Settlements traditionally required lawyers and banks to meet in person to check and swap documents and bank cheques. The documents had to then be lodged with the Land Registry Office and government authorities had to be notified about the transaction after it was completed.
Over the last few years an e-conveyancing system has rapidly developed to replace ‘manual’ settlements.
Historically from October 2021 all existing Certificates of Titles (CTs) are cancelled in NSW and new CTs are no longer issued, resulting in no more paper title deeds. The new process ensures that conveyancing is completed with speed, efficiency and accuracy.
What is e-conveyancing?
e-Conveyancing provides an electronic online business environment for completing property transactions including electronic lodgement with Land Registries and the electronic transfer of funds at the time of settlement. The vendor or any discharging mortgage or other third-party payee, receives cleared funds same day and there is no reliance on cheques being received with funds not available until cleared.
The new system is a national system. Legislation has already been passed in most states to support e -conveyancing or is underway.
e-Conveyancing is facilitated via a secure online environment to:
- Lodge the Land Title documents needed to register changes in property ownership and interests;
- Allow the various parties involved in the transaction to view and complete the documents online to conclude the property exchange or transaction; and
- Allow for the electronic settlement of all financial transactions at a nominated date and time including settlement monies, duties, taxes and any other disbursements.
- The process currently allows for the system to ‘roll over’ the nominated time’ if necessary on the appointed date which allows last minute issues to be sorted out and settlement to proceed efficiently same day. That flexibility was not easily achieved with manual settlements.
What happens to Certificates of title?
Existing CTs will be cancelled and no longer issued. Existing CTs cannot be required to be produced to have a dealing or plan lodged for registration.
The Torrens Title Register has always been and continues to be the single source of truth as to the ownership of property.
How are landowners impacted?
The 3 main changes from the previous practice for landowners includes:
- Those who pay off their mortgage will no longer receive a CT;
- Purchasers of property without the need for a mortgage (“cash-buyers”) will not receive a CT;
- When a plan of subdivision is registered, and new parcels of land created, CTs will no longer be issued for those parcels of land.
Although the abolition of CTs is a new concept in NSW, it is worth noting that paper titles have not been routinely issued in Queensland for several years.
What replaces CTs?
The Torrens Register will be considered the single source of truth as to a person’s interest or estate in land. All documents to be registered on the Torrens Register must be lodged by an authorised subscriber, who is either a client’s lawyer or conveyancer. The person’s subscriber must verify the identity of their client and prove they have the right to deal with the land. There are various security checks and balances in place to limit the possibility of fraud.
Key Takeaways
- In October 2021, Certificates of Title were completely abolished in NSW.
- The New South Wales land titles system is now completely managed through e-conveyancing. The Australian Capital Territory as well as most states in Australia have joined the e-conveyancing revolution.
- The settlement process is more efficient and in many ways and more secure than the traditional paper one when sometimes issues with cheques or even late arrivals missing a settlement time created havoc for the vendor and purchaser relying on the settlement to be completed that day.
- A vendor will have same day access to their funds which is a significant benefit and payment to any third parties is also made same day. This means funds to satisfy amounts due for council or water rates or for strata levies are all fully paid on the date of settlement. This is a benefit to the purchaser.
- The Torrens Register is the single source as to the ownership of a person’s interest or estate in land.
If you or someone you know wants more information or needs help or advice, please contact us on 02 9699 9877 or email [email protected].