Separating and Buying on the Same Day: The Risk No One Warns You About

When a couple separates, the focus is usually on who keeps what, who moves out, and how the finances will be divided. What often gets overlooked is what happens if both parties plan to sell the family home and each buy a new property on the very same day. It sounds simple enough on paper. In practice, it can turn into one of the most stressful days you will ever experience.

This issue comes up more often than people realise. One property sells, two new properties are purchased, and both people are relying on the funds from the sale to make their settlement happen. Under Victorian practice, everything is handled through PEXA, but PEXA has a limit. It will only allow one of those follow-on purchases to receive the sale funds automatically.

The other party must take the riskier route. Their funds need to be sent out of PEXA into a trust account, then pulled back into the PEXA system for their own purchase. That sounds easy until the banking system decides to run slowly or hold funds for verification. Funds can be delayed, banks sometimes flag transfers for compliance checks, and the purchaser left waiting is sitting on a ticking clock.

In Victorian conveyancing, time is not just important. Time is everything. If the money does not show up inside PEXA when needed, that purchaser risks default. Penalty interest starts running under the contract. The vendor may even issue a default notice. When two people are separating, this is the last thing anyone needs.

This is why separating couples must decide, before signing anything, who is going first. Someone gets the benefit of the linked transaction, where the sale proceeds feed straight into their purchase without leaving the PEXA system. The other person must accept the timing risk of funds moving through the banking network. It is not unfair. It is simply how the technology works.

The Conveyancers Act 2006 (Vic) requires us to act competently and to warn clients of foreseeable risks. This is one of those risks. Many buyers never hear about it until the week of settlement, and by then, the contracts are already locked in and difficult to adjust.

There are ways to manage it. You can stagger settlement times rather than settling both purchases at the exact same minute. You can plan for the non-linked purchaser to have temporary access to extra funds from a bank, though this depends entirely on lender approval. Or you can decide that one party must purchase on a different day. It is not ideal, but it is far safer than a same-day chain going wrong.

Selling one property and buying two is always a bit of a circus. Doing it while separating adds an emotional load on top of a technical one. But the most important thing is understanding where the real risk sits. Someone has to take it unless the settlements are unlinked. And if you do not prepare early, that risk will find you at exactly the wrong moment.

If you are separating and planning multiple settlements on the same day, get in touch early. Victorian Property Settlements can help you map the safest path forward and avoid the problem of funds disappearing into banking limbo at the exact moment you need them most.

Victorian Property Settlements – Trusted for over 25 years by Victorian buyers and sellers. Visit: www.victorianpropertysettlements.com.au