Refinance plus purchase made easy
Innovation and Tech

Refinance plus purchase made easy

By PEXA • Mar 2018

First Mortgage Services shares its experience with linked sequential lodgements

First Mortgage Services (FMS) deliver a broad range of business process outsourcing services to the financial services industry, including Conveyancing. A common transaction outsourced to them is a refinance plus purchase. One of the most frequent examples of this transaction is when a buyer refinances their home and uses the equity to purchase a second property.

Although considered two separate transactions they are linked by the customer who requires the funds from the refinance before the purchase occurs.

Refinances moved online

Refinance transactions are now processed online in VIC, WA, NSW, and SA. The purchase of a property – although possible online – can still be completed via paper. This dual process i.e. a refinance (online) plus purchase (paper), may result in the following issues:

The refinance must be monitored continuously in case it fails or gets pushed out. If this happens the paper transfer will have to be rescheduled.
If the parties involved aren’t aware of the change in refinance settlement, the transfer process will continue until the change is known; ultimately wasting time, delaying the transfer even longer and leaving the buyer exposed.

To avoid these complications a refinance plus purchase can be completed online via PEXA’s Linked Sequential Lodgements. As a result, the purchase doesn’t happen until the refinance is successful and you no longer need to monitor the refinance to manually reschedule settlements.

Furthermore, if the electronic refinance is delayed, the transfer is automatically rescheduled every hour until the transfer happens that day.

Experienced online transactor

Liam Rider, FMS Team Leader of Discharges and PEXA has witnessed both Linked Sequential Lodgements and the dual process, refinances (online) plus purchase (paper). In his experience, Linked Sequential Lodgements always run much smoother.

“At FMS we have different teams doing PEXA settlements and paper settlements.”, Liam shares. “When it’s all on PEXA, one-person controls both the refinance and the purchase and any required amendments to amounts etc. are a lot easier.”

“On the other hand, when completing a refinance (online) plus purchase (paper) complications can commonly arise. For example, paper purchases may sometimes fall over due to incorrect documents being brought by other parties, and insufficient time frame being available for these to be corrected when the PEXA refinance is Ready at the booked time and the PEXA transaction has gone through. In such situations the client is potentially left exposed until the purchase can be rebooked and settled later.”

“The beauty of linked lodgements is one can’t settle without the other, avoiding all the chaos surrounding paper settlements.”

Liam and his team have seen the benefits of transacting online firsthand, not just for banks and conveyancers, but more importantly for the customer.

If you’d like to learn how to link sequential lodgements online and gain the same benefits and efficiencies as FMS, you can follow this step-by-step guide on the e-Conveyancing Community.

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