What First-Time Home Buyers Should Know About Conveyancing Fees

Conveyancers are required to collect a bundle of transfer and bond costs; some of which are on behalf of other parties: such as the purchaser’s Transfer Duty Tax and the bank’s bond Initiation fee. So the typical statement of account includes more than just what the conveyancer is entitled to debit as his fee. The conveyancer collects money and then pays it to the SA Revenue Services and similarly pays it to the bank.

There are normally 3 parts to a conveyancing transaction; the transfer, the registration of a new bond and the cancellation of the old bond. A conveyancer is required to carry out each of the 3 activities and that is why there will be 3 different sets of fees.

Quite often a different conveyancer will attend to only a part of the 3 transactions. One needs to establish which conveyancer is attending to which part of the transaction.

The fees are determined by means of recognised guidelines and can be negotiated.

However, there is not much scope for economy of scale, as each of the 3 functions cannot be simply replicated on a repeat basis. Each transaction is unique to itself.

The conveyancing costs are always paid in advance of the Deeds Office registration of the transaction. The reason is that the Deeds Office requires proof that the transfer duty has been paid in advance and the bank requires proof that the bond initiation fee is also paid before lodgement in the Deeds Office.

The reason why the Seller chooses the conveyancer is because the seller’s conveyancer is required to pull the buyer into line and also call for payment of the costs, on an arm’s length basis. This is to avoid the purchaser stalling the process, by using his friendly conveyancer to assist in delaying, contrary to the interests of the Seller. The conveyancer is expected to be accountable to the Seller and is charged with collecting the costs from the buyer.

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