What Happens on Settlement Day in Australia: A Buyer’s Guide

Settlement day is the moment everything comes together. After weeks of contract reviews, finance approvals, and conveyancing searches, settlement day is when the property officially becomes yours. But what actually happens on the day? Who does what? And what can go wrong? This guide walks you through every detail of settlement day in Australia — from the pre-settlement inspection through to collecting the keys — so you know exactly what to expect.

The Pre-Settlement Inspection

Before settlement takes place, the buyer is entitled to a final inspection of the property. This typically happens within the last 7 days before settlement, and sometimes on the morning of settlement day itself. The purpose is to confirm that:

• The property is in substantially the same condition as when you exchanged contracts
• All inclusions listed in the contract are present and in working order (e.g., appliances, light fixtures, curtains, blinds)
• The vendor has not caused any damage since exchange
• The property has been vacated and left in a reasonably clean state
• Any agreed repairs have been completed

What Your Conveyancer Does on Settlement Day

As the buyer, your direct involvement on settlement day is minimal. The heavy lifting is done by your conveyancer (or solicitor) and your lender. Here is what happens behind the scenes:

Electronic Settlement via PEXA

In most Australian states, property settlement is now conducted electronically through PEXA (Property Exchange Australia). PEXA is a digital platform that connects conveyancers, lenders, and state land registries to complete settlements in real time. This replaced the old paper-based system where parties physically gathered around a table to exchange cheques and documents.

With PEXA, the following happens digitally and simultaneously:

• Fund transfers: The buyer's lender sends the loan amount, and the buyer's own funds (any shortfall beyond the loan) are transferred through PEXA to the vendor's account
• Mortgage discharge: The vendor's existing mortgage (if any) is discharged electronically — the vendor's bank receives the payout and releases the title
• New mortgage registration: The buyer's new mortgage is registered against the title simultaneously
• Title transfer: The transfer of ownership is lodged electronically with the state's land titles office (e.g., NSW Land Registry Services, Land Use Victoria, Titles Queensland)
• Stamp duty payment: Stamp duty is paid to the state revenue office as part of the settlement

The entire PEXA settlement typically takes just minutes once all parties confirm they are ready. Your conveyancer will notify you as soon as settlement is complete — usually by phone call, text, or email.

Getting the Keys

Once your conveyancer confirms that settlement is complete, the property is legally yours. Key collection arrangements vary:

• Most commonly, the real estate agent holds the keys and releases them to you once they receive confirmation of settlement from the vendor's conveyancer
• In some cases, your conveyancer may arrange for keys to be collected from their office or the vendor's solicitor's office
• If the property is tenanted, the existing tenant remains and you receive the keys from the property manager at the end of the tenancy

Settlement usually happens between 10am and 2pm, so you can typically collect your keys on the same day. Plan accordingly — you may not get access to the property until the afternoon.

What Can Go Wrong on Settlement Day

While the vast majority of settlements proceed without issues, delays and complications can occur:

Delayed Settlement

The most common problem is one party not being ready on the agreed date. Common causes include:

• Lender delays: The buyer's bank may not have the loan funds or documents ready in time. This is the single most common cause of settlement delays.
• Chain delays: If the vendor is simultaneously buying another property, a delay in their purchase can cascade to your settlement.
• Missing documents: Unsigned forms, incomplete identification verification, or missing mortgage discharge documents can hold up the process.
• PEXA technical issues: Rare, but platform outages or technical glitches can delay electronic settlement.

Pre-Settlement Inspection Issues

If your final inspection reveals problems — damage since exchange, missing inclusions, or undisclosed changes — your conveyancer can negotiate remedies before settlement proceeds. Options include a price reduction, a holdback of funds in trust, or requiring the vendor to rectify the issue before you settle.

What to Do After Settlement

Once settlement is complete and you have the keys, there are several practical steps to take care of:

• Utilities: Transfer electricity, gas, water, and internet into your name. Contact each provider to set up new accounts from the settlement date.
• Building insurance: Confirm your building insurance policy is active from settlement day. If you arranged cover from exchange (as required in some states), contact your insurer to confirm the policy details now that settlement is complete.
• Council notification: Your conveyancer will notify the local council of the change of ownership, but you should confirm this has been done so future rate notices come to you.
• Change of address: Update your address with Australia Post, your bank, employer, Medicare, the ATO, and other relevant parties.
• Locks: Consider changing the locks on the property. You do not know how many copies of the keys exist from the previous owner.
• Strata/body corporate: If the property is part of a strata scheme, register as the new owner with the body corporate or strata manager.
• Keep your documents: Store your contract of sale, settlement statement, and loan documents securely. You will need them for tax purposes and when you eventually sell.

Settlement Day Checklist

For a comprehensive preparation guide, see our property due diligence checklist.

For a detailed overview of the entire timeline from exchange to settlement, see our complete guide to the settlement process.