Your home loan settlement made simple: 3 steps to prepare

couple signing their home loan contract

Once your home loan is approved and you’ve signed the contract of sale, all that’s left to do is settle. A quick job for your solicitor, right? Not quite.

Property settlement is a legal process of transferring the ownership of the property from the seller to you - we look into the process in a bit more depth.

How long does settlement take and what does it mean? 

It typically takes anywhere between 45 to 90 days, but it could be longer if you and the seller agree on a different timeframe. 

As the name suggests, home loan settlement means that on the agreed date, the sale is complete, and all details have been finalised (or “settled”). Your lender will transfer funds to the vendor to pay for the loan balance, your solicitor or conveyancer will register the property in your name, and you’ll be able to pick up the keys to your new house.

What are the stages ahead of settling your home loan? 

Understanding the stages that lead up to your home loan settlement could help you navigate the process a bit more smoothly.

1. Final inspection

Also known as the pre-settlement inspection, this is your last chance to look around the property and make sure everything is as expected. While you may be more excited about what colour you’ll paint the walls, it’s important to check the following:

  • The home is in the agreed-upon condition
  • All appliances and fittings are working (as agreed)
  • No significant damage has occurred since your last inspection

Any issues identified in the final inspection can delay your home loan settlement. And while you want to avoid that, it’s important to check and report any unexpected damage to have it fixed before finalising the purchase. Afterall, it’s not just pocket change you’re playing with!

2. Settlement adjustment statement

Before the official settlement, your conveyancer or solicitor will provide you with a settlement adjustment statement. This document acts as a balance sheet of any remaining costs. The costs could include:

  • Stamp duty and any related concessions
  • First Homeowner Grant (if applicable)
  • Any adjustments for council rates, water, and body corporate fees already paid for by the seller.

If you don’t have enough funds to cover the total sum, your settlement will be delayed. So it’s important to factor in these additional costs before you sign. It could be a good idea to have your deposit ready a few days before settlement to ensure there are no unexpected surprises.

3. Final settlement – the day you get the keys

The day you’ve been waiting for – so get that Champagne on ice!

This is the day that solicitors and conveyancers exchange the final payment and transfer documents, so the transfer of ownership can be officially registered. It’s also the day you can pick up the keys and invite your friends over to celebrate.

It’s worth noting that even basic paperwork issues at this stage could still delay settlement. To help avoid this, check the details carefully and make sure you’ve signed everywhere you need to before returning the documents to your lender on time. Many lenders also ask for your home insurance details at this stage, so organise that in advance too.

Of course, some delays are completely out of your control – there could be an administrative error, or complications with the seller such as tenants not moving out on time. So, it’s a good idea to have a backup plan just in case you can’t get into your new home on time.

Finally take a moment to soak it in. Settlement is a fantastic feeling, and after all the financial and emotional effort you’ve put into buying a house, you deserve to enjoy it.

We’re here to help.

If you’d like to learn more about Pepper Money home loans settlement process, contact one of our friendly Lending Specialists on 137 377 or chat to one of our accredited Brokers. Alternatively, enquire online and we’ll get right back to you.

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