Settlement is the moment everything comes together. It is the legal completion of a property transaction, the point where ownership transfers, funds are paid, and keys change hands. For many buyers and sellers, the weeks between exchange and settlement can feel uncertain. This guide explains exactly what happens at every stage so you know what to expect.

At Strictly Conveyancing, we have been guiding buyers and sellers through the settlement process across NSW since 2006. Here is everything you need to know.

What Is Property Settlement?

Property settlement is the legal process of transferring ownership of a property from the vendor to the buyer. On settlement day, the buyer pays the balance of the purchase price, all legal documents are lodged with NSW Land Registry Services, and the buyer becomes the registered owner of the property.

In NSW, all property settlements are conducted electronically through PEXA (Property Exchange Australia), the digital platform where conveyancers, solicitors, and lenders co-ordinate document lodgement and the transfer of funds. Physical settlement meetings no longer occur. Everything happens online, in real time.

The standard settlement period in NSW is 42 days (6 weeks) from the date contracts are exchanged, though parties may negotiate a shorter or longer period depending on their circumstances.

The Cooling-Off Period

For properties purchased by private treaty (not at auction) in NSW, a 5-business-day cooling-off period applies after the buyer exchanges contracts. During this period, the buyer may rescind the contract by giving written notice to the vendor, forfeiting 0.25% of the purchase price. The cooling-off period does not apply to auction purchases or where the buyer waives it by exchanging with a Section 66W certificate.

The cooling-off period is separate from the settlement period. Once it expires, both parties are legally bound to complete the transaction on the agreed settlement date.

The Property Settlement Timeline: Week by Week

Weeks 1 to 2: Post-exchange preparation After exchange, your conveyancer orders all required property searches (title, planning, rates, water, drainage and, for strata properties, the owners corporation records). If you are buying with a loan, your lender moves toward issuing formal unconditional finance approval. This is also the time to arrange building and pest inspections if not already completed.

Weeks 3 to 4: Documents and co-ordination Your conveyancer prepares the settlement statement, calculating the adjustments for council rates, water charges, and strata levies between the buyer and seller. Your lender issues mortgage documents for signing. The PEXA electronic workspace is opened and all parties (buyer’s conveyancer, vendor’s conveyancer, and lenders) are invited in.

Weeks 5 to 6: Final checks and settlement Both conveyancers confirm all documents are in order and agree on the final settlement figures. The buyer completes their pre-settlement inspection. Settlement is confirmed for a specific date and time. On settlement day, documents are lodged and funds are transferred electronically.

Short settlement periods of 14 to 21 days do occur, usually where a buyer is paying cash or has finance pre-approved. These compressed timelines place significant pressure on lenders and search turnaround times. If you need a fast settlement, contact us early so we can manage the timeline accordingly.

What Buyers Must Do Before Settlement

• Obtain formal (unconditional) finance approval from your lender and sign all mortgage documents promptly
• Complete building and pest inspections and raise any concerns with your conveyancer
• Review the settlement statement prepared by your conveyancer and confirm the figures are correct
• Arrange property insurance to commence from settlement day, not after
• Complete your Verification of Identity (VOI) requirements for PEXA (your conveyancer will advise how to do this)
• Arrange your pre-settlement inspection (usually 1 to 3 days before settlement)
• Confirm the exact settlement funds required with your conveyancer before transferring any money

IMPORTANT: Email scam warning. Conveyancing fraud via email is a serious and growing risk in Australia. Scammers intercept email communications and send fraudulent bank account details, impersonating your conveyancer or lender. Never transfer money based solely on emailed account details. Always verify your conveyancer’s payment details by calling them directly on a number you have independently confirmed, not a number provided in a suspicious email.

What Sellers Must Do Before Settlement

• Arrange for the discharge of your existing mortgage with your lender (most lenders require at least 14 business days notice)
• Complete your Verification of Identity (VOI) requirements for PEXA
• Review and agree to the settlement statement prepared by your conveyancer
• Respond to any requisitions on title raised by the buyer’s conveyancer
• Disconnect services (electricity, gas, internet) from settlement day
• Remove all personal belongings and items not listed as inclusions in the contract
• Leave the property in the same condition it was in at exchange
• Ensure all keys, remotes, and access devices are with the agent ready for release to the buyer

The Deposit: What Happens to It Before and at Settlement

When contracts are exchanged, the buyer pays a deposit, typically 10% of the purchase price, which is held in the real estate agent’s trust account during the settlement period.

At settlement, the deposit forms part of the total purchase price paid to the vendor. The agent releases the deposit funds from trust and pays them to the vendor (or to the vendor’s lender as part of the mortgage payout) at settlement.

If the contract falls through during the cooling-off period, the buyer forfeits 0.25% of the purchase price and the remainder of the deposit is refunded. If the buyer defaults after the cooling-off period expires and fails to complete settlement, the vendor may be entitled to forfeit the full deposit and potentially pursue the buyer for further damages. If the vendor defaults, the buyer is entitled to a full refund of the deposit and may also have a claim for additional losses.

Verification of Identity (VOI)

Before settlement can proceed through PEXA, all parties, including buyers, sellers, and any guarantors, must complete a Verification of Identity check. This is a legal requirement under NSW Land Registry Services rules and is designed to prevent identity fraud in property transactions.

Your conveyancer will advise you on how to complete VOI. It typically involves presenting original identification documents (passport, driver’s licence) either at your conveyancer’s office, at an Australia Post outlet, or through an online VOI provider. VOI must be completed well before the settlement date to avoid delays.

What Is a Settlement Adjustment Statement?

Before settlement, your conveyancer prepares a settlement adjustment statement. This document calculates how council rates, water rates, and strata levies are divided between the buyer and seller based on the exact settlement date.

For example, if the seller has already paid council rates covering a period that extends beyond settlement, they are entitled to a reimbursement from the buyer for the portion covering the post-settlement period. These adjustments are calculated to the exact day and form part of the final settlement figures both parties must agree to before settlement proceeds.

Property Searches: What Your Conveyancer Checks

After exchange, your conveyancer orders a series of government and third-party searches to verify the property’s legal status. These include:

• Title search: confirms current ownership and identifies any encumbrances, caveats, or restrictions
• Section 10.7 Planning Certificate: confirms zoning, land use restrictions, and any orders affecting the property
• Council rates certificate: confirms outstanding rates payable by the vendor at settlement
• Water and drainage search: confirms water rates and service connections
• Land tax certificate: confirms any land tax liability attaching to the property
• Drainage diagram: shows the location of pipes and services on the title
• Strata records (for strata properties): confirms levies, by-laws, and the financial position of the owners corporation

If any search reveals an issue such as an unregistered easement, an outstanding order, or a caveat on title, your conveyancer will raise it with the vendor’s conveyancer and seek resolution before settlement proceeds.

Pre-Settlement Inspection

As a buyer, you are entitled to inspect the property shortly before settlement, usually within 2 to 3 days of the settlement date. The purpose of the pre-settlement inspection is to confirm:

• The property is in the same condition as it was at the time of exchange
• All fixtures and inclusions listed in the contract are present (dishwasher, light fittings, curtains, etc.)
• The vendor has removed all of their belongings
• No damage has occurred since exchange

If you discover an issue at the pre-settlement inspection, contact your conveyancer immediately. Depending on the nature of the issue, settlement may be delayed or a price adjustment may be negotiated. Do not skip the pre-settlement inspection. It is your last opportunity to identify problems before you become the legal owner.

What Happens on Settlement Day

On settlement day, your conveyancer finalises all documents in the PEXA electronic workspace, confirms the settlement figures with all parties, and lodges the Transfer of Land with NSW Land Registry Services. Funds are transferred electronically to the vendor (or their lender) and any surplus after mortgage discharge is paid to the vendor.

Settlement itself typically takes around 30 minutes from the appointed time, though delays can occur if any party is not ready. If you are booking removalists for settlement day, build in some flexibility as settlement does not always happen at exactly the scheduled time.

Once settlement is confirmed as complete, the real estate agent releases the keys to the buyer.

A practical note on keys: Settlement confirmation arrives electronically to your conveyancer first. Your conveyancer then notifies the agent, who releases the keys. Depending on the time of day and the agent’s office hours, there can be a short gap between settlement completing and the keys being physically handed over. Factor this into your moving plans.

For buyers: Can you move in on settlement day? Yes. Once settlement is confirmed as complete, the property is legally yours and you are free to move in if the property is vacant. If the property was tenanted and the tenancy was disclosed in the contract, existing tenancy rights apply and the tenant’s right to occupy continues.

For sellers: When do you receive the funds? Funds are typically disbursed through PEXA within hours of settlement completing. How quickly they clear in your account depends on your bank and the time of day settlement occurs. Most vendors receive cleared funds the same day; in some cases it may be the following business day.

Simultaneous Settlements: Selling and Buying on the Same Day

Many clients are selling one property and buying another on the same day, relying on the sale proceeds to fund the purchase. This is known as a simultaneous or back-to-back settlement and it is one of the most logistically complex scenarios in conveyancing.

If the sale settlement is delayed for any reason, a lender not being ready, a bank processing issue, or a party missing from the PEXA workspace, the purchase settlement can be directly affected. This can result in penalty interest on the purchase, stress on settlement day, and in worst-case scenarios, a delayed handover of your new property.

At Strictly Conveyancing, we have extensive experience managing simultaneous settlements. We co-ordinate both matters closely, keep both sets of lenders aligned, and maintain tight communication on settlement day to ensure both transactions complete as planned. If you are selling and buying on the same day, contact us as early as possible so we can plan the sequencing of both settlements.

What Happens After Settlement

Settlement day is not quite the end of the process. Several important tasks follow:

NSW Land Registry Services registration: After settlement, your conveyancer lodges the Transfer documents with NSW Land Registry Services for official registration of your title. This registration typically takes 2 to 4 weeks to process. Until registration is complete, your conveyancer holds confirmation of the settlement as evidence of your ownership.

Council and water records update: Your conveyancer notifies the relevant council and water authority of the change in ownership so future notices and bills are directed to you.

Property insurance: Your insurance policy should already be active from settlement day. Confirm with your insurer that the policy is in place and reflects the correct ownership details.

Investors: If you are purchasing an investment property, your property manager can now formally arrange tenancy from settlement day.

Stamp duty: Stamp duty is assessed and paid prior to or at settlement as part of the PEXA process. Your conveyancer manages this on your behalf.

What Can Go Wrong: Settlement Delays and How They Are Handled

Settlement delays are more common than most people expect. Here is what causes them and what happens legally:

Buyer-caused delays: If the buyer is not ready to settle on the agreed date, the vendor can serve a Notice to Complete giving the buyer a further period (typically 14 days) to settle. Interest penalties apply for each day of delay at the rate specified in the contract. If the buyer still fails to settle, the vendor may be entitled to terminate the contract and forfeit the deposit.

Seller-caused delays: If the vendor is not ready, for example the mortgage discharge is not in place, the buyer can similarly serve a Notice to Complete. Sellers who delay may be liable to compensate the buyer for additional holding costs incurred.

Finance delays: The most common cause of delay. If your lender has not issued formal approval or mortgage documents in time, settlement cannot proceed. Engaging a conveyancer early and returning all lender documents promptly significantly reduces this risk.

Search issues: Occasionally a search reveals an issue that must be resolved before settlement, such as an outstanding land tax liability, a defect in the vendor’s title, or an unregistered interest. Your conveyancer will manage the resolution, though this can add time.

Bank processing: Even when all parties are ready, bank transfer delays can occasionally push settlement past the expected time. PEXA reduces this risk significantly but it is not eliminated.

Strata Properties: Additional Settlement Considerations

If you are buying a strata unit or apartment, settlement involves additional steps:

• Your conveyancer reviews the strata records to confirm current levies, the financial position of the owners corporation, and any pending special levies
• Strata levy adjustments are calculated in the settlement statement, covering the portion of the current levy period before and after settlement
• By-laws governing use of the property are disclosed in the contract and become binding on you as owner from settlement
• Any outstanding levies or special levies not paid by the vendor are generally required to be settled before or at settlement

Off-the-Plan Settlement: What Is Different?

Off-the-plan settlements occur when the property is registered with NSW Land Registry Services following construction completion, which can be months or years after exchange. Key differences include:

• The settlement date is not fixed at exchange. It is triggered by the registration of the plan of subdivision
• Stamp duty may be deferred for owner-occupiers for up to 12 months from exchange
• A final inspection of the completed property is critical before settlement to identify any defects or incomplete items
• The contract will specify a sunset date, the date by which the property must be registered, or either party may be entitled to rescind

Unusual Circumstances: What Happens If a Party Dies Between Exchange and Settlement

If a buyer dies after exchanging contracts and before settlement, their estate is generally bound by the contract and the purchase must still be completed. The executor of the estate steps into the buyer’s position and is responsible for completing the transaction. The same principle applies if a vendor dies after exchange. Their estate is bound to complete the sale on the agreed terms.

These situations require careful legal handling. If you find yourself in this position, contact us immediately so we can advise on the appropriate steps and co-ordinate with the other party.

Why Choose Strictly Conveyancing to Manage Your Settlement

• Serving NSW buyers and sellers since 2006, nearly two decades of settlement experience
• Over 340 five-star Google reviews, many from clients praising our communication throughout the settlement period
• Licensed conveyancers manage your matter directly from exchange to settlement
• We proactively manage your file, following up searches, lenders, and the other party’s conveyancer so delays do not catch you off guard
• Extensive experience managing simultaneous (back-to-back) settlements
• We keep you informed at every stage so you always know where your settlement stands
• PEXA-registered for fast, secure electronic settlement across all of NSW

📞 Call us: (02) 9630 5553 📧 Email us: mail@strictlyconveyancing.com.au

Frequently Asked Questions

Strictly Conveyancing has provided professional conveyancing services across NSW since 2006. For guidance on your property settlement, call (02) 9630 5553 or email mail@strictlyconveyancing.com.au.