Frequently Asked Questions
FAQ
Top 3 Questions
What is the role of the conveyancer?
Conveyancers attend to the process of actually transferring legal ownership of fixed property from one person (or a company or trust) to another. In a nutshell, this process amongst other things, involves ensuring the deed of sale meets all the legal requirements, including requesting and collecting supporting information (such the mortgage bond, cancellation figures, title deeds, compliance certificates, and the amounts from the municipality for a rates clearance certificate). The conveyancer is also tasked with drafting all the necessary documentation (such as a “power of attorney to pass transfer” for the seller to sign, a declaration in respect of marital status, ID Number as well as the bond registration documentation for the purchaser when registering the bond) that needs to be lodged with the deeds office to finalise the registration of the sale.
What is conveyancing?
Conveyancing relates to the legal process that transfers ownership of the home from the seller to the buyer. The conveyancer (who is an attorney) is usually appointed by the seller, but paid for by the buyer (due to the nature of the transaction, the seller is at greater risk and this appointment is therefore a general rule of thumb).
Who appoints the Conveyancer?
The seller appoints the conveyancer. However, this may be varied by agreement between the parties.
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How are the conveyancing fees calculated?
Firstly, it must be noted that there are distinct and separate fees related to the overall transfer costs of a property. And conveyancing fees is only one of them. The others are transfer duty and bond registration costs. Conveyancing fees are determined by the Legal Practice Council and are generally calculated on the purchase price or the amount of the bond to be registered and calculated as prescribed by the guidelines as issued by the Legan Practice Council.
To who must the deposit be paid in a property transaction?
The agreement will stipulate to whom the deposit is paid. The deposit is paid into the trust account of either the agent or the conveyancer. The agent or the conveyancer will then invest the deposit in an interest-bearing account for the benefit of the Purchaser, which interest is paid over to the purchaser on registration of transfer.
What is a suspensive condition in an offer to purchase?
A suspensive condition is a condition in an agreement of sale that suspends the rights and obligations of the agreement until the occurrence of a certain future event. E.g., until the purchaser obtains the required bond grant.
What happens if the purchaser does not obtain the required bond grant or the suspensive condition is not fulfilled?
The agreement is null and void and no claim for damages can be made.
Who is liable to pay the transfer costs in a property transaction?
The purchaser pays the transfer costs to the conveyancer, which includes transfer duty. The purchaser is also liable to pay the bond registration costs to the bond attorneys.
Can I make changes to my offer after it has been accepted by the seller?
Once an offer has been accepted by the Seller, any changes or amendments thereto should be reduced to writing and signed by all parties. It is advisable to consult a conveyancer to ensure that any amendments do not invalidate the agreement.
Is it necessary to seek professional advice when drafting an offer to purchase?
Whilst it is not mandatory to seek professional advice when drafting an agreement of sale, it is advisable to consult a conveyancer who can provide valuable insight and guidance throughout the process and can assist in ensuring that your offer is valid, protecting your interests and navigate any legal complexities which may arise.
What is transfer duty?
Transfer duty must not be confused with transfer costs, which include all the expenses associated with a property transfer.
Transfer duty is the tax component of the purchase of the property, payable to SARS and is therefore statutory. Meaning it cannot be negotiated.
Transfer duty is owed over and above the purchase price and is based on the bank valuation amount, not the selling price of the property. This tax is paid by the buyer and the payments thereof handled by the appointed conveyancer on the buyer’s behalf. Generally, SARS regards the purchase price of the property to be its value, unless of course SARS is of the opinion that the purchase price is not a true value of the property. In other words, where the value of the property has been understated, transfer duty will be paid on the market or fair value.
What are the Bond registration costs?
Once a bond has been granted and the buyer has accepted it, he/she will pay fees to register the bond to the bond attorneys. The process of registering the bond over the title deed is handled by the conveyancer.
When are the transfer documents signed?
The transfer documents are drafted and signed once all the conditions of the offer to purchase have been met, the conveyancer has received the requested FICA documents from all the parties and has received a copy of the title deed from the Seller or the bank (if there is a bond registered over the property).
How long does a transfer take to register once it is lodged in the Deeds Office?
Registration usually takes approximately 7-10 working days from date of lodgement. However, this time period differs depending on the Deeds Office where the transfer is lodged.
What happens to my original title deed once the transfer has registered?
Upon registration, the Deeds Office attends to microfilming the transfer documents, including the title deed. Thereafter, the deeds are released to the transferring attorneys. In the event that there is a bond registered over the property, the transferring attorneys will hand the original title deed to the bond attorneys who will then deliver same to the bank. The bank safeguards the original title deed until the bond is cancelled. However, where no bond is registered, the transferring attorneys will hand the original title deed to the new owner thereof for safe keeping.
Can the transfer documents be signed overseas?
Yes they can, however certain rules for signing will need to be followed. The procedure to be followed will depend on the country where the documents are being signed. E.g. The documents may need to be signed before a Notary Public and then Apostilled or they can be signed at the South Africa embassy.
What is a Notary Public?
A Notary Public is an admitted attorney admitted and authorised by the High Court of South Africa to witness signatures, draw and attest contracts and statements, and authenticate the validity of certain documents which is internationally recognized.