Electronic Conveyancing is here. For some time, electronic conveyancing has been talked about as coming but life went on without it. Up until now, buying and selling property started online with lots of online tools for searching records, downloading documents, performing calculations etc., but up until very recently that process was completed (or settled) manually.
The manual settlement process required various parties to meet in one place, each contributing something to the settlement manually and each taking something away manually. Where money was involved, the handover was by way of bank cheques. Where documentation was involved, the documents had to be in “registrable form”. As you would expect, there were inevitable errors, which then resulted in delays to settlement; in fact 20% of all settlements were delayed to some extent.
Property Exchange Australia (PEXA) is a platform for e-conveyancing and is a collaboration between financial institutions, land registries and the Reserve Bank of Australia. It connects all participants to a transaction in a virtual space and allows the settlement to happen electronically. Of course, integrity of the network is crucial and the Australian Registrar’s National Electronic Conveyancing Council (ARNECC) has developed a framework to deal with participation agreements, digital certificates and verification of identity.
There are several significant advantages in using the PEXA platform:
a) It removes the need for physical signatures,
b) It removes the need for the physical attendance of any party,
c) It removes the duplication of effort across the parties within their own systems,
d) It increases the transparency of the process so that each party has access to real time updates from the other parties, and therefore greater certainty of settlement,
e) It will reduce the number of settlement failures,
f) Funds are distributed immediately as cleared funds,
g) Title is registered instantly therefore reducing the window for “registration gap” events.
PEXA will continue to grow in strength and momentum as:
a) more and more transaction types are included in the electronic process, and
b) more and more conveyancers become registered as PEXA participants. It is inevitable that all must ultimately follow suit.
All About Conveyancing are registered PEXA participants and PEXA is the platform of choice for all of our settlements. Got a conveyancing question, then talk to us.