A deal has been agreed and an announcement is set to be made soon.
Lampard will be reunited Down Under with his former Chelsea team-mate Damien Duff, who has already signed for Melbourne City on a one-year deal.
“I said Sydney was the best place to live!! [Schwarzer is from there]. But I spoke very highly of Melbourne. I actually love Melbourne. It’s a great city. I told him how passionate in particular the Victorians are with their sport.
“There is huge potential in the game in Australia and it would be unbelievable if he went to Australia. I said to him that he would love living there. its a great place to live.
“He walked away with that and I know what he’s like. So we will see.”
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