Purchasing Immovable Property
1. A MORTGAGE BOND
Congratulations on embarking on the journey of purchasing, or selling, a property!
When potential purchasers and/or sellers venture out into the property market, the experience and process can be daunting to all involved.
Phillip Silver Mathura Inc. ("PSM Inc."), has been actively involved in the conveyancing process for more than 10 years, and it is with this experience in hand, that we offer a series of articles setting out the different stages involved in purchasing or selling a home.
In our first article of the immovable property series, we delve into the bond registration process.
Many potential purchasers approach financial institutions for pre-approval of a mortgage bond, prior to attending viewings with estate agents, or, utilize the services of a bond originator.
A proof obtaining pre-approval is the impression that this creates with estate agents, as well as sellers, and further gives you, as the purchaser, a clearer indication of the area in which to narrow your search and the types of properties that are within reach.
Upon signing an Offer to Purchase for immovable property, purchasers are to contact their banks for initialising the bond registration process. The bank will, from a registered panel of attorneys, instruct conveyancers to attend to the bond registration, ("the bond attorneys").
Once an attorney has received an instruction to register a bond, a timer starts for the completion of the registration process. This timeframe differs from bank to bank.
The bond attorneys will make initial contact with the purchaser/s to obtain personal information in order to draft the bond registration papers. For example, purchaser/s would sign, inter alia, a home loan application, life and/or home owner's insurance documents, and affidavits.
Once the bond attorneys have drafted the necessary documentation, purchaser/s are required to sign the same to enable the bond attorneys to upload the documents to the bank via an online portal.
Should all be acceptable to the bank, the bond attorneys will receive a "proceed" to lodge and register a bond in the Deeds Office. Bear in mind that the bond attorneys will work hand-in-hand with the transferring attorneys to lodge the matter in the Deeds office.
The bond registration process can take anywhere between 25 to 60 days from instruction to registration in the Deeds Office.
2. MORTGAGE BOND CANCELLATION PROCESS
Paying off a bond, or selling a property, can be an exhilarating and scary process all at once.
In this second article of our immovable property series, we take you through the steps of cancelling your bond.
Many bondholders are unaware of this fact, however, should you have to cancel your bond, you are required to pay bond cancellation costs to a bond cancellation attorney.
When you initiate the process of cancelling your bond with the relevant financial institution/bank, the bank shall appoint a firm of attorneys on their panel to attend to the cancellation.
The notice provided to the bank to cancel your bond needs to be in writing and in most cases provided three months in advance - this is to avoid any penalty fees payable.
Once an attorney has been instructed by the bank, the attorney will receive, along with the instruction, what is known as bond cancellation figures which set out the amount currently outstanding, if any.
The attorneys would draft a document known as a "Consent to Cancellation" which would be signed by the person authorised to do so on behalf of the bank.
The bank and/or transferring attorney would need to issue a Guarantee in the banks' favour to the attorney to settle any outstanding amount on registration.
If there is no transfer involved, the attorneys would request the original Title Deed and bond from the bank to have the same lodged in the Deeds Office, along with the signed consent.
Once the bond cancellation has been registered in the Deeds Office, the attorneys will obtain your original Title Deed and Mortgage Bond and make the same available to you for safekeeping.
The entire process can take anywhere between 25 to 40 days from instruction to cancellation in the Deeds Office.
3. TRANSFER PROCESS
In the last article of our immovable property series, we zone into the property transfer process as well as the culmination of all processes linked thereto.
When an Offer to Purchase is received by the conveyancers, the conveyancing secretary begins the process by contacting all parties involved, the seller, the agent and the buyer, to introduce the firm and explain the processes to be undertaken as well as the documents that are required.
The conveyancing secretary further contacts the bond and bond cancellation attorneys, if any, to enquire as to their progress with collating the necessary documents for the bond cancellation on the seller's behalf and bond registration on the buyer's behalf.
Once the above steps have been attended to, the conveyancers would secure the purchase price from the buyer, which is to be invested into an interest-bearing account.
The conveyancer will then attend to requesting Rates Clearance figures, Levy Clearance figures, and the Transfer Duty receipt from SARS.
Simultaneously with obtaining the abovementioned documents, the conveyancer would request all parties to sign the transfer documents.
As soon as all of the documentation has been prepared and are ready to be lodged in the deeds office, the conveyancer checks the finances on the file to ensure that all the costs involved have been covered and paid up to date.
The conveyancing secretary then arranges with all attorneys involved to have their documents delivered to the deeds office for lodgement on the same day. The process between lodgement and registration in the deeds office normally takes between 8 to 10 working days from the date of lodgement.
Once registration of transfer is complete, the deeds office issues a title deed confirming the purchaser as to the registered owner of the property.
Upon registration, the bank will pay the bond into the purchaser's account and the conveyancers will pay the proceeds of sale to the seller.
With more than 10 years of experience in the conveyancing industry, Phillip Silver Mathura is well equipped to attend to your transfer, bond and/or bond cancellation.