If you’re purchasing a home, you’ll require legal assistance from a professional to aid in the property transfer process. Lawyers and conveyancers are both qualified for the job and can assist with the necessary documentation for property settlement.
Although people often use the terms interchangeably, there are differences between the two. We’ve compiled these differences to assist you in distinguishing between their services.
What are the differences between a Lawyer and Conveyancer?
Scope Of operation
What does a Conveyancer do?
A conveyancer is a legal professional who specialises in executing property transactions, i.e. conveyancing.
According to the 1992 legislation, non-lawyers are authorised to conduct legal work related to a real estate transaction. Therefore, conveyancers do not have to hold a bachelor’s degree in law. However, they are required to do a one-year diploma and another year of supervised training. Their scope of operation is limited to property only.
At first glance, transferring property from one person to another seems easy—just sign a few documents, and voila, the property is now yours. But in reality, many buyers underestimate the amount of work that goes into this process.
If you are not familiar with the territory, it can take weeks to find and submit the correct legal documents. And that’s just a fraction of what the conveyancer does.
Conveyancers usually do the following tasks:
- Going through the contract. Your conveyancer will help you ensure your best interest is being catered for by removing all untoward clauses in the contract. They will inform you of your legal obligations when entering into the contract. A conveyancer will also draft contract conditions that hold up in a court of law.
- Giving legal advice. Conveyancers are licensed to prepare and offer legal advice on the contract – explaining any implications of certain clauses. According to the Australian Institute of Conveyances, conveyancers, like solicitors, have indemnity insurance for offering this advice.
- Making inquiries about the title and zoning of a property. Conveyancers also analyse flooding reports and council approvals, which are all vitally important when buying a property.
- Preparation of settlement papers. A conveyancer will arrange many things, including a settlement date. They will also give you a breakdown of the funds to complete, i.e.the monies that will be paid out to relevant parties on settlement. They also ensure your biggest asset (your property) is transferred in your name correctly.
A conveyancer deals with all parties related to the purchase of a property – real estate agents, banks, mortgage brokers, the seller’s solicitors, the bank’s solicitors, the Office of State Revenue, local councils, buyers agents and any other related stakeholders. A great conveyancer will take the time to talk to you and explain things every step of the way.
Conveyancers can work in any state. However, each state has different requirements and a different set of rules. Therefore, it’s always best to go with someone local who knows all the issues in that area, as this will speed up the process and help you navigate the market.
We recommend the following conveyancers in Brisbane and Queensland:
- KV Conveyancing
- Phone: 0419 220 226
- Email: [email protected]
- www.kvconveyancing.com.au
What does a Lawyer do?
A Lawyer, also called a solicitor, is a licensed legal practitioner whose knowledge of property purchasing is general and broad in nature.
A lawyer must hold a bachelor’s degree in law and still be practising their legal profession. Different lawyers choose different areas of practice. For example, a bankruptcy lawyer specialises in bankruptcy cases, and criminal lawyers deal with crimes and so on.
All in all, a lawyer can specialise in different capacities and operate in any state.
A lawyer does similar things to a conveyancer – and sometimes more – but they are slightly more expensive.
Read more: 5 simple steps to settlement.
Qualifications
A solicitor completes a 4-year Law degree in which they will also study conveyancing. If they want to study conveyancing in detail, they can take it as an elective. Once a lawyer is fully qualified as a practising solicitor, they are automatically qualified to work as a conveyancer.
On the other hand, conveyancers must go through two years of study and spend another year of supervised practical experience before they can apply for the licence. Conveyancers also need to be registered with the Australian Institute of Conveyancers. These requirements are different from state to state.
Fees and costs
How much does a lawyer charge?
Lawyers usually charge an hourly rate and are typically more expensive than a conveyancer.
Lawyers are more expensive due to the high level of education and training required to become one, as well as the specialised knowledge and skills they possess.
Additionally, the legal profession involves long hours and significant amounts of research and preparation, which can drive up costs.
How much does a conveyancer charge?
The cost of a conveyancer ranges from conveyancer to conveyancer. Typically, the cost is between $500-$2,500. In addition to this cost, they also charge for any searches they complete. For every search they complete, they’ll be charged by the relevant body, e.g. council. These charges range from $100 – $1,000, depending on how many searches you complete.
Before you hire a conveyancer, you can ask the following questions so you don’t get hit blindside with extra costs:
- What are your fees and charges?
- What will I have to pay at settlement?
- Are there any other additional costs?
Which one should you hire?
When it comes to choosing between a lawyer and a conveyancer for a real estate transaction, there are a few things to consider.
- Your Budget. As mentioned above, lawyers are slightly more expensive than conveyancers. People mainly hire a conveyancer because they’re often cheaper than a lawyer. So those with a lower budget will lean towards this option. Hiring a conveyancer may be suitable if the property value is low, the budget is tight, or the transaction is straightforward. However, remember that the conveyancer’s lower price means they may offer you less time. So, you may not get the same level of service as you would from a lawyer.
- Size and complexity of the transaction. This matters, especially if you are going to also need to have further representation. If your situation is complex (e.g. a subdivision or off-the-plan purchase), has greater risk, and you feel you might need representation in the future, then you should hire a lawyer because their broad knowledge of the law will help. In this case, their higher fee is justified. But if you are buying a property and everything looks straightforward, then a conveyancer is best.
What about if my transaction is complex or something goes wrong?
If something goes wrong with the transaction and the situation becomes too complex, a conveyancer will refer you to a lawyer. This means you’ll have to pay extra, and it may end up being more costly. However, the lawyer may be able to solve your complex situation.
So, look at your situation, factor in the pros and cons of each, and decide which is best for you. Speak to our team at Hunter Galloway about the options available.
What are the laws regarding conveyancing?
The conveyancing process varies from one state to another in terms of time requirements, fees, regulations, forms, local laws, and government departments.
Every state follows similar steps, but the details vary.
However, every conveyancing and law firm is required to meet the minimum professional standards and regulations of the local legal entities. It is crucial to understand that law firms maintain higher ethical standards than conveyancing firms and have greater penalties in case of non-compliance.
What are the laws in Queensland?
Unlike other states, it is illegal for a licensed conveyancer to have their own firm in Queensland. In fact, all the conveyancing work should be managed and executed by a law firm. Several law firms in Queensland have started a specific conveyancing section which is still part of their law firms and treated as such. These firms must abide by the regulations laid out by the Legal Profession Act of their relevant law society.
So, in Queensland, it doesn’t matter if you are using the services of a lawyer or a conveyancer because they are grouped together. However, the law firm has to hold the latest practising certificate, along with professional indemnity insurance.
Queensland also has a standardised contract which was created by the real estate Institute of Queensland(REIQ). This means that if an agent uses this contract outside the special conditions, the contract remains the same no matter the agent or property. This is awesome and makes things so much easier. Essentially, it allows buyers to enter into a contract without waiting days for a conveyancer to review it.
What about the other Australian states?
In other states, such as Tasmania, Northern Territory, Western Australia, South Australia, Victoria, or New South Wales, it is either a licensed conveyancer or a lawyer who offers conveyancing services.
However, it is important to understand that the conveyancer cannot give any advice unrelated to conveyancing.
Bonus: Other things to consider
Before hiring a legal professional, keep the following things in mind so you can make a well-informed decision:
- Nobody offers a legal service for free. Therefore, beware of those who do offer you free legal services. Most people or organisations who offer free legal services usually have little legal expertise. At best, their advice can be incomplete, but at worst, it can be inaccurate and completely harm your case.
- A reasonable price will have to be paid to hire the services of a reliable professional. Always remember that the price of a professional’s service is usually indicative of their level of expertise and years of experience in their field. While you may be tempted to choose the cheapest option available, consider investing in a reliable and experienced professional to ensure quality work and results.
- Professionals earn their reputation through years of experience in the market and do not offer any incentives or tempting offers to hire a client. Generally, professionals who offer incentives or discounts may not always be the most trustworthy. A reliable professional is confident in their abilities and does not need to offer tempting offers to attract clients.
- Similarly, be careful about giveaways. A fairly new firm tries to attract people by offering giveaways, but the quality of service is crucial to the successful execution of property transactions. Keep in mind that a firm with a strong track record and a reputation for providing excellent service will ultimately be more valuable to you in the long run.
Make sure you keep all these factors in mind when choosing a conveyancer, as it will help you execute the transaction smoothly.
Bonus: Can I do the work of a conveyancer myself?
We live in the Information Age, and it’s never been easier to go it alone. From fixing your iPhone to a car window, there’s a plethora of information online with a how-to guide. If you’re buying a property, you could be tempted to do-it-yourself conveyancing in the name of saving money.
Whilst there are online DIY conveyancing kits, which range between $50-$200, we don’t recommend this if you are a first home buyer or not in the real estate industry. The repercussions for going at it alone and getting it wrong are too severe.
Paying the conveyancing fee is insurance to guard against buying the wrong property with unseen issues. These issues can vary from properties having caveats, not having the right counsel approvals, and even having rates in arrears, which can have disastrous financial consequences.
We cannot stress this enough, don’t go at it alone. When it comes to DIY, it’s better to restrict it to things like painting a feature wall because if you mess it up, you will just be stuck with an ugly wall. But with conveyancing, get professional advice and pay the fee because, in the end, the fee you pay is inconsequential to the potential risks you take by going at it alone.
Bonus: What conveyancing searches should I do?
Your conveyancer will conduct many searches, and this is why we strongly advise you don’t do it yourself because one search may take you a long time. Some of the searches conducted by a conveyancer include:
- Title search. You should not buy a property without this search. The title search shows you who the registered owner is and if any caveats need to be removed before settlement. Ideally, this search should be done twice—first, when you sign the contract and second, on the morning of settlement.
- Registered plan search. This shows you the boundary of the land and where exactly it is situated on the street. This prevents issues of a vendor selling you part of their neighbour’s property.
- Easements and encumbrance search. Easements are created from a need to access your land. For example, the city council may need to access your land to maintain a manhole. Consequently, you will never be able to build over that manhole. So your conveyancer needs to conduct this search, especially if one of the reasons you are buying the property is to build a nice man cave in the back.
- Land Tax search. This search shows whether or not there is any outstanding land tax on the property. If you don’t do this search, any outstanding land tax amount will be passed onto you as the buyer.
- Rates search. This search will show you how much you can expect to pay in rates per quarter or year. This is important because you may think you have found a bargain and then end up having to pay high rates every month. Rates search will also show whether the seller has paid all their rates. If they haven’t, you can get them to pay for any outstanding rates. This search is also useful for adjustments so that the vendor is responsible for the rates until the settlement date, and then the responsibility goes to you after settlement.
- Special water meter reading. In this case, the council representative will check the water meter as close to settlement as possible so that water usage can be adjusted at settlement. This is good to have in case there is a water leakage, in which case the seller has to pay for the additional water usage caused by the leakage.
- Flood search. This is important as it will show you if the property has been flooded before and, if so, what level the water reached. With increased climate change, insurance companies are now wary of insuring properties prone to disasters.
- Transport and main roads search. This will show whether the council intends to build a road or railway near your house. Imagine ten years from now having a noisy highway just outside your backyard. This will also reduce your property value.
- Contaminated land register search. This search will show whether the property you are buying is listed on the Environmental Management Register or Contaminated Land Register. You can terminate the contract if you find out that it is listed and the seller has not told you about it.
- Pool safety register search. If the property you are buying has a pool, you can use this search to ensure a pool safety certificate has been issued, provided the pool safety certificate was not provided with the contract.
- Minor civil dispute search. This will help you determine if the seller is currently in the Queensland Civil and Administrative Tribunal (QCAT) disputing things like trees and fences.
You can also conduct searches against the seller. For example, if the seller has filed for bankruptcy, they may not be able to sell the property to you. You can also conduct a personal property securities register search to ensure that the property you are about to buy will not be repossessed later. Finally, if you think the seller is a bit dodgy, you can also search court records. Some of these searches are free.
The number of searches you conduct depends on the conveyancer you have hired, the type of property you are buying, and your future plans.
Summary – the main differences are?
Lawyer | Conveyancer | |
Scope | General | Specific to property only |
Price | Hourly – more expensive | Fixed – cheaper |
Type of property transaction | Complex | Simple |
Lawyers have a general knowledge of all legal aspects, while conveyancers specialise in property. This is what creates the price difference between the two. The lawyer is more expensive because you will be getting further knowledge within the legal field.
Next steps from here to buy your first home
Our team at Hunter Galloway is here to help you make your home journey easy.
Unlike other mortgage brokers who are just one-person operations, we have an entire team of experts to help make your home loan journey as simple as possible.
If you want to get started, please give us a call on 1300 088 065 or book a free assessment online to see how we can help.
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