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Created:
16 May 2007

NSW conveyancing dictionary

We do our best to describe conveyancing in plain English. But are you scratching your head about legal terms that keep popping up? We maintain this list of definitions to help you stay on top of your transaction.

A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

A

Auction
A public sale of a property where the property is bought by the highest bidder.
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C

Caveat
A warning on a Certificate Title that someone other then the owner might have some interest or right in the property.
Commercial property
Property used predominantly for commercial or retail purposes such as a shop or offfice.
Construction Loan (Building Loan)
A loan to finance the construction of a house. The lender makes payments to the builder at intervals as construction work progresses.
Contract for Sale of Land (Contract)
A standard written agreement setting out the terms and conditions on which the seller and purchaser enter into for the sale and purchase of a property.
Cooling-off Period
The legal right of a buyer to withdraw from a contract for purchase of residential property by giving written notice to the seller within 5 business days (in NSW) after exchange. A cooling-off period does not apply if:
  • The property is purchased at an auction or on the same day as an auction.
  • The purchaser receives independent legal advice prior to the purchase of the property and waives their cooling off rights.
Conveyance
The legal transfer of a property's title from the seller to the buyer.
Covenant
A right or obligation affecting a property and noted on the title of that property for the benefit of some party eg a property might be affected by a covenant restricting the property owner from constructing a dwelling of material other than brick.
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D

Deposit
A deposit is normally paid by the buyer at the time of exchanging contracts or on "fall of the hammer" at auction. It is normally 10% of the purchase price.
Deposit Bond
A written undertaking by a company to be answerable for payment of a deposit on the purchase of a property in the event of non performance by the buyer.
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E

Easement
A right granted to a person to use the land belonging to another, e.g. a neighbour may have an easement to drain water across an adjoining property.
Exchange
The sale contract is prepared in duplicate, usually by the seller's solicitor or conveyancer. The original is signed by the seller and a copy is signed by the buyer. The signed contracts are then exchanged and the buyer and seller each receive a copy signed by the other.
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F

First Home Buyers Grant
Funds from the Federal Government giving $7000.00 to first home buyers as a one off payment after they have bought a property.
First Home Plus
A discount on stamp duty payable on transfers and loans for first home buyers from the NSW Government. The benefit only applies if the value of the property being purchased is less than $600,000.00.
Freehold
A property where you own both the property and the land on which it is built.
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H

Home Loan
The funds a buyer has to borrow (usually from a bank or other financial institution) to purchase a property, generally secured by a registered mortgage to the bank over the property being purchased.
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I

Industrial property
Property used predominantly for industrial purposes such as a factory.
Information Pack
Lawlab's set of standard documents.
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L

Land & Property Information
Commonly referred to as the LPI. Government Office situated in Sydney which holds original Certificates of Titles to all land in New South Wales.
Licence Agreement
Where a buyer requests possession of a property prior to settlement and the seller agrees. Document which outlines the party's rights in relation to the property.
Loan documents
The documents the lender requires a borrower to sign before the lender will advance loan monies to the borrower.
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M

Mortgage
A security taken by a lender over the property of the person the lender is lending money to. The effect of a mortgage is that the borrower cannot sell the property without repaying the loan and if the borrower fails to repay the loan the lender (mortgagee) can sell the borrower's property.
Mortgage Broker
An individual or company that obtains loans for others by finding lending institutions to lend the money.
Mortgage documents
the documents the lender requires a borrower to sign before the lender will advance loan monies to the borrower.
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O

Off the Plan
Buying a property, usually an apartment, from the plans of the building. This may take place before construction.
Owners Corporation
A company run by all of the owners of units in a strata building.
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P

Pest & Building Reports
These reports are usually obtained by buyers prior to exchange. A building report is a report by a licensed builder inspector detailing the condition of the building being purchased. A pest report is a report by a licensed pest inspector detailing whether building is adversely affected by pests such as termites and borers.
Pre-approval
An approval for a home loan credit issued by a lender before the borrower has selected a property. Usually issued for a stated maximum loan amount and conditional on a valuation being obtained for the property.
Pre-purchase inspections
the qualified inspections undertaken by buyers of properties prior to exchange or during the cooling off period. Typical pre-purchase inspections include pest reports, building reports and strata reports for strata title properties.
Purchaser
The buyer.
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R

Real estate agent
A person licensed to negotiate and sell property on behalf of the property owner.
Refinance
The process of paying off a loan with the proceeds from a new loan using the same property as security.
Required searches
the searches required by law to be contained in a contract for sale of residential property. The searches include title search, zoning certificate and sewer diagram.
Rural land
Land used for farming.
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S

Settlement/Completion
The event at which the purchase of a property is finalised by the legal representatives of the seller and the buyer. Title documents are delivered to the buyer's solicitor in exchange for the balance of the purchase monies. At the same time mortgage documents come into effect, costs are paid and the new owner takes possession of the property.
Sewer diagram
a diagram issued by the local water authority disclosing the location of the main sewer line in relation to a property.
Sewerage connections diagram
a diagram issued by the local Council/water authority disclosing the connections from a property to the main sewer line.
Stamp Duty
A state tax on a conveyance or transfer of real property payable by the Purchaser calculated on the total value of the property.
Strata search
These reports are usually obtained by buyers prior to exchange where buying a strata title property. The report covers issues such as the history of the building, all recent repairs undertaken, any disputes or areas under investigation, monies in the bank to cover repairs and maintenance and the likelihood of any special levies, insurances and by-laws.
Strata title
A form of title used for units and townhouses. It gives the owner membership of an Owners' Corporation, and the ownership of a defined part of a building. Strata titles are registered under the Torrens Title system.
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T

Title deed
Also known as the Certificate of Title. A legal document registered at and issued by the LPI as proof of ownership of property.
Title documents
The set of legal documents (including a title deed) which evidence legal ownership of a property.
Title search
A title search details the names of the owners of a property and other information such as encumbrances, covenants and caveats.
Torrens Title
A system of recording property ownership where registration on the Certificate of Title guarantees ownership. This is managed by Land & Property Information.
Townhouse
A housing unit, with two or more floors and attached to other similar units via common party walls.
Transfer (Transferring)
Moving interests in a property between people. It may involve adding or removing one or more person's name from a property.
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V

Vacant Land
Vacant land on which a dwelling has not been constructed.
Valuation
An assessment of the value of a property given in a written report by a registered valuer.
Valuer
A licensed person who determines the value of a property using established valuation methodology.
Vendor
The seller.
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Z

Zoning Certificate
A certificate issued by a local council disclosing the nature of the zoning of a property and any adverse affectations recorded in the Council's records with respect to the property.
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