Once there is an interested buyer a written Offer to Purchase will be prepared by your Sales Agent. The price on the offers will generally differ to that of your selling price. You are under no obligation to sign any one offer but it is advised to be realistic in terms of the market related value of your property.
The agent must explain the offer to you to ensure that you are aware of and understand all the terms and conditions of the offer. Once an offer has been accepted and signed by you, all parties are legally obligated to follow through with the transaction unless there were any conditions of sale that were not fulfilled in the stipulated time period as per the offer.
Rates and Clearance
- A Rates Clearance Certificate (a document stating that all rates and taxes for the current rates year have been paid) is obtained from the municipality by the Transferring Attorney.
- The Bond Attorney advises the Transferring Attorney of the amount available for guarantees and requests the draft deed of transfer and guarantee requirements.
- The Cancellation Attorney is requested to cancel the seller's bond, on receipt of a guarantee for the amount owing.
- The Transferring Attorney receives the title deed and bond cancellation figures and sends a copy of the deed of transfer and the guarantee requirements to the Bond Attorney.
- The Transferring Attorney requests the purchaser and seller to sign the transfer documents.
- The purchaser pays the transfer costs and the Transferring Attorney then pays the rates and taxes and the transfer duty to the South African Revenue Service.
- A Transfer Duty Receipt is issued.
- The Bond Attorney prepares the bond documentation together with the relevant statement of account.
- The purchaser signs the documents and pays the costs.
- The Bond Attorney prepares and issues the necessary guarantees, forwards them to the Transferring Attorney and prepares the bond documents for lodgement in the Deeds Office.
- Once the Transferring Attorney has received the guarantees, they are forwarded to the Cancellation Attorney.
Bond cancellation process
- The Cancellation Attorney obtains consent to the cancellation from the bank which holds the seller's bond.
- Lodgement at the Deeds Office after all the documentation has been signed and the costs paid, the transfer (including rates clearance certificate), new bond and cancellation bond documents are prepared by the respective attorneys for lodgement in the Deeds Office.
- All Bond and Transfer documents are inspected by the deeds registry and if correctly prepared, come up for Registration. It usually takes approximately 2 to weeks to check the documents before they are ready for Registration. At this stage the purchaser must have the balance of the cash purchase price available, and the financial institution's attorneys have the bond amount available.
- If the purchaser is not able to make the funds available, the seller's conveyancer will delay registration, which may be postponed for no more than 3 to 4 days before the deeds are rejected and will need to be re-lodged.
- The purchaser may then be put to terms and given 7 days written notice to rectify the default. Allow at least 12 weeks for the registration and transfer of the bond.
- Sellers responsibilities
- Factors that delay registration
- To give their bank 90 days notice should they have a bond over the property that will need to be cancelled. If a seller fails to do this, an early termination penalty may be added to his bond cancellation fees by the bank. This may result in either a possible shortfall for the seller or a delay of up to 90 days, should the seller wish to wait out this period.
- To comply with any warranties or conditions stipulated in the offer to purchase.
- To obtain the statutory required Electrical Compliance Certificate for the property prior to lodgement of the transfer in the Deeds office, issued by a certified electrician.
- To sign the transfer documents on the request of the Conveyancer attending to the transfer of the property.
- If there is a bond registered over the property, to pay the bond cancellation costs to the Attorneys who are appointed by the bank to attend to the cancellation of the existing bond. The seller will be obliged to keep up his monthly bond installments pending transfer of the property. If any interest is overpaid to the bank, it will be refunded to the seller by the bank after registration.
- To continue payment of municipal rates on the property, inclusive of electricity, water, sewer, and refuse accounts. Even though a tenant might lease the property from a seller, outstanding municipal revenue service fees still remain the sellers responsibility. Transfer of ownership cannot be done unless all these accounts have been settled as per legal requirement. To obtain the necessary rates clearance certificate, the seller will have to pay the council six months in advance.
- To request the council to take final meter readings of the consumption figures for the property prior to vacating the property.
- To vacate the property prior to the date of occupation and to comply with any condition in the agreement.
- To arrange with Telkom and/or the purchaser to transfer or cancel the telephone line.
- To furnish the Attorneys with the following documentation in order to comply with FICA:
- 1. Copy of his Identity Document
- 2. Income Tax registration number
- 3. Copy of marriage certificate and Antenuptial agreement if applicable
- 4. Copy of divorce order if applicable
- 5. Documentation that confirms proof of residence (not older than 3 months)
Factors that delay registration
- Failure by the seller and/or purchaser to provide information
- Failure by the seller to provide details of the bank holding the existing bond
- The existing bondholder delaying/not providing cancellation figures and Title Deeds to the transferring attorney
- Delay in receiving rates figures (from the municipality) and/or a clearance certificate
- Failure by the purchaser to pay a deposit (if required)
- Delay in the provision of guarantees
- Failure by the purchaser to pay bond and transfer costs on time
- Delay by the seller in signing the transfer documents
- Delay by the buyer in obtaining government capital subsidy approval/employee subsidy documents for new bondholders and failure to comply with other requirements of the bank
- Delay by the purchaser in signing the transfer and/or bond documents.