The transfer process
Step by Step Transfer Process
The buyer signs an offer to purchase (OTP). The Seller, in return assigns the OTP in acceptance of that offer. The sale agreement or deed of sale is a binding contract between the buyer and the seller that forms the basis of the transaction.
The buyer or their bond originator applies to the bank for finance. A bond application will generally form part of the suspensive conditions. Suspensive Conditions are events that need to happen or be met before the sale is finalised. Obtaining the Bond may be one of the suspensive conditions, another common suspensive condition is the sale of the buyer’s existing home
Once the Buyer’s Bond is Approved: The estate agent will send the sale agreement to the transferring attorney. If there is an existing bond over the property, the transferring attorney will then contact the seller’s bank and request the original title deed and cancellation figures, also referred to as discharge costs – this is the figure required to settle the seller’s bond. The buyer’s bank will then instruct a bond attorney to register a mortgage bond.
The seller’s bank instructs their attorney, the cancellation attorney, to cancel the seller’s bond. The cancelation attorney then sends the title deed and guarantee requirements to the bond attorney and the transferring attorney.
The transferring attorney requests for Rates Clearance Certificate from the local council. A property can only be transferred once all municipal charges have been paid in full to the relevant parties.The seller must pay a few months in advance (usually 3 to 4 months council dependent ) to obtain the certificate, however any credit on the account at the date of transfer will be refunded.
The buyer and seller will be contacted by the transferring attorney to come in and sign the documents. The buyer will be required to sign a Power of Attorney to Transfer, as well as a number of affidavits to verify their marital status, financial status and identity. Buyers can prepare for this by getting the following documentation in order:
– A proof of address (not older than three months)
– A certified copy of their identity document
– Their income tax number.
– Declaration in respect of marital and solvency status
– Particulars concerning the identity of the attorney transferring the purchaser’s property if the buyer is utilising the proceeds to pay for his purchase
– Particulars of the bond granted
These documents will be needed to meet the Financial Intelligence Centre Act (FICA) requirements. Apart from FICA, the transfer process is required to satisfy the necessary criteria of several regulatory institutions such as the Transfer Duty Act and the Value Added Tax Act for the South African Revenue Service (SARS) and the Municipal Property Rates Act.
The buyer pays the transfer costs and their share of the rates and taxes. A pro forma account will be presented to the buyer with estimated costs.
Before LODGMENT the transferring attorney & Bond Attorney requires from the SELLER the Electrical compliance certificate & Electric Fence certificate (if applicable) & the gas certificate (if applicable)
Attorneys Involved: One of the attorneys that will be appointed during the process is the Transferring Attorney – they attend to the Transfer of the Property from the Sellers name into the Buyers name and register the title deeds carrying the new information at the Deeds Office. The buyer’s bank that had granted them the loan, will then instruct a Bond Attorney to register a mortgage bond, which is registered in the Deeds Office. The Bond Cancellation Attorneys that requested the final amount to cancel the sellers bond (if any) this is registered at the deeds office as a Cancellation of an existing bond. Once ALL above steps are in place, All of these Attorneys lodge their documents simultaneously at the Deeds office.
The transferring attorney will contact both the cancelling attorney and bond attorney to ensure that all the documents are lodged on the same day. The documents must be registered at the same time because the seller’s bank has guarantees to ensure it will be paid when the bond is cancelled, and they are not prepared to cancel the bond until the new bond is registered.
A Deeds Office examiner will check all the documentation. This will take between seven and ten days working days depending on how busy the Deeds Office is.
Once the documents have been examined, the examiner will contact all the attorneys to inform them that they are in order and will be registered the following day.
The documents are registered –The Transferring Attorney receives the funds from the Bond Attorneys, who in turn will cancel the Existing bond by paying the Bond Cancellation Attorneys the requested Cancellation figures. The Transferring Attorney will also pay over the Agents Commission and any other costs incurred by the seller during the transfer process and the seller is paid his proceeds into the allocated bank account. The buyer becomes the owner of the property, and would need to do the change of ownership of his municipal bill at his local municipality.
The transferring attorney will receive the original title deed from the Deeds office after a couple of weeks and send it to the buyer’s bank via the Bond Attorneys. In the instance where the buyer does not have a bond, the title deed will be sent directly to the buyer.
Services & Expertise
We Specialize In The Following Areas :
General conveyancing advice.
Sale of immovable property, including commercial, residential, and industrial property.
Leases and the advice on the drafting and preparation thereof.
Transfers of shares, interests and claims in share block schemes.
Opening of Sectional Title Registers.
Registration of Sectional Title Schemes and variations of existing schemes and registration of Sectional Title transfers and bonds.