The Transfer Process
In general, a transfer takes approximately 7 – 8 weeks to transfer and this is conditional to all the suspensive conditions being fulfilled. For example, if the purchaser is still in the process of obtaining a bond then the transfer of the time it took to get the bond granted will be added to this time frame.
On some occasions it could take less time, however, this is the exception and not the rule. Do not let any attorney try and convince you otherwise.
The transfer process is a very specific one and no shortcuts can be taken. It is paramount that for attorneys to attend to the registration of a transaction within this time frame or any other agreed time frame, that the buyer and seller co-operate with the attorneys diligently.
Step by step summary of the process:
- Open a file and send all parties a letter acknowledging receipt and asking for certain information including FICA; calling for the deposit (if payable) and calling for payment of costs (including transfer duty); await confirmation of bond approval (if applicable) sale of other property or completion of any other suspensive conditions.
- Obtain a copy of the title deed from the deeds office and conduct deeds office search to check on marital status; determine whether any interdicts (attachments / any other types of restraints) exist over the property which may delay or obstruct registration.
- Send pro forma statement of costs to the buyer.
- Liaise with seller’s existing bondholder (if the property is bonded) to obtain bond cancellation figures and to obtain original title deed. If the property is not bonded then the seller is to provide the conveyancer with the original title deed.
- If the original title deed is lost a separate application must be brought to obtain a certified copy from the Deeds Office at additional cost to the SELLER.
- If the buyer has applied for a loan, the Attorney will liaise with the bond registration attorneys and request guarantees to pay the purchase price (less deposit if a deposit was payable) on registration of transfer. (Kindly note that the bond is registered with the transfer of the property on the same day. A fee is also payable to the bond registration attorney, separate from the transfer fee.)
- Prepare documentation necessary to give effect to the transfer. (Power of Attorney to give transfer; FICA Affidavits; Transfer Duty Declarations etc.)
- Meet with buyer and seller to sign transfer documents.
- Write to the managing agent (if the property is a sectional title) or Homeowner’s Association (if the property forms part of an HOA) to ask for levy figures and/or a letter of consent to the transfer. (If a property is a sectional title then we must determine what levies will be payable on transfer (if anything) and ensure that we will have sufficient funds. If it falls in an HOA it is always a title deed condition that a written consent to transfer is obtained from the HOA. We are finding more and more properties that have an HOA title deed condition, only to discover that the HOA was never formed, or has lapsed. Such transfers can be delayed by weeks and months because then we have to scramble, to re-establish the HOA and ensure that someone is appointed and authorised to sign the consent form.
- Apply for and obtain rates clearance figures from the local authority, and upon receipt, convey this to the seller and call for payment. Upon receipt of payment, we pay this to the council and obtain a rates clearance certificate which is required by law.
- Assuming the buyer is financially prepared, we receive our costs and pay transfer duty to SARS. Obtain a transfer duty receipt. Here is where we hope that the seller or estate agency does not have any issues with SARS!
- Call for compliance certificates (without which we may NOT register the transfer).
- Prepare deeds for lodgement by checking draft title deed against existing one.
- Liaise with bond registration attorneys/bond cancellation attorneys (if the property being sold is also bonded); linked transfers, to agree on lodgement date.
- Lodge deeds at the deeds office.
- Anything from 7 or so working days to around 10 working days after lodgement the deeds will “come upon prep”. They may have “notes” raised by the examiners which may take a day or two to attend to. If this is the case, and once we have attended to the address. We have 5 working days (including the day the deeds come up on prep) to “hand in”, and then we register on the following day. Currently, in the CT deeds office, we are receiving the original title deeds returned to us within 3-4 working days after transfer to be delivered for onward transmission to the new owner (if it was a cash deal) or the bank (if the property was bonded). This turnaround time varies month to month.
Things that commonly delay transfers
- If either party is not available to sign the transfer documents; sale agreements containing errors that require surgery by us!
- If the managing agent of a sectional title / HOA delays in providing the required consent / City Council delays in providing rates clearance figures, or if the seller disputes any arrears that council is claiming; HOA’s that have lapsed.
- If either party delays payment of (for example):
- Advance rates collection required (payable by the seller) to obtain a rates clearance certificate which is compulsory.
- Transfer duty by the buyer (a transfer cannot be lodged without a transfer duty receipt being issued by SARS).
- Delays in presenting guarantees where it is a cash buyer.
- Attending to repair work to the property that may have been made a condition of sale, before transfer.
- If the seller is in arrears with his / her bond and the selling price will not leave sufficient net residue (after paying the agent’s commission) to settle the bond, this will always delay matters significantly because the bank must first decide whether it will write off the loss or whether it will insist on the seller signing an Acknowledgment of Debt.
- Failure by the seller to arrange for compliance certificates.
- Lost original title deeds.
- Change in marital status or death. So, keep your buyers and sellers alive for heaven’s sake! 😎