When you’re going through the process of buying a house, you’ll need the legal services of a professional who can help you with the property transfer.
Both lawyers and conveyancers are the right people for the job as they’ll help in preparing the documentation required for property settlement.
People often use both terms interchangeably, but a lawyer is different from a conveyancer. It’s not always easy to distinguish between the services offered by them, but we’ve compiled the differences for you.
What are the differences between a Lawyer and Conveyancer?
- Scope Of Operation
- What does a conveyancer do?
- What does a Lawyer do?
- Fees and costs
- How much does a lawyer charge:
- How much does a conveyancer charge:
- Which one Should You Hire?
- What are the laws regarding conveyancing?
- What are the laws in Queensland?
- What about the other Australian States?
- Bonus: Other things to consider
- Bonus: Can I do the work of a conveyancer myself?
- Summary – the main differences are?
- Next steps from here to buy your first home
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 carry out legal work related to a real estate transaction.
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
They 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, and they will inform you of your legal obligations when entering into the contract, as well as draft conditions which will hold up in the 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. They also analyze 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 – 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 all other related stakeholders. A great conveyancer will take the time to talk to you and explain things to you every step of the way.
Conveyancers can work in any state. However, each state has a different requirement and a different set of rules, so it’s always best to go with someone local as this will speed up the process and help you navigate the local market with local issues known to the conveyancer.
We recommend the following conveyancers in Brisbane and Queensland:
What does a Lawyer do?
A Lawyer, also called a solicitor, is a licensed legal practitioner whose knowledge is general and broad in nature.
A lawyer must hold a bachelor’s degree in law and still be practising their legal profession. A lawyer can choose an area to specialise in. Different lawyers choose different areas of practice, for example, a bankruptcy lawyer specialises in bankruptcy cases, criminal lawyers deal with crimes and so on.
All in all, a lawyer can specialise in different capacities and they can also operate in any state.
A lawyer does similar things to a conveyancer – and sometimes more – but they are slightly more expensive.
Fees and costs
How much does a lawyer charge:
Lawyers usually charge an hourly rate and they are typically more expensive than a conveyancer.
How much does a conveyancer charge:
The cost of a conveyancer ranges from conveyancer to conveyancer. Typically, the cost is between $500-$2,500. On top of this charge is the cost of 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.
Which one should you hire?
When it comes to choosing between a lawyer and conveyancer for a real estate transaction, keep your budget in mind. As mentioned above, lawyers are slightly more expensive than conveyancers.
The main reason people hire a conveyancer is that 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 keep in mind that the lower price of the conveyancer means they may offer you less time. So, you may not get the same level of service as you would from a lawyer.
In addition to that, the size and complexity of the transaction also matter, along with the 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 then refer you to a lawyer. This means you’ll have to pay extra and it may end up being more costly.
So, look at your situation and, factoring in the pros and cons of each, 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, jargon, 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 compared to conveyancing firms and have greater penalties in case of non-compliance.
What are the laws in Queensland?
Unlike other states, in Queensland, it is not legal for a licensed conveyancer to have their own firm. In fact, all the conveyancing work is managed and executed by a law firm. There are a number of law firms in Queensland that have started a specific conveyancing sector which is still part of their law firms and treated as such. These firms are required to 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 standardized 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 having to wait days for a conveyancer to review it.
What about the other Australian states?
In most 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.
It is important to understand, however, that he or she cannot give any advice that is not related to conveyancing.
Bonus: Other things to consider
Before hiring a legal professional, the following are certain things to keep 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.
- A reasonable price will have to be paid in order to hire the services of a reliable professional. Professionals earn their reputation through years of experience in the market and do not offer any incentives or tempting offers to hire a client.
- Similarly, be careful about giveaways. A fairly new firm tries to attract people by offering giveaways, but the quality of service is what is crucial to the successful execution of property transactions.
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?
Whilst there are DIY conveyancing kits online which range between $50-$200. We don’t recommend this if you are a first home buyer or you are 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 really an insurance to guard against buying the wrong property with unseen issues. These issues can vary from properties not having the right counsel approvals, caveats, and even having rates in arrears, which can have possible disastrous consequences.
We cannot stress this enough, don’t go at it alone. 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.
Summary – the main differences are?
Specific to property only
Hourly – more expensive
Fixed – cheaper
Type of property transaction
Lawyers have a general knowledge in all legal aspects while conveyancers are specialised to 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.
Give us a call on 1300 088 065 or book a free assessment online to see how we can help.