reason , many Agreements of Sale contain an occupation date . From this date the purchaser pays the seller an agreed monthly occupational interest until registration of transfer . Should transfer take place during the month , occupational interest will be charged on a pro rata basis .
Where the Agreement of Sale specifies possession rather than occupation before registration of transfer , the purchaser must insure the property from the date of possession , as possession involves the passing of risk . Most insurances are linked to the registration of a bond . For this reason , possession usually passes on registration of transfer .
What Does the Transfer Process Entail ?
Once the transferring attorney has been nominated ( usually by the seller ), the attorney will :
1
Communicate in writing with both the seller and the purchaser and confirm in writing to the agent that they have been instructed to effect transfer .
2
Request FICA documents from both parties ( copies of identity documents , marriage certificates and antenuptial contracts , where applicable , proof of address , tax numbers , VAT numbers ( if relevant ) and , where transfer is being given or taken by a legal entity , the relevant documentation and resolutions of that entity ).
3
Request the title deed to the property from the seller or from the existing bond holder , if the property is bonded . The attorney will instruct the bond holder to cancel the bond as soon as possible after receiving the transfer instruction , as most banks require sufficient notice of an intention to cancel a bond . Failure to do so can result in the bank charging the seller a penalty for early cancellation .
4
Conduct a Deeds Office search to ensure there are no interdicts or attachments on the property . The transfer documents can then be drawn and the parties can sign the requisite documents .
5
Write to the local authority to assess outstanding rates on the property and obtain a Rates Clearance Certificate , which will be lodged with the transfer documentation in the Deeds Office . The rates year runs from 1 July to 30 June of each year and the attorney will collect pro rata rates from both the seller and the purchaser . The purchaser is ordinarily obliged to pay the rates three months in advance from the anticipated date of occupation / transfer .
6
Collect transfer duty from the purchaser , which will be paid over to SARS . The transfer duty receipt must be lodged with the transfer documents .
7
Ensure all transfer documents are correctly drafted and ready for lodgement at the Deeds Office , and where there is a linked transaction ( i . e . the cancellation of the seller ’ s bond , the registration of the purchaser ’ s bond , or a linked transfer ), ensure all linked parties lodge their documents at the same time , so transfer can take place simultaneously .
8
If the transfer is a sectional title transfer , liaise with the body corporate or homeowners ’ association to obtain a levy clearance certificate and a consent to transfer ( if the title deed contains a restriction against transfer without the prior written consent of the body corporate or homeowners ’ association ).
SA Real Estate Investor Magazine MAY 2021 23