The Enhanced Settlement Summary tab has been redesigned to reduce friction so that you can experience a simpler, more streamlined way to completing the financial settlement schedule.
As part of the redesign, you’ll notice a revamped interface that includes new features and panels. We have also introduced some calculations enabling practitioners and financial institutions to easily enter funds and complete the financial settlement schedule with more accuracy and less dependency.
Key summary of changes
A complete view of settlement funds
One of the notable improvements in the Enhanced Settlement Summary tab is the way the funds are displayed and laid out. There is a clear, side-by-side categorisation and itemised view of funds for both the incoming and outgoing parties, which replicates a balance sheet.
The Enhanced Settlement Summary gives you a complete picture of the purchaser’s and vendor’s funds, all on a single screen. The specific breakdown of funds in each category for each party gives everyone in the Workspace greater transparency on the settlement funds.
Information that is specific to your role will be automatically expanded, whilst items that belong to the other party will be automatically collapsed. To view or hide the itemised funds, you can expand or collapse the panels.
New Transfer Indicators panel
A new Transfer Indicators panel provides a summary view of all key tasks that relate to the financial settlement in the Workspace, giving you greater transparency over key responsibilities for Workspace parties.
The two new features in this panel include the ability to:
- View who will be directing the vendor’s surplus funds. Either the Proprietor on Title or Mortgagee on Title can assign responsibility for this task to themselves.
- View if the Balance due to Vendor* amount has been agreed by participants in the role of Incoming Proprietor and Proprietor on Title.
* Note: In this release notes, we’re referencing this amount as the ‘Balance due to Vendor’; however, the terminology differs in each jurisdiction:
- NSW—Amount due on Settlement
- VIC—Balance due to Vendor
- QLD—Balance due to Vendor
- SA—Balance due to Vendor by Purchaser
- WA—Balance due to effect Settlement
- ACT—Amount due to Seller
Balance due to Vendor
New to the Enhanced Settlement Summary tab is the mandatory Balance due to Vendor* amount. This is calculated by the purchase price, minus deposit paid, plus/minus net adjustments.
This figure is agreed by both the Proprietor on Title and Incoming Proprietor outside of the PEXA Workspace.
Either participant will have the ability to enter this amount into the PEXA Workspace. Providing the Balance due to Vendor into the Workspace provides PEXA the ability to:
- Clearly indicate to all participants the amount of funds available for the Vendor to disburse, and
- Use this figure to drive the Purchaser Funds Required to Settlement calculation (previously the Total Funds Required to Settle).
* Note: In this release notes, we’re referencing this amount as the ‘Balance due to Vendor’; however, the terminology differs in each jurisdiction:
- NSW—Amount due on Settlement
- ACT—Amount due to Seller
- VIC—Balance due to Vendor
- QLD—Balance due to Vendor
- SA—Balance due to Vendor by Purchaser
- WA—Balance due to effect Settlement
System calculations
As part of the Enhanced Settlement Summary, PEXA will calculate the vendor’s surplus, purchaser’s shortfall, and purchaser funds required to settle based on the line items entered by all participants and the Balance due to Vendor.
These calculated figures result in a more streamlined experience by providing a consistent way of calculating the vendor’s surplus funds and the funds required to settle by the purchaser.
Vendor’s funds:
- Previously, the Mortgagee on Title and Proprietor on Title would initiate a Workspace Conversation where the outgoing Financial Institution was to collect all funds from settlement to confirm the amount to be disbursed. In the Enhanced Settlement Summary, the surplus amount is calculated by the system and agreed by the Practitioner, and the Mortgagee on Title is prompted to add the surplus amount into the Financial Settlement Schedule..
- With the Enhanced Settlement Summary, the Unallocated Funds amount represents the remaining funds available to be disbursed to the Vendor. When the Proprietor on Title has completed entry of the Vendor’s line items, the Unallocated Funds calculation provides the Mortgagee on Title a clear indication of the remaining funds available. Once the Mortgagee on Title creates the loan payout(s) required, then the Unallocated Funds will be the amount required to be disbursed to the Vendor’s nominated account.
Purchaser funds required to settle:
- Previously, the Incoming Proprietor had to manually calculate the Total Funds Required to Settle and enter this value into the PEXA Workspace.
- With the Enhanced Settlement Summary, the Purchaser Funds Required to Settle (previously Total Funds Required to Settle) amount is now calculated by the system as the sum of the Balance Due to Vendor amount + Purchaser Payment Directions amount. When the Incoming Proprietor has completed entry of the Purchaser’s line items, the Purchaser funds required to settle will be the amount required by the Incoming Mortgagee.
Note: The system calculations are only available where there is a single Transfer, no more than one Discharge, and/or no more than one Mortgage in the Lodgement Case. In scenarios where there is more than one Transfer, Discharge, or Mortgage document within the same Workspace, PEXA is unable to determine the nature of the transaction. Therefore, the Incoming Proprietor is required to manually calculate and enter the Total Funds Required to Settlement amount into the Workspace.
Other improvements
Signing Status
The improved Settlement Signing Status panel now clearly shows the signing status of each participant in the Workspace. Adding the signing status provides more meaningful context where dual signatures are required (visible only to the Subscriber who has dual signing enabled).
Completing line items
Participants in the role of Incoming Proprietor are required to click the Ready for shortfall button (where the Incoming Mortgagee is handling shortfall) after they have completed entering their line items. This notifies the Incoming Mortgagee via a task and an on-screen button that they may now enter or update the shortfall amount.
Participants in the role of Proprietor on Title are required to click the Ready for surplus button (where the Mortgagee on Title is handling surplus) after they have completed entering their line items. This notifies the Mortgagee on Title via a task and an on-screen button that they may now enter or update the surplus amount.
Entering shortfall amount
If the Incoming Proprietor is responsible for providing shortfall funds, a button will appear on the Purchaser Funds panel, enabling them to either:
- Add as shortfall where the Purchaser’s Equity line item has not been created, or
- Update shortfall where an existing Purchaser’s Equity line item already exists.
When they click this button, they’ll be directed to the Add/Edit source line item entry screen with the shortfall amount pre-populated based on the new calculations built by PEXA.
Similarly, if the Incoming Mortgagee is handling shortfall, they will be presented with a task and either button above, after the Incoming Proprietor has clicked Ready for shortfall.
Entering surplus amount
If the Proprietor on Title is responsible for directing the vendor surplus funds, a button will appear on the Vendor Funds panel, enabling them to either:
- Add as vendor surplus where the Vendor’s Funds line item has not been created, or
- Update vendor surplus where an existing Vendor’s Funds line item already exists.
When they click this button, they’ll be directed to the Add/Edit Destination line item entry screen with the surplus amount pre-populated based on the new calculations built by PEXA.
Similarly, if the Mortgagee on Title is handling surplus funds, they will be presented with a task and either button above, after the Proprietor on Title has clicked Ready for surplus.
More details will come over the coming days, but in the meantime, please visit the Enhanced Settlement Summary site to learn more about this feature or join the pilot group.
