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Do I have to keep all this paperwork? What records should I keep?
The answer to the first question is YES.
The first thing you should do when buying or selling is OPEN A FILE!
We don’t care whether it’s in a filing cabinet or a shoe box, but KEEP ALL THE PAPERS TOGETHER that relate to the sale or purchase. And you’ll probably need to keep them for a range of reasons (tax, clarity, dispute resolution, etc) for a great many years, so keep them well.
Regarding the second question, as the total of all the paperwork you’d get from the settlement agent, the real estate agent AND the bank would easily fit in a suspension file for a filing cabinet, it’s easy for us to just say “yes, just keep it all.”
However, if you want a more minimalist approach, here is a list of the documents you ABSOLUTELY MUST KEEP and how long for:
- Duplicate Certificate of Title (commonly known as the title deed): This needs to be kept very securely for the entire time you own the property.
Very commonly, you don’t actually get the title deed for one of two reasons: First, there is a mortgage against the title which means that the bank gets the title.
Second, it is a non-issue title, which are becoming increasingly common and which we certainly recommend as it is one less complication at settlement if you can’t find your title.
If a Duplicate Certificate of Title has been issued and you lose it, this is a major problem and a major concern that the property is not being fraudulently dealt with. The anti-fraud mechanisms instituted by Landgate over the past few years have made the process of obtaining a replacement Duplicate Certificate of Title far more difficult. The best solution is to either surrender it to Landgate as a non-issue title, or keep it very securely in a safe or in a bank safe deposit box. And REMEMBER WHERE IT IS!
- Contract of Sale (also known as the Offer and Acceptance), including any variations or extensions to it: This should be kept for at least 5 years after you sell the property. It may be required for tax purposes, and for the resolution of disputes that arise after settlement.
We will send buyers the original contract of sale bearing the [stamp] duty endorsement following settlement. Sellers have the right to request a duty-endorsed copy as well.
The significance of it being duty-endorsed (ie stamped) is that you cannot rely on a contract (or other dutiable instrument) in a court unless the duty on it has been paid and the contract duty-endorsed.
- Final Settlement Statement: should also be kept for at least 5 years after you sell the property, likewise largely for tax purposes, but also for the resolution of disputes.
- Electrical safety certificate Due to the massive fines for sellers ($15,000 for individuals or $100,000 for corporate entities for RCD’s and $5,000 for hard wired smoke alarms), we strongly advise both sellers and buyers to keep a copy of electrical safety certificate at least for as long as the new owner owns the property.
- All other documents should certainly be kept for the duration of the settlement, and probably until the end of the following financial year.
One other point that is important, is that many of these records must be kept for a very long time, considerably longer than the usual 5-7 years, so you should have a separate set of records that don’t just get cleaned out every year, or every 5-7 years, but should be marked “keep forever.”
DISCLAIMER: The above advice is intended to provide a summary and is not intended to be relied on in any particular case. It should NOT be construed as legal advice. For detailed advice specific to your circumstances you should seek specific advice from an appropriately qualified professional.