SA Affordable Housing May - June 2020 // ISSUE: 82 | Page 32

FINANCE MATTERS
Property repossession and
the process of a sale in
execution: Part 2
By the Banking Association of South Africa
An important feature of a home loan (mortgage) agreement is that a debtor
(mortgagee) agrees that they will put up their home (property) as security for
the repayment of the loan to the bondholder (often a bank) that granted the
bond over their property. Sales in execution are considered as an exception to
the norm and are only used by banks as an absolute last resort when all other
avenues have fully been exhausted. This is the second of a two-part article.
THE FINAL OUTCOME
Although an SIE represents a final outcome of the auction
as it is not subject either to the debtors or the bondholder’s
approval, it may, however, be subject to the demonstrated
ability of the highest bidder and potential buyer’s ability to
meet the terms of the auction.
After the SIE the sheriff is responsible for making sure that the
highest bidder pays the purchase price agreed at the public
auction and once this is done the sheriff must make sure
that the property is transferred into the name/s of the new
mortgagee/s. If the amount (purchase price) raised at the public
auction is not enough to cover the debt owing by the debtor to
THE LEGAL PROCESS OF A SALE IN EXECUTION IS HIGHLIGHTED HERE:
Source: Socio-Economic Rights Institute (SERI)
30 MAY - JUNE 2020 SAAffordHousing saaffordablehousingmag SA Affordable Housing www.saaffordablehousing.co.za