In a commercial settlement involving several mortgages and caveats, what must happen in PEXA for the transfer to be lodged for registration?
Correct Answer
A) The discharges and caveat withdrawals must be lodged together with the transfer and new mortgage
In an electronic settlement, the discharges of the vendor's mortgages and the withdrawals of caveats are lodged in the same step as the transfer and the buyer's new mortgage. This keeps every instrument in the right order so the buyer and new lender get the priority they expect. Encumbrances that stay with the land, such as easements and covenants, are not discharged.
Why This Is the Correct Answer
Only the interests being released, the vendor's mortgages and any caveats, need discharging or withdrawing. Lodging those documents together with the transfer and new mortgage in the one PEXA settlement means the register is updated in the correct order with no gap in security. Easements and covenants that run with the land remain on the title.
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During settlement, what is the correct order of events in an electronic conveyancing transaction?
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