Glossary
Legal terms explained.
To help you understand the Conveyancing Process, please refer to our glossary
A legal practitioner who specialises in attending to the transfer of ownership of immovable property. This attorney will apply for the clearance figures at the municipality & HOA/ Body Corporate, obtain the transfer duty receipt from SARS and attend to the special conditions in the title deed. The transfer attorney communicates all the necessary to the bond and bond cancellation attorney.
A legal practitioner attending to the registration of the bond in favour of the bank. The bond attorney is appointed by the bank that is granting the home loan for the purchaser.
A legal practitioner attending to the bond cancellation of the Seller’s current bond (if the property is bonded). The bond cancellation attorney is appointed by the bank.
The document whereby the Seller and Purchaser (Buyer) agree to the sale of a property. It is a legally binding contract, so it is important to take your time and complete it accurately and make sure all the conditions portray the intention of the parties.
Bond Originator is a person who helps the purchaser procure a bond on their behalf, i.e obtain a homeloan. They essentially act as an intermediary between the purchaser and the banks, assisting them in compiling one set of paperwork, and then submitting the home loan application to all the major banks on their behalf.
The Financial Intelligence Centre Act (”FICA”) requires attorneys to establish and verify clients’ identities to combat money laundering and the financing of terrorism. The documentation requested by the attorney is required in order to comply with the obligations set out in FICA.
Bond Cancellation Figures are the settlement figure issued by the bank which your transfer attorney will apply for when the property is being sold and the bond needs to be cancelled. This amount is based on you continuing to make normal repayments on the home loan during the cancellation process. This amount includes the outstanding amount, interest due, services fees and possibly penalties if 90 days’ notice was not given to the bank before the cancellation took place.
The seller is responsible for making sure that all outstanding amounts owed to the Municipality, is settled before transfer of the property takes place. The transfer attorney will apply for the rates clearance figures and give it to the seller for payment. This amount includes all outstanding debt as well as figures equal to two months in advance. The transfer attorney must obtain a rates clearance certificate in order to lodge in the Deeds Office.
The Seller is responsible for making sure all outstanding amounts owed to the HOA or Body Corporate are settled before transfer can take place. The Transfer Attorney will apply for these figures and send it to the Seller for payment. A Levy Clearance Certificate will then be issued which confirms that all amounts owing by the owner has been paid in full. The balance normally includes one month’s of charges and levies plus an admin fee for the issuing of the certificate by the managing agent of the body corporate or the HOA.
collective name given to the owners of the units and common property within a sectional title scheme. Monthly levies are payable by each owner to the body corporate. The body corporate normally appoints a managing agent to administrate its affairs. The transfer attorney will apply for a levy clearance certificate and HOA consent to transfer the property before lodgement. The levy clearance figures are payable by the Seller.
Homeowners’ Associations (HOA) are formed by property owners in full title or freehold housing establishments. Monthly levies are payable my the owners. The transfer attorney will apply for a levy clearance certificate and HOA consent to transfer the property before lodgement. The levy clearance figures are payable by the Seller.
A guarantee is a bank undertaking in favour of a third party (the transfer attorney) at the request of the bank’s client (the purchaser). This form of undertaking secures the purchase price so that it will pay out to the transfer attorney on registration of the property into the purchaser’s name.
Bond Cancellation Figures are the settlement figure issued by the bank which your transfer attorney will apply for when the property is being sold and the bond needs to be cancelled. This amount is based on you continuing to make normal repayments on the home loan during the cancellation process. This amount includes the outstanding amount, interest due, services fees and possibly penalties if 90 days’ notice was not given to the bank before the cancellation took place.
Transfer Duty is a tax payable by the purchaser to SARS for the acquisition of a property. This amount must be paid to the transfer attorney by the purchaser before lodgement in order for the transfer attorney to obtain a transfer duty receipt which must be lodged in the Deeds Office.
- Transfer Costs- payable by the purchaser and normally includes the transfer duty payable to SARS;
- Bond Costs- payable by the purchaser to the bond attorneys upon request;
- Bond Cancellation Costs- payable by the Seller to the Bond Cancellation Attorneys.
Prior to registration, the Transfer Attorney must collect the relevant compliance certificates from the Seller. Depending on what is required by law and has been agreed to in the Deed of Sale, the Seller may be obliged to deliver an Electrical, Beetle, Gas Installation and Electric Fence Compliance Certificate. In Cape Town, the Seller will also be obliged to deliver a Water Installation Compliance Certificate to the City of Cape Town if the property falls within the jurisdiction of the City of Cape Town. It is important that the COC’s be attended to as early as possible in the transfer process as the purchaser’s Bank may insist on receiving copies thereof before they will grant the Bond Attorney permission to lodge their transaction at the Deeds Office. It is also important that these compliance certificates are issued by licensed and reliable contractors, as the Purchaser’s Bank will not accept certificates that have been issued by unlicensed contractors.
Deeds Office is a branch of the Department of Agriculture, Land Reform and Rural Development and is responsible for the accurate examination, registration and record-keeping of all property transactions. Only a Conveyancer can appear before the Registrar of Deeds to transfer property. It also keeps copies of antenuptial contracts.
Lodgement entails simply handing the entire batch of documents (i.e: the transfer, bond and bond cancellation documents) in as one batch to the Lodgement Counter. This is done in the morning.
Preparation Deeds sent to preparation (“prep”) are ready to be executed (registered). Deeds may still have notes, but these will be minor queries which do not warrant the rejection of the entire batch. Deeds can be “on prep” for five days before they will be rejected again if not registered in time.
Registration means that the property or bond has now been registered in the new owners name and the seller’s bond has been cancelled (if applicable)- this all happens simultaneously. The Registrar has now signed the new deeds reflecting the new owner’s name.
A legal deed or document constituting evidence of a right, especially to ownership of property.
