Conveyancer does not have a trust account

Is it normal for a NSW conveyancer to not have a trust account to which a purchaser can electronically transfer a final balance owing at settlement?

We recently purchased in SA and everything was very straightforward. Near the end of the settlement process our conveyancer provided a statement (stamp duty, money still owning to vendor, and adjustments for rates, etc... and the conveyancer fee itself). We just transferred one lump sum to the conveyancer's trust account. Easy.

Now we buy in NSW which settles in a few days and the conveyancer has no such trust account. Is this normal? We are told we must get a bank cheque for the OSR to cover stamp duty, and we must get a second bank cheque for the vendor, and we must settle the conveyancer fees separately (the conveyancer's bill can be paid electronically).

It might sound like a minor inconvenience but it's far from it. First we have to transfer funds from an equity loan at Bank A (a bank without any branches), to a personal account at Bank B (of which the nearest physical branch is a 90 minute drive away)... so allowing up to 3 days for the transfer to happen so I can then drive to the bank, get the bank cheques drawn, physically take them to the conveyancer, etc.. and of course, conveyancer at this stage still cannot even confirm the exact amount owing to the vendor so I've had to guestimate the transfer value from A to B so to ensure the funds will be there and ready.

I mean... is this "normal" in NSW ???

I'll definitely be putting it on my list of things to ask my next conveyancer before appointing them: DO YOU HAVE A TRUST ACCOUNT ???
 
NSW is one of the states I haven't bought in, but yea, SA is very straight forward and simple to purchase in.

But I thought a trust account was mandatory for any organisation dealing with property and accepting money from people?

A quick Google pulled up this reference which might help? http://www.fairtrading.nsw.gov.au/f...ng/Trust_accounts_and_audit_requirements.page

Good point, but perhaps by requesting their clients to provide separate bank cheques already drawn directly to the Vendor and the Office of State Revenue, they technically aren't holding money on their behalf, therefore they don't need a trust account?

The company concerned is a pretty large, well-established conveyancing company in the Lake Macquarie area... not some tin-pot backyard operator.
 
Most conveyancers don't have a trust account in my experience, most solicitors do however (just a general observation). Your first conveyancer may have been operating out of a solicitors office? A conveyancers role doesn't necessarily mean they have to hold money on a clients behalf.

A trust account isn't usually necessary. If you've got an account with the lender they can almost always debit the settlement funds directly from that account (this is the most common method these days).

Often the lenders solicitor will have a trust account which can be used if necessary.

The old fashion way was to get a bank cheque to your conveyancer made out to the lender, they then present this at settlement. Not as common these days but it still happens. Obviously not so practical for interstate purchases.

In all cases, you should expect a "disbursements" letter from your conveyancer.

I guess I'm saying there's plenty of practical solutions to the problem. I wouldn't choose a conveyancer on the basis of a trust account.
 
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There is no requirement for a lawyer to have a trust account. I don't have one because of the risks involved and the high auditing fees. However most lawyers who do a lot of conveyancing probably would have.
 
Most conveyancers don't have a trust account in my experience, most solicitors do however. Your first conveyancer may have been operating out of a solicitors office?

It's usually not necessary though. If you've got an account with the lender they can almost always debit the settlement funds directly from that account (this is the most common method these days).

Often the lenders solicitor will have a trust account which can be used if necessary.

The old fashion way was to get a bank cheque to your conveyancer made out to the lender, they then present this at settlement. Not as common these days but it still happens. Obviously not so practical for interstate purchases.

I guess I'm saying there's plenty of practical solutions to the problem. I wouldn't choose a conveyancer on the basis of a trust account.

Thanks for the advice. You are right, the SA one operated out of a solicitors office.

Unfortunately we don't have another account with the lender (let's call them "Bank C"). We have an equity loan to cover these purchasing costs and balance of purchase over at "Bank A".

I didn't realise until later that Bank C's solicitor also offer a conveyancing service. In hindsight this may have been a simpler option.
 
There is no requirement for a lawyer to have a trust account. I don't have one because of the risks involved and the high auditing fees. However most lawyers who do a lot of conveyancing probably would have.

I do have a trust account. We use A4 cheques that our software populates from requests made by my solicitors. I sign 30 chqs most days.

The accounting and complying with regs takes 2-3 hours every day plus an extra hour or 2 a week then an extra hour or 2 a month. On top of that a couple of days of audits a year.

Painful so can see why you would not have one if you did not have to
 
Although the solicitor can be used as the deposit holder I have only done it this way a couple of times - god knows that you can't trust those REA's ;).

Compliance and annual audits are a requirement of OFT. They have also tightened up on trust accounts lately.
 
The conveyancer that I used had a trust account - I felt much more confident with my legal representative holding the $$ than a REA. All went well and no hassles at all. I found when I was looking for a conveyancer, it was rare for their organisations to have one thou. I'm in Sydney NSW

cheers
 
I have heard of the buyer and vendor opening up a joint double signature account where the buyer puts the 10% in and the .25 was paid in cash at the conveyancers office and signed of that way. When the 10% was due to be paid out both parties go to the bank and sign the money over to whom ever the seller specified. PIA but it's done more often than you know.

T.G
 
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