If you have ever purchased or sold real estate, you have come across something called a “conveyance fee” or “brokerage fee” at the time of closing or settlement. This would be true if you were the buyer or the seller. A conveyance fee, also called a broker service fee, is a charge to cover the handling of the required paperwork by the real estate company or brokerage as they prepare for the final closing.
In the US, conveyancing is done by the real estate brokerage firms and is considered a “back office” service that is charged separately from commissions, title fees, and other closing costs. In countries such as Australia, however, companies called “conveyancing companies” accomplish the same tasks as do Title Companies in the US, but as third parties to the transaction. A third-party conveyance company is responsible for making certain all of the required paperwork is available, proper, and accurate. This company will attend to all of the details so that there will be no surprises for either party. Companies such as KRG Conveyancing in Queensland, Australia provide this required service as part of their business model for which they will charge conveyancing fees.
Is using a conveyancer necessary?
Yes. This service is extremely valuable, especially in certain situations. If you are looking for a quick closing on the property you are buying or selling, having all of the necessary documentation gathered quickly and accurately by knowledgeable real estate professionals is very important. If you get to settlement and something is incorrect or missing, the entire transaction could be delayed or even be at risk. Additionally, if the sale or purchase is complicated with multiple parties involved or other potentially confounding issues, having someone responsible for following up on all of the details is a necessity. By using the conveyance process, you can avoid the potential pitfalls of a failed real estate deal, and you will have someone watching out for your interest during the sale process.
What does a conveyancer do for you?
For a typical real estate transaction conveyance services would include reviewing the sales contract, preparing a costs disclosure statement, obtaining any necessary certificates, cross-referencing property title information and certificates check, drawing up a land transfer document, supplying copies of all documents to the mortgage holder, preparing a current tax statement, coordinating closing among the parties, and arranging payments. One of the most important things a conveyancer will do for you is keep you out of trouble. Buyers and sellers alike are often in a hurry to complete a transaction. If something is missed and the deal was to go through anyway, a serious problem could come up later, throwing the entire real estate sale into question.
What does conveyance cost?
The average conveyance cost for a house sale or purchase is $900, however, there will be some additional out-of-pocket expenses which include a required “corporation certificate,” which would typically costs $250. Some conveyors also charge nominal fees for photocopying, courier fees, and more, however, considering how complex real estate transactions can be, this is a small amount to pay for the peace-of-mind you receive. An organization called the Australian Institute of Conveyancers (AIC) is an excellent resource to learn in greater detail of the role that conveyancers play in the Australian real estate market. Through the AIC, you can learn of the various methodologies used and services that are most commonly offered.
Being familiar with the conveyance industry will assist you in making the correct choices as you go through the real estate buying or selling process.