchaser can rely on their sunset clause with withdraw.

A document requesting early release of the deposit to the seller before settlement.

Sufficient equity is required and a strict process must be followed.

Don’t assume early release is guaranteed even if a Section 27 is served. In practice, most buyers will object.

A disclosure document provided by the seller outlining key property details and obligations.

A Section 32 Vendor’s Statement must be provided to a prospective buyer before the buyer signs a contract.

The agreed date on which the property legally changes hands.

Involves ownership of a unit and shares in a company that owns the common property. An older form of ownership (pre-1967) and is governed by company law, not strata laws. Stratum titles can be harder to finance and manage, and are often converted to strata titles today.

A subject to finance condition (conditional on loan approval) allows a buyer to withdraw from the contract if they are unable to secure satisfactory finance by the due date.

The condition comes with prescribed qualifications that a buyer must meet.

This condition is not automatic and must be included in the contract.

It is a critical protection for buyers to avoid being legally bound if they cannot obtain funds to complete the purchase.

A deadline by which certain conditions must be met, or the contract may be cancelled. Typically for off the plan contracts this relates to the deadline for the subdivision to be completed (land titled).

A form of property co-ownership where each party owns a defined share. Tenants in common may hold shares equally (50/50) or in unequal portions and upon death of a tenant the inheritance of their share will be determined by their proven Will or rules of intestacy (for those passing without a legal proven Will).

Compare with: Joint Proprietors the other form of co-ownership where the parties own an equal undivided share and upon death of a joint tenant, the property will be owned by the surviving tenant/s (principal of survivorship).

The document lodged with the Land Titles Office (LUV) to legally transfer ownership. Land Use Victoria (LUV) – The state authority responsible for maintaining the land title register.