Six Steps to Prevent Property Transfer Delays

This Conveyancers, the Deeds Office or the City Council are often blamed for the delays in transferring properties. This criticism is well founded, however, delays can often be prevented if sellers take certain steps before selling their property.

Paul Stevens, CEO of Just Property, says that sellers must check that these steps have been taken and prepare themselves accordingly before they become an issue. The idea that they can somehow be sorted as the sale progresses is invariably wrong – going ahead without observing these essential issues can delay and jeopardise the sale agreement.

Just Property has provided these six steps to prevent property transfer delays:

• Ensure all rates are paid up. The City Council will not issue a rates clearance certificate until all outstanding rates and services have been paid, together with the payment of advance rates and services. A property cannot be transferred without a valid rates clearance certificate. If the seller is in arrears with their rates or cannot afford payment of the required advance amount; then they will either have to obtain bridging finance or a short-term loan.

• If the seller has no bond, ensure that he or she has the property’s original title deeds. (If there is a bond the original will be lodged with the bank). Title deeds, however, have the tendency to disappear. When they are lost the conveyancer will need to apply for a copy at the Deeds Office, which costs money and takes time.  Therefore, be sure as sellers, to take note of the whereabouts of your original Title Deed. If you cannot find it, immediately instruct a conveyancer to apply for a registration copy at the Deeds Office to avoid potential delays.

• Ensure all outstanding bond payments are paid up in full. Give the bank sufficient notice when you intend to sell and to cancel the bond. If this is not done, the bank is entitled to charge a penalty fee for early termination of the bond. Furthermore, if you as the seller, are aware that your bond settlement, together with all other costs, will be more than the purchase price (and result in a shortfall situation), then please make the conveyancer aware of this fact as soon as possible so the necessary steps can be taken with the bank to prevent any further delays.

• If the unit is part of a sectional title complex, make sure that you have a copy of the latest financial statements (annual accounts) and the management and conduct rules of the body corporate before you sell your unit. The bank the purchaser has applied to for a bond will require these documents before they grant the loan. Often a purchaser will want to see these documents before they put in an offer. In some cases the body corporate’s financials are not up-to-date and this may lead to the deal not going through. It is important, as a seller, to do your homework before you sell your unit.

• If the seller is in a sectional title unit, gated community or a similar development, it is important to sort out any issues with the homeowners association or body corporate regarding levies or certain living and design guidelines, before signing a sale document. There is often a title deed requirement that such an association must consent to the sale. If there is a dispute between the association and the seller, they may be entitled to withhold such consent, until the dispute is resolved to their satisfaction.  Therefore, sellers must make sure that disputes are resolved with such an association before the property is sold. It will be unfair to the purchaser if the transfer is delayed because of an existing dispute between the seller and the body corporate or homeowners association.

• Ensure you move out of your home by the agreed date. Do not try to delay this, especially at the last minute. Late handovers can cause many problems for the buyer, who has vacated his previous premises on time.

These steps are also not applicable to all sellers in every situation. A prepared seller is an essential ingredient to a smooth and successful transfer process.