LEGAL TALK: Steps for transferring a new house to your name

Question:

How long does it take for an attorney to get a house that’s being bought transferred into the name of the new buyer?

Answer:

Your dream house is in the market. You believe you can afford to buy it and want to make an offer to purchase the house. But what are the necessary steps?

The first step is to get your offer to purchase on paper. (also referred to as a Deed of Sale). Once the seller has accepted and signed the offer, a binding agreement of sale is created and the transfer process can start.

If you do not have cash to buy the property and you must apply for a mortgage loan, the bank will request a copy of the Deed of Sale. Once your application is approved they will send an instruction to their bond attorneys to register the bond.

The bond attorneys will draw up the necessary bond documents to be signed by the purchaser. These will include FICA documents as required by law.

The cancellation attorneys will become involved where there is still an existing mortgage bond on the property. The bank who holds the bond as security for the property will instruct its own set of attorneys to draw up cancellation documents for the cancellation of the bond.

To start the transfer process, a third set of attorneys, namely the transfer attorneys must draw up the transfer documents to be signed by the buyer and the seller and effect the transfer of the property in the name of the buyer.

Usually the transfer attorney is nominated by the seller, but the buyer can negotiate this with the seller. The transfer attorneys will require the original or certified copy of the Deed of Sale.

The transfer attorneys will accordingly apply for the following:

1. Cancellation figures – if there is an existing bond on the property, the transfer attorneys will apply for cancellation figures from the applicable bank.

2. Rates clearance figures from the local municipality and utility providers (such as Centlec). The figures will include estimation for four months in advance. The transfer attorneys must receive these figures in order to proceed with the process. Once the figures are received the Seller must settle the amounts following which a rates clearance certificate will be issued which is needed for the lodging of the transfer documents with the Deeds Office.

3. Transfer duty on the property must be paid to SARS before the transfer can take place (if it is not a VAT transaction). The transfer attorneys will apply on your behalf for a transfer duty return from SARS.

4. Various certificates are required for the registration process (some compulsory, others required in specific cases), such as electrical certificates, entomologist and electric

fence certificates, gas certificates etc. The electrical compliance certificate is compulsory in all cases and the transfer attorney will usually request such a certificate from a registered electrician on instructions of the seller.

The final step in the process of transfer, after the above steps have been finalised, is the lodgement of the transfer documents, together with the new bond and cancellation documents if applicable, at the Deeds Office. Once the deeds have been lodged for registration, the deeds will be examined by the Deeds Office.

This process can take between five to 10 working days depending on the relevant deeds office, following which, if there are no amendments required on the deeds, the deeds will come up for registration, whereafter registration will take place.

The purchaser becomes the owner of his dream home and the seller receives his money after settlement of the existing bond amount.

The registration process usually runs smoothly, but given the complexity of some transactions, delays can very easily occur. So talk to your attorneys and make sure you understand the process and the requirements of all the various parties involved.

Lezea Grobler – DBM Attorneys

  AUTHOR
Reveshni Moodley
Editor

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