What happens between signing the contract and settlement?

Signing the contract feels like the finish line. But it's actually the start of a distinct phase of the property purchase process. Between contract signing and settlement, a substantial amount of work happens in the background, and there are a few things you need to actively manage as the buyer.

It's part of our complete Victorian property buying process guide.

Understanding this period reduces anxiety and helps you avoid the most common causes of delays.

The settlement period: how long is it?

The settlement period is the time between exchange of contracts (when both parties have signed) and the settlement date, when the property legally transfers to you and money changes hands.

In Victoria, the standard settlement period is 60 days, though this is negotiable. Vendors or buyers sometimes want shorter settlements (30 days) or longer ones (90 days or more) depending on their circumstances. The settlement date is agreed between the parties and stated in the contract.

If you're buying at auction, the settlement period is typically 30 to 60 days, depending on what was advertised in the contract before the auction.

What your conveyancer does during this period

Most of the administrative work during the settlement period is handled by your conveyancer. Key tasks include:

Title searches: Your conveyancer searches the title to confirm ownership, check for encumbrances (mortgages, caveats, easements), and verify that the vendor has clear title to transfer to you.

Reviewing the transfer of land document: This is the formal document that transfers ownership from the vendor to you. Your conveyancer prepares or reviews this document.

Calculating adjustments: At settlement, certain outgoings are apportioned between the vendor and buyer based on the settlement date. Council rates, water rates, and owners corporation fees (for units) are split between the parties depending on how much of the billing period falls before and after settlement. Your conveyancer calculates these figures.

Coordinating with the vendor's conveyancer: The two conveyancers communicate throughout the process to ensure the paperwork is aligned and ready.

Liaising with your lender: Your conveyancer coordinates with your bank or lender to ensure the loan funds will be ready for settlement.

Electronic settlement (PEXA): Most Victorian property settlements now happen electronically through a platform called PEXA (Property Exchange Australia). Your conveyancer and the vendor's conveyancer both work within PEXA to coordinate the transfer of title and funds simultaneously on settlement day.

What your lender does during this period

If you're borrowing to buy the property, your lender has their own tasks to complete between contract and settlement:

Valuation: Your lender will order a formal valuation of the property (independent from the purchase price). This confirms that the property is worth at least the amount you're borrowing. Lenders typically use an automated valuation for straightforward purchases, but may order a full physical valuation for higher-value properties or unusual properties.

Formal loan approval: Many buyers have pre-approval before they sign the contract. Pre-approval is a conditional offer. Formal approval (sometimes called unconditional approval) is issued after the valuation has been completed and all conditions have been met. Until you have formal approval, the loan is not confirmed.

Loan documentation: Once formally approved, your lender sends you loan documents to sign. These need to be returned promptly to avoid settlement delays.

Preparation for settlement: Your lender organises the funds for settlement and confirms their participation in the PEXA settlement workspace.

Stamp duty: don't forget this one

Stamp duty (land transfer duty in Victoria) is one of the most significant costs of a property purchase, and it needs to be paid before or at settlement.

For most purchases, stamp duty is paid from the settlement funds through PEXA, so it's automatic. But you need to make sure the amount is available and accounted for in your budget. Your conveyancer will calculate the stamp duty payable and it will appear in your settlement statement.

First home buyers purchasing properties eligible for the stamp duty exemption or concession won't have this cost, but should still confirm with their conveyancer what (if anything) applies.

Building insurance from the contract date

In Victoria, it's advisable to take out building insurance from the date you sign the contract, not just from settlement. Once contracts are exchanged, the property is at your risk even before you own it. If something catastrophic happens to the property between contract and settlement (a fire, for example), you could still be obligated to complete the purchase without coverage if you haven't arranged insurance.

Your lender will also require building insurance to be in place before they release funds at settlement.

Contact your insurer shortly after signing the contract and confirm coverage from the contract date.

The pre-settlement inspection

In Victoria, buyers are entitled to inspect the property at a reasonable time before settlement, usually within the final week. This inspection is your opportunity to confirm that the property is in the same condition as when you signed the contract, and that all included items are still present.

We cover this in more detail in our pre-settlement inspection post, but it's worth noting here as a key task in the lead-up to settlement.

What can go wrong

Most settlements complete without significant issues. But there are common causes of delays:

Lender delays: The lender's valuation or formal approval process takes longer than expected. This can push settlement back if loan documents aren't ready in time.

Discharge of the vendor's mortgage: The vendor's lender needs to discharge their mortgage over the property. If the vendor is using the proceeds of this sale to pay off their own loan at a different bank, the coordination between two lenders can sometimes cause delays.

Outstanding issues on title: Your conveyancer's title searches may reveal something that needs to be resolved before settlement, such as a caveat or a lender's mortgage that the vendor's side hasn't organised to discharge.

Vendor complications: The vendor themselves may have delays on their end, particularly if they're simultaneously purchasing another property and the two settlements need to align.

If settlement can't proceed on the scheduled date, there are processes for extending it, though delays can incur penalty interest depending on the circumstances and whose fault the delay is. Your conveyancer manages this process.

Staying on top of your end

As the buyer, the main things you need to manage during this period are:

• Returning signed loan documents to your lender promptly
• Ensuring stamp duty and your deposit shortfall (if any) are available
• Organising building insurance
• Booking your pre-settlement inspection
• Responding quickly to any requests from your conveyancer

The settlement period feels passive, but staying responsive means it's much more likely to proceed on time.

Settlement day

Settlement itself, for most buyers, is now entirely managed by your conveyancer and your lender electronically through PEXA. You don't attend a physical settlement. The property transfers at the designated settlement time, and your conveyancer confirms when it's complete.

After confirmation, the agent is notified and you can collect your keys.

Sources

• Consumer Affairs Victoria: Property settlement: the regulator's guidance on the period between contract and settlement, including inspections and stamp duty.
• Sale of Land Act 1962 (Vic): the law governing the contract, cooling-off, and settlement obligations.

Sources verified 25 July 2026.