Electronic ""Virtual"" Conveyancing - Ending The Monopoly?
All Victorian transfers of land settling on or after 1 October 2018 (with limited exceptions) must be conducted by way of electronic (virtual) conveyancing, currently on electronic workspaces using the Property Exchange (“PEXA”) network.
Settlement funds for purchasers are made available through the PEXA network either by your mortgagee (if you have one) and/or by you transferring funds into the PEXA Source Account (if you are purchasing without a mortgagee or if your mortgagee does not have access to a shortfall account).
Settlement funds for vendors are made available through the PEXA network either via your outgoing mortgagee into a nominated surplus funds account (if you have one) and/or by transferring funds into your nominated bank account.
There have been security concerns about the PEXA platform – which arose following a “hack” via a member conveyancers e-mail that allowed for access to the PEXA system and settlement funds from a transaction to be siphoned to an unrelated account – and also its ability to cope with the volume of transactions after the switch.
There have also been competition concerns raised about the current “monopoly”, with other new providers now looking to enter the field. Currently, the only registered Electronic Lodgment Network Operator (“ELNO”) provider is PEXA. PEXA is owned mainly by the major state governments and various banks.
The paper process is “like the dark ages”, but the biggest concern with e-Settlements comes when faced with a problem that only the electronic provider can assist with. When things go wrong, it can take up to 30-45 minutes to speak to someone on the phone. Providing competition should have a positive influence on wait times and responses.
If you would like further details or assistance or to discuss information contained in this article or more generally, please do not hesitate to contact us at Held Lawyers.
This article is intended to provide commentary and general information only. It should not be relied upon as legal advice. It is not intended to be a complete or definitive statement of the law on the subject matter covered. Further professional advice should be sought before any action is taken in relation to the matters described.