I have read this forum diligently for months and am in awe of the knowledge the regular (and not so regular) contributors possess in this property investing world, so thanks to everyone who shares here. You guys are such great motivation!
I have struck a slight complication in obtaining my first IP in Victoria so I am asking for advice. I have engaged a solicitor for the property purchasing transaction based on a recommendation from family and friends. The solicitor has so far done a fine job, but nothing out of the ordinary, in going over the Section 32 doc and the contract of sale etc., except getting the wording of two conditions in the contract of sale changed to better cover me. Now that I've paid my deposit and the contracts have been executed by all relevant parties, I have received am estimate of the solicitor's fees. Unfortunately, I did not ask for a quote from the beginning, and the estimate from the solicitor is $3500 (GST inclusive). That to me is outrageously expensive when compared to the average cost of a conveyancer or solicitor for a straightforward property purchase. I have since emailed the solicitor twice to get a breakdown and explanation of the estimate, but of course I have had no replies from her since I wrote the email two days ago. What should I do? Change to a conveyancer or at least someone with a cheaper fixed fee? If I do, will that be a hassle? Also, I'm afraid the cost of the solicitor's work up until now will be quite high already so maybe the combined cost of the solicitor plus the new conveyancer will just be as high.
I'm in two minds as to what to do and it's causing me a bit of stress.Joe007Participant@joe007Join Date: 2010Post Count: 1
The solicitor I use in Victoria is old school and fantastic.
If you want his details, that is, u decide to change, let me know.
Your Solicitor's charge is way to exorbatant.FreckleBlocked@freckleJoin Date: 2012Post Count: 1,680
Get a full schedule of costs when its all over. If I recall correctly you can challenge these fees through the legal professions own oversight body. TerryW or Darryl might be able to chime in here and clarify that for you.Jamie MooreParticipant@jamie-mJoin Date: 2010Post Count: 5,069
When I was working for a martin place law firm I did conveyancing and we charged by the hour, $350. I ended up charging cliens $11,000, $7,000 and the cheapest was around $3.500. This is for average properties too – $500k houses etc. Clients were often professionals and even lawyers.
The lawyer is supposed to disclose their fees up front and enter into a costs agreement with you.
Thanks for your comments everyone. I might get a quote from someone else, but lesson learned. So many to learn on this property investing caper!RPIParticipant@rpiJoin Date: 2012Post Count: 308
If you have not been provided with a costs agreement that complies with the legal profession act you should investigate further.
If we charged by the hour and everything was done by a soli it would often top that. We charge fixed and in some cases though at under a third of that.
We did receive a costs agreement, but not at the beginning when we engaged their services. We only got a costs agreement and disclosure statement halfway through the process (after contracts exchanged and deposit for the property was paid). If we cancel their services now, they will charge me for the work they've done up till now; can I challenge that since they did not provide the costs agreement upfront?
You can challenge it, but you received it near the start and let the lawyers proceed with their work. Did you sign a costs agreement? Even if you didn’t you implied you agreed to it by continuing to instruct. But this doesn’t mean you cannot ask them to reduce fees or you could challange it
I would have thought "near the start" would mean when we gave the contract and Section 32 to the solicitor to peruse, not after they've had the contract amended and we've all signed it. Anyway, we have not signed the costs agreement yet because we only received it yesterday, two weeks after engaging the solicitor to do the work.
It will come down to your negotiation skills and then the solicitor rules and regulations. Have a look at the solicitor rules VIC and Legal professional act vic.
Thanks Terry.wema7300Member@wema7300Join Date: 2013Post Count: 1
I found myself in a similar situation earlier this year. The law firm i used was one of the big national brands, but i don't see the added value of a lawyer compare to a settlement agent. The cost tripled compare to my usual bill from a settlement agent, but my file was handled by a paralegal!!
Lessons learnt – if the transaction is straightforward, a settlement agent is sufficient for the job.Jamie MooreParticipant@jamie-mJoin Date: 2010Post Count: 5,069
I tend to agree with you wema. For a straight forward purchase or sale a conveyancer should be fine. However, I also find that there are plenty of solicitors out there that will do the same job for a similar price anyway. Just make sure you have an understanding of their price structure before proceeding.
But how do you know if it is going to be an easy conveyance?
Conveyancers are not qualfied to advise in other related areas either – sucession issues, asset protection, bankruptcy.
What if it turns out to be the executor of a deceased estate…RPIParticipant@rpiJoin Date: 2012Post Count: 308