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Conveyancing process explained

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Conveyancing process explained

Category Legal

STEP l  |  OFFER TO PURCHASE
 
In terms of The Alienation of Land Act 68 of 1981 the sale of immovable property has to be reduced to writing and signed by both the seller and purchaser to constitute a valid and binding agreement.
 
The purchaser signs the Offer to Purchase and once the seller accepts same and signs the offer, it becomes a binding contract and is referred to as the Deed of Sale.
 
The estate agent will hand the deed of sale to the conveyancer nominated in the deed of sale (usually the conveyancer of the seller 's choice).
 
A conveyancer is an attorney, specialising in property law and who attends to the registration of transfer of the property to the purchaser.

STEP 2 | SUSPENSIVE CONDITIONS
 
Deeds of sale of residential properties are often subject to the purchaser obtaining a loan from a bank or the sale of his or her existing property.
 
These are called suspensive conditions and until such conditions are fulfilled, the sale is not complete.
 
The deed of sale normally has a time period for fulfilment of suspensive conditions and if they are not fulfilled in time, the sale will lapse.

STEP 3 | PREPARING THE TRANSFER DOCUMENTS

Once all suspensive conditions of the deed of sale are fulfilled the conveyancer can start with the transfer process.
 
The conveyancer will request the following from both the seller and purchaser:
 
I.  Identity documents
2. Proof of residential address  (i.e. Municipal, Telkom account - not older than 3 Months)
3.  Proof of marital status (Marriage certificate, Ante-nuptial contract)
4.  Proof of income tax numbers.
 
The conveyancer will do a deed search on the property to see if the property is bonded. If so, the conveyancer will request cancellation figures and the title deed from the relevant bank.
Once all relevant information is gathered, the conveyancer will commence drafting the transfer documentation.

STEP 4 | CLEARANCE CERTIFICATES

Certain Clearance Certificates need to be lodged with the Deeds Office before it will allow the transfer to be registered.
 
Municipal rates clearance: The conveyancer applies for municipal rates figures from the Municipality. The rates clearance certificate issued by the Municipality is valid for 120 days (Municipalities may vary).
The seller is responsible for the payment of all the outstanding rates and municipal services and will also ensure payment for advance collections on his/ her rates and municipal services. The seller will either be refunded by the municipality if a credit is shown on hi s/ her account after the date of registration or the seller will receive payment pro-rata from the purchaser.
 
Body Corporate Levies: where a Sectional Title Unit is being sold, the conveyancer will request a levy clearance certificate from the body corporate. The seller is responsible for the payment of the levies to obtain the certificate.
 
Home Owners' Association: If there is a Home Owners' Association the conveyancer will apply for consent to transfer the property.

STEP 5 | SIGNING ALL RELEVANT DOCUMENTS

The conveyancer will set up appointments with both the seller and the purchaser to sign all relevant documentation.

If the purchaser is making use of a bond to purchase the property the bond attorneys will arrange for the signature of the bond documentation.

STEP 6 | PAYMENT OF COSTS

The purchaser is usually liable for the payment of transfer costs, which includes transfer fees payable to the conveyancer. This fee is calculated on a sliding scale as a percentage of the selling price or value of the property.
 
The cost also includes transfer duty payable to SARS. Transfer duty is also calculated as a percentage of the selling price or value of the property.
 
The conveyancer will provide a detailed breakdown of the costs, which varies from time to time.

STEP 7 | GUARANTEES AND COMPLIANCE CERTIFICATES

The conveyancer will request guarantees for the full purchase price or alternatively the purchase price can be deposited into the conveyancer's trust account.
 
The deed of sale will normally contain certain provisions for the supply of an Electrical Certificate, Plumbing Certificate (certain municipalities require same), Beetle Certificate, Gas Certificate and Electrical Fence Certificate. It is usually the seller's responsibility to supply these.

STEP 8 | LODGEMENT AT THE DEEDS OFFICE


After the conveyancer has obtained the transfer duty receipt, the rates clearance certificate, the original title deed and any other clearance certificates, arrangements will be made for lodgment in the Deeds Office. The transfer documents will be lodged simultaneously with the cancellation of all existing bonds and registration of the new bond  (if applicable).
 
After lodgment the documents are examined by the deeds office examiners for accuracy of the title deed conditions and other requirements. This process can take anything from I0 to 15 working days, where after (if in order) the deeds will come up for registration in the "prep room".
 
Once the deeds are on "preparation" the conveyancer has a period of 5 working days to finalize any outstanding’s and to hand the deeds in for registration.

Author Jannie Fourie, Principal
Published 01 Feb 2016 / Views -
Disclaimer:  While every effort will be made to ensure that the information contained within the Agrisell website is accurate and up to date, Agrisell makes no warranty, representation or undertaking whether expressed or implied, nor do we assume any legal liability, whether direct or indirect, or responsibility for the accuracy, completeness, or usefulness of any information. Prospective purchasers and tenants should make their own enquiries to verify the information contained herein.
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