Property sales are complex and lengthy transactions, which means that any delay can be frustrating, costly and may even sink the deal completely.
However, some delays cannot be anticipated but you can reduce the risk.
According to Cobus Odendaal, CEO, Lew Geffen Sotheby’s International Realty in Johannesburg and Randburg, there are two types of delays:
– the first type of delay relates to the confirmation of the sale
– the second type of delay can occur once the sale has been confirmed.
Odendaal said that property transactions are known to be long drawn-out processes that have multiples and many pages of documentation.
Once the suspensive conditions and the contractual obligations have been navigated, the deal is finally done and signed on the dotted line, you can breathe a sigh of relief.
“However, the deal isn’t done until the transfer has actually happened and the anticipated downhill cruise to transfer can still become an uphill battle if one isn’t careful,” Odendaal said.
One of the main reasons for delayed property transfers is that the timeline is out of sync, particularly when two or more deals are linked and the money from one sale is needed for a different sale.
Odendaal emphasises the importance of having a budget for transfer costs for the home that they are buying or an access bond in place on their current home.
“Otherwise, when the attorney calls for bond cancellation that bond account will be frozen and they will not be able to access the funds,” Odendaal said.
Not giving the required 90 days notice for the cancellation of an existing bond can also cause delays as well as late cancellation fees.
“If a homeowner is seriously thinking about selling, they should give notice to the bank holding the bond,” Odendaal said.
“In doing so, they are not committing to selling, merely notifying the bank of the possibility and they can keep on renewing the cancellation if their decision to sell is postponed or they can revoke the notification if they change their minds.”
The role of a transferring attorney is to co-ordinate all the entities involved in the transfer of property, including the South African Revenue Services (Sars) for the transfer duty, the municipality for the Rates Clearance Certificate and the bank.
“In order to do this as seamlessly as possible, it is essential that both the buyer and seller submit all the necessary documentation in time, as per the legal requirements and without omissions,”Odendaal said.
“This is especially important if either party resides in another country or is in any way difficult to contact for information and signatures.”
According to Odendaal, issues during the transfer process most commonly occur at the following stages:
– Bond approval
– Bond cancellation
– The signing of transfer documents
– Obtaining valid compliance certificates
– Issues encountered at lodgements requiring the removal of notes by the Registrar of deeds.
Odendaal said that most delays can be avoided by co-operating with the transferring attorney.
If you are living outside of South Africa, you can give power of attorney to a person within the country who can sign the necessary documents and act on your behalf to avoid delays.
“It’s also vital that the client is completely upfront with the agent regarding their financial situation,” says Odendaal.
Agents can facilitate and expedite the process by having a bond originator pre-qualify you while the credit check will reveal any potential issues which can then be sorted out.
According to Odendaal, this step is critical for buyers who are self-employed because banks are very strict about the documentation that they require for a bond application.
“At this stage I always advise all my clients to avoid making any expensive purchases that could negatively impact their affordability,” Odendaal said.
Experienced estate agents will guide you and as long as they are upfront with your agent, there should not be too many problems.
Odendaal said: “I also recommend appointing an accomplished conveyancing attorney who is really on the ball. And, as the transferring attorney and agent work closely together behind the scenes to ensure a smooth transfer, it is always an advantage if they already have an established working relationship.”
IOL Property