If you have ever reached the final stages of a property transaction and noticed the balance due doesn't perfectly match your contract price, you’ve met the Statement of Adjustments. Far from being a hidden fee, adjustments are the essential financial handshake that ensures both the buyer and seller pay only for the exact days they own the property.
At Shepparton Conveyancing Services, we believe in making conveyancing easy through total transparency. Here is a detailed look at why these figures change and how we protect your interests during a Victorian settlement.
In Victoria, property-related expenses like council rates and water charges are often billed annually or quarterly. Because settlement can happen at any time during these cycles, it is rare for a bill to align perfectly with the day you take the keys.
Adjustments act as a final reconciliation.If a seller has already paid a bill for the whole year, the buyer reimburses them for the portion representing the time the buyer will own the home (a plus adjustment). Conversely, if a bill is owing for the time the seller lived there, the amount is deducted from the sale price (a less adjustment).
Our team meticulously calculates these figures to the cent, focusing on several key Victorian outgoings:
- Council Rates: Most Victorian councils operate on a financial year (1 July to 30 June). We divide the annual rate by 365 days to find the daily cost. If you settle on day 200 of the year and the seller has paid in full, you will reimburse them for the remaining 165 days.
- Water and Sewerage: These involve two types of charges: fixed service fees and variable usage. We often order a Special Meter Reading just before settlement to ensure the seller pays for every drop of water used until the moment of transfer, so you don't start your new life paying for someone else’s usage.
- Owners Corporation (Strata) Fees: If you’re buying a unit or apartment in Shepparton or elsewhere in Victoria, body corporate levies are adjusted similarly. We ensure any Special Levies for major building repairs are disclosed and paid by the correct party based on when they were struck.
- Land Tax: This is a critical area for Victorian buyers. We stay up to date with the latest legislation to ensure that land tax is only adjusted when legally permissible, protecting you from carrying a burden that belongs to the vendor.
Calculating adjustments isn't just about math; it's about legal protection. Without accurate adjustments, you could inherit the previous owner's debts. At Shepparton Conveyancing Services, we:
- Order Fresh Certificates: We don't rely on old data. We pull current Land Information and Water Statements to ensure every dollar is accounted for.
- Clear the Title: If the seller has a mortgage, we ensure the fee to Discharge that mortgage is handled correctly, so you receive a clean title.
- Provide Clarity: We provide you with the final Statement of Adjustments well before settlement so you have time to ask questions.
A common mistake is thinking the Balance Due is just the purchase price minus your deposit. In reality, it’s a living figure. Budgeting for a buffer to cover these adjustments ensures your settlement day is a celebration, not a stressful financial surprise.
Don’t let the math of settlement overwhelm you. With 30 years of industry experience, we attend to your needs with personable service that makes efficient and easy conveyancing a reality.
Would you like us to review your Contract of Sale or prepare your Statement of Adjustments? Contact the team at Shepparton Conveyancing Services today.