Net amount available on settlement

[Clara]

I wish all incoming banks advise the net amount available at least 5 days before the scheduled settlement so we will know in advance if we will require the incoming proprietor to deposit into the PEXA account ahead of the 3 days requirement for funds to be available in the account.  It worries me if clients are not able to make the deposit on time and settlement cannot proceed due to this.  I do not operate a trust account.

[Kate_Camilleri · Accepted solution]

Hi Clara,

Thanks for your post, we understand how arranging shortfall (purchaser’s equity) close to settlement causes anxiety and risks delays. To address this, new functionality in PEXA Release 7.1 allows the Incoming Proprietor to enter the “Total Funds Required to Settle” and the Incoming Mortgagee to advise if they hold authority to provide shortfall. Industry Guidelines for when these fields should be completed are currently being drafted with the sole purpose of reducing the anxiety around this step by having this information provided as far in advance of settlement as possible. Please keep an eye out for community posts relating to these guidelines changes and come back to me if you have any further questions.

Regards, 

Kate. 

[Karla · Accepted solution]

Hi all,

The feature of us entering "funds required for settlement" doesn't really fix the issue of the banks not even advising us of funds available until last minute.

Why can't the bank's still issue paper confirmation of the nett funds available, and breakdown of what is being paid out of the loan?

We're lucky if they advise 3-5 days before settlement funds available, let alone what fees etc are being paid out i.e. we had loan approval of $500,000.00 but our client was paying LMI of $25,000.00. We never really know that unless our clients bring it to our attention.

If the bank's still issued a confirmation of funds available letter, then they could say loan amount $500,000.00 less LMI of $25,000.00 less fees of $1500.00 so then we know we would be working with $473,500.00. It's a bit embarrassing when you are short $25,000.00. 

PEXA still has a long way to go before this is all going to be pain free!! We constantly have to hound the bank for funds available.