The purchase price is secured either by way of a deposit or a bank guarantee from the purchaser ’ s bankers ( within the time period stipulated in the Agreement ). The balance of the purchase price is paid on request by the conveyancers into their trust account .
Risk & Occupation Risk ordinarily passes on transfer , unless otherwise stipulated in the Agreement . This means that the seller is responsible for any loss to the property before transfer . If the Agreement stipulates that the purchaser will take possession before transfer , the purchaser assumes the risk . In this case , the purchaser will also become liable for all rates and taxes and other imposts , and will be entitled to any benefits derived from the property , such as occupational rent .
If the purchaser occupies the property before transfer , then occupational rent is due to the seller .
Transfer & Transfer Fees The purchaser is liable to the conveyancers for payment of transfer fees , transfer duty and all costs and fees in connection with the registration of the transfer of the property ( and any bond registration handled by the conveyancers ). The conveyancers are chosen by the seller . This avoids any potential conflict of interest .
Mortgage Bond Clause If the purchaser requires mortgage bond finance , this clause regulates the amount of mortgage finance required and dictates when the mortgage bond finance must be granted . The Agreement is ordinarily subject to granting of finance ( known as a suspensive condition ). If the finance application is unsuccessful , the Agreement becomes null and void .
Breach Clause This details the procedures to be followed if one party breaches the terms and conditions of the Agreement . The most common breaches are failure to pay the deposit and / or the balance of the purchase price on time and failure to produce the guarantees stipulated in the Agreement .
Other Suspensive Conditions & Continued Marketing Other than mortgage finance , the Agreement may be subject to other conditions ( such as the sale of the purchaser ’ s property ). In the case of other suspensive conditions , the Agreement may contain a “ Continued Marketing ” clause , which allows the property to remain on the market until the suspensive conditions are fulfilled . Should another acceptable unconditional offer be made to the seller prior to fulfilment of the purchaser ’ s suspensive conditions , the purchaser is given 72 hours to either fulfil or waive the suspensive conditions , failing which the Offer to Purchase lapses and the competing offer becomes valid and binding .
Commission The seller is liable for the payment of any commission to an estate agent against registration of transfer . If the Agreement stipulates the purchaser is to pay the commission , the fee is added to the purchase price when the transfer duty due to SARS is calculated .
26 APRIL 2021 SA Real Estate Investor Magazine