Merely a suggestion in the idea of improving/simplify the balancing of the Financial Settlement Statement (FSS)
Why not treat the Buyer/Incoming Proprietor (IP) source of funds as an fluid (automatically calculated/tallied) 'Bucket'.
Specifically;
The Available Funds (AF) Bucket figure/amount (If multiple sources apply then think of if as one bucket or Source of money, simply filled by various contributors. ie Lender, Subscriber Trust account, PEXA source account. -some of these might set a minimum draw down or some might allow for refund to Buyer nominated account)
AFAIK most jurisdictions would have Subscribers/Practitioners do a balance of rate and outgoings adjustment and then agree on the Balance required To Settle (BTS) Bucket.
From this AF Bucket the IP subscriber would draw their fees; pay the buyers outgoings and the agreed BTS bucket to the Seller
The Buyer would usually add their fees & outgoings to the BTS This should then equal the Buyers AF or allow for refund to/additional contribution from the buyer.
Currently This Seller BTS would then be agreed and requested Outside of PEXA (Away from the FSS: why not have the seller and buyer propose and vary the BTS amount within FSS) where currently only Split Directions (SD) end up as listed as line items in the destination of FSS.
Currently the Buyer side does not usually get to see the AF and has to ask &/or source additional funds to the AF.
If you used 'Settlement Room' the Buyer Subscriber would see the AF from the Banks and add additional sources early in the settlement. The Destinations were loaded by responsible party. Each party were able to easily balance their tally/Bucket of funds.
Then we could also treat the Seller Outgoing Proprietor (OP) destination (Sale Proceeds) funds as a bucket also.
Out of the BTS the Seller Acting subscriber would normally instruct the SD as follows amounts;
The amount to go to themselves
The amount to the Listing Agent along with any other authorised payments, usually by Account details
Then usually the Balance of Proceeds goes to either;
- A) Discharging Lender where applicable -would have a minimum payout amount which they need to instruct for them Required to settle, but most often they can accept Full Net Proceeds(FNP) surplus funds as they may have an authority to bank surplus funds on behalf of the Seller- Since this amount often seems to be loaded as (static) line destination- it remains in fluid to any changes this ideally should automatically update where the Seller Lender &/or
- B) Seller nominated Account or
- C) Subscriber:- is to collect FNP (Bucket) to disburse as instructed.
Suggest a fluid (automatic update) figure is used, where Full Net Proceeds (tick box) figure is possible.
I guess my point is each participant subscriber &/lender needs to balance to their own figures. But they need to know which Bucket they need to balance too...
It would be handy if those buckets (at least certain line items) could tally/auto level themselves...
But it seems that some are not understanding which bucket to use and simply making the source & destination balance merely to settle.
