What is Section 32 Vendor Statement?

Whether you proceed to buy a property or sell one, there can be multiple inhibitions storming your mind. Is the property as great as it looks? Does it have a mortgage? Are there any other kinds of financial liabilities with the place? Is the buyer genuine? Will they back off after some time? These can be a few questions that will keep emerging in your mind. However, here in Australia, there is a legal document that promises a stress-free real estate transaction. We are talking about Section 32, a legal document the seller gives to the buyer during the course of real estate sale and purchase.

In this detailed blog, we will learn more about Section 32, the key terms used in the document, and how it can benefit you. So, let’s dive in

What is Section 32?

The Section 32 statement is pivotal to a property deal. It’s a legal paper handed over by the seller to the potential buyer, and it gets its name from a law called Section 32 of the Sale of Land Act of Victoria (1962).

So, before you sign the Contract of Sale, the law says the seller must inform everything about the property to the buyer. If they don’t, you, as the buyer, have the advantage of backing out from the deal at any time, and the law stands with the buyer.

What does the Section 32 document vendor statement comprise? Before diving into the contents, let’s understand that Section 32 isn’t just one document. Instead, it’s a compilation of documents the buyer will need to know about the property. Below is all that it covers:

  • Details of the Vendor
  • Legal papers that prove the ownership of the place
  • Renovations or upgrades that got sanctioned during the last years
  • Owner-builder warranty insurance
  • Mortgages or any other debts tied to the property
  • Covenants, easements, and restrictions, i.e., rules about what you can and can’t do with the property
  • Zoning details that can affect how you use the land.
  • Bills and fees that the property owner needs to pay
  • Any official alerts about the property, like road stuff, sewerage, etc
  • Answer to whether the property is accessible by road
  • Services such as water, electricity and other essentials connected to the property
  • Owners’ corporation certificate if the property is an apartment,

Who is a Vendor?

Understanding the term “vendor” is crucial when you seek information on Section 32 real estate. In real estate, a vendor is the seller, i.e., the individual seeking to transfer the property to a new owner.

What is a Vendor Statement?

A Vendor Statement, often synonymous with Section 32 Vendor Statement, is more than just paperwork; it’s a legal document mandated by the Sale of Land Act of Victoria. This document serves as a transparent disclosure of vital information about the property, acting as a foundation for a fair and informed transaction.

What is the Purpose of Section 32 in Real Estate?

Section 32 of the vendor statement holds immense importance for both the buyer and seller.
For the seller, providing Section 32 isn’t just a legal must. Rather, it’s also an assurance to the buyer about the righteousness of the property. It serves as a promise to the buyer. Therefore, when you make one that has all the adequate details, it helps to lock in the buyer and lets you keep the entire deposit if they change their mind after the cooling-off period.

For buyers, Section 32 is your key asset against any impending issues with the property. Through the document, you get a hold of all the details about the property you intend to purchase. These include the property’s condition, potential risks, and any other crucial information that might influence their decision to purchase.
The provided information helps you make smart decisions about the property. Moreover, it’s like a legal shield for both parties, making sure everyone’s on the same page.

When you get a conveyancer Melbourne to review Section 32, you will avoid any lurking surprises about the property, making the deal stress-free.

Importance of Section 32 Vendor Statement

As a seller, Section 32 is more than just a checkbox—it’s a must-do when you intend to sell your property. If you don’t give the buyer the right info in the Section 32 Vendor Statement, your whole sale could be at risk. For buyers, Section 32 is like your information hotline. It comprises details that can seriously affect how you decide to buy a property. The document holds immense power in shaping your choices.

Who Prepares Section 32?

Given how crucial the Section 32 vendor statement is and the legal outcomes it can bring, it’s advisable you get the assistance of a conveyancer to prepare it. If the statement turns out to have problems, it could seriously impact the sale, and the buyer might even have the right to back out. That’s why it’s a good idea to involve a professional early on.

Lawyers and conveyancer in Sydney or Melbourne can help you to deal with Section 32 vendor statements regularly, so they know the ins and outs. They can create an elaborate and accurate document without taking up too much time. Moreover, having a lawyer by your side ensures that you understand your responsibilities as a seller and can do the right during the property transactions.

What to Look for in Section 32?

As a purchase, you must ensure that you have your conveyancer by your side when reviewing the document for Section 32 of the Sale of Land Act. They can guide you on things that might impact the property’s value or need more investigation.

When reviewing Section 32, keep an eye out for crucial details that can significantly impact your decision about a property. Here’s a checklist to guide you:

  • Make sure the contact information and particulars of the seller are accurate.
  • Confirm that the seller legally owns the property and has the authority to sell it.
  • Check for any debts or liabilities associated with the property, listed in order of priority.
  • Understand any limitations on how the land can be used, like building guidelines or public thoroughfares.
  • If the property was built recently, ensure that the owner-builder warranty insurance is provided.
  • Learn about the permitted uses of the property, whether residential or commercial.
  • Find details about any financial obligations related to the property, such as rates.
  • If it’s an apartment or unit, this certificate reveals the state of the body corporate, including fees, charges, and any restrictions.

What Should a Buyer & Seller Be Looking For?

As a buyer, you must scrutinise the Section 32 document and ensure that you look into every minute detail. It will help you know the property well before paying your hard-earned money.

Meanwhile, if you are a seller, ensure 100% transparency and accuracy when drafting Section 32 for real estate transactions. Ensure that you have all the documents needed to make the buyer know more about the place and place their trust in you.

Does a Vendor Need the Services of Conveyancers?

It’s a safe move by the sellers to have a conveyancer onboard while drafting the Section 32 Vendor Statement. It ensures that the document comprises all the papers required to prove the righteousness of the property and keeps both the seller and the buyer protected.

What If the Vendor Statement Is Not Correct?

Inaccuracies in Section 32 can lead to serious consequences. Sellers must provide accurate information, as intentional misinformation can result in legal issues and civil claims. Transparency and honesty are paramount in this process.

How Much Does a Section 32 Cost?

The cost of preparing a Section 32 Vendor Statement can vary. It is an investment in ensuring a smooth property transaction and legal compliance. Sellers should view it as a crucial step in facilitating a fair and transparent sale.

How Long Does Section 32 Remain Valid?

One cannot determine the exact validity period of the Section 32 Statements. There are two main things in the document. These are:

  • Attach all the necessary documents
  • Ensure transparency and accuracy

When making a Section 32 Statement, practitioners and sellers often use certificates to provide proof of what they are stating regarding the place. After around 90 days, these certificates might become invalid, but it’s not a strict rule. It’s because even if the seller prepares the Section 32 statement a day before, it could expire if there’s new info before the buyer signs the contract.

If there’s missing or wrong information, and the new details put the buyer in a much worse situation, they can cancel the contract. Even if the seller was honest and fair, the changed rule gives the buyer the right to cancel the deal at any time.

After Process – When Section 32 Statement Has Been Reviewed

Once the buyer’s legal representative reviews Section 32, the buyer gets to have an in-depth understanding of the property they wish to invest in. They can then figure out if they want changes in the contract or if they are satisfied with the Section 32 statements and are ready to throw in an offer.

Other Documents Required When Buying a Property

The Section 32 statements are a compilation of various documents such as the zoning certificate, title deed, outgoings, building permits, owners corporation certificate and many more. If you have an interest in a property, it’s advisable to brace yourselves with the basics of these documents. It will make comprehending the Section 32 Vendore Statement easy.

FAQs

How long does it take to get a Section 32?
The time to prepare a Section 32 varies based on the property and required reports. Early preparation is advisable to prevent delays and ensure a timely sale process.

Is a vendor statement the same as a Section 32?
Yes, the terms “vendor statement” and “Section 32” are often used interchangeably, both referring to the crucial document providing details about a property. However, vendor statement is the umbrella term covering all the critical documents in the Section 32 statement.

Can a power of attorney sign a Section 32?
Yes, a power of attorney can sign a Section 32 on behalf of the seller, adding a layer of flexibility in the transaction process.

Can an agent sign Section 32?
In some cases, real estate agents may sign Section 32 as proof of providing the statement, but it’s recommended that the seller’s signature is also present for added authenticity and accountability.

Easy Link Conveyancing is a team of seasoned professionals with ample experience in residential and commercial property dealings. We offer comprehensive and tailored services that help you transact the property while keeping your best interests. Our conveyancers simplify property transactions for you, providing guidance and expertise at every step. Rest assured, with us, you’re in capable and trustworthy hands throughout your property journey.

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