SELLING YOUR PROPERTY: A FEW THINGS TO REMEMBER

Written by Cherise Hansen on January 11th, 2016. Posted in conveyancer, transfer of property

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We know that the selling of property can be a very stressful time in any person’s life and have set out a few things that you need to consider and be aware of when selling your property.

BOND CANCELLATION

Most people have bonds over their property that need to be cancelled before the property can be transferred to the new owner.

Did you know that the banks require 3 months’ notice of the cancellation of the bond?

If the banks are not given 3 months’ notice that you are selling your property and thus cancelling your bond, the bank will add 3 month’s penalty to your cancellation figures. This figure may be reduced depending on how long the transfer takes. Thus if the transfer takes 3 months you will not pay penalties but if the transfer takes only one month, you will pay 2 month’s penalties.

We would thus advise that once you make the decision to sell your property, that you immediately give notice to your bank so as to save yourself the penalties that would be payable to the bank.

RATES CLEARANCE FIGURES

Did you know that when you sell your property, you, as the seller are obliged to pay for the rates clearance figures?

As the seller you are obliged to make payment of the rates clearance figures which are usually calculated 4 months in advance (from date that the figures are issued by the city council). Included in the rates clearance figures are any rates and taxes, water and electricity and other charges payable on the property that are in arrears for the last 2 years.

These figures are payable upfront and if it is not paid, you will not receive the rates clearance certificate that is required for the transfer to be lodged in the deeds office.

In addition to this, if there are any arrears owing in respect of rates and taxes, water and electricity and other charges which is older than 2 years, the city council will also include these figures in the rates clearance figures. If you cannot make payment of all the arrears upfront when making payment of the rates clearance figures, the conveyancer will have to provide the city council with an undertaking that they will make payment of all the arrears older than 2 years to the city council upon transfer of the property. These funds will come from the proceeds of the sale.

Thus it is very important that you ensure that you have sufficient funds to make payment of the rates clearance figures as calculated in advance (4 months) plus the arrears for up to 2 years (should you be in arrears). Should you be in arrears for longer than 2 years, you need to ensure that you will receive enough money from the transfer (after paying your bond and the estate agent’s commission, if any) to make payment of the arrears to the city council.

It is advisable to immediately notify the conveyancer attending to the transfer that you are in arrears and that you may not have the money to make payment thereof, to enable them to advise you in this regard.

 If you own a sectional title, you will also be liable to make payment of the levy clearance figures which enables the conveyancing attorneys to obtain a levy clearance certificate.

ELECTRICAL CERTIFICATE OF COMPLIANCE/ ELECTRICAL FENCE CERTIFICATE/ GAS CERTIFICATE

As the seller, it is your responsibility to obtain these certificates. It is also your responsibility to fix any issues that may arise to enable these certificates to be issued. If you think that there may be any problems that may have to be resolved to have these certificates issued, it is advisable that you contact an electrician immediately to advise you what the costs would be. Many transfers are delayed as a result of electrical problems that prevent the issuing of these certificates and this can also be an unexpected costly expense to you, as the seller.

Other issues that you will need to consider carefully are: occupational rental and when the purchaser will take occupation; is the purchaser obtaining a bond; is the sale dependant on the sale of the purchaser’s property; and the like.

As the seller, you are able to nominate and choose the conveyancer who you would like to attend to the transfer.

Should you have any queries regarding the transfer process or should wish that we assist in drafting the offer to purchase or the transfer of your property, kindly do not hesitate to contact us herein.

FREQUENTLY ASKED LEGAL QUESTION

Written by Ronel Kruger on October 24th, 2012. Posted in capital gains tax, transfer duty, transfer of property

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Q: MANY YEARS AGO I BOUGHT A HOUSE WHICH I HAD REGISTERED IN THE NAME OF A COMPANY INSTEAD OF MY OWN NAME AS PART OF MY ESTATE PLANNING. THE COMPANY DOES NOT TRADE AT ALL AND HAS NO ASSETS APART FROM THE HOUSE. I NOW WISH TO SELL THE HOUSE AND I FOUND A PURCHASER WHO IS WILLING TO PAY R1 080 000.00 FOR THE PROPERTY. I UNDERSTAND THAT THE COMPANY WILL HAVE TO PAY CAPITAL GAINS TAX ON THE SALE BUT ONE OF MY FRIENDS TOLD ME THAT IF I FIRST TRANSFER THE HOUSE TO MY NAME AND THEN SELL IT NO CAPITAL GAINS TAX WILL BE PAYABLE – IS THIS TRUE?

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1st Floor, Block B, 37 Harley Street, Ferndale, Randburg.