On paper, the term “conveyancing” refers to the transfer of a property’s ownership from one individual to another. In practice, however, conveyancing is more of a finely choreographed dance that occurs between multiple stakeholders. Many of these stakeholders have conflicting interests but all of them have to coordinate with complete precision to allow for a successful transfer to take place. Everyone from the buyer and seller to the estate agent, mortgage lender and mortgage originator has a vested interest in seeing the transfer take place as quickly and efficiently as possible, which is why delays at any point in the process can be extremely frustrating for all involved.
When all stakeholders are aware of the correct sequence of events that make up the conveyancing process, it becomes much easier for each individual to monitor the process accurately and understand their unique position and role in “the dance”.
Most people are under the impression that only one transferring attorney or conveyancer is responsible for transferring a property. In reality, the conveyancing process could involve up to three attorneys, each of which has a distinctive function:
- The transferring attorney will attend to the transfer of the property.
- The bond registration attorney will attend to the bond registration.
- The cancellation attorney will attend to the cancellation of the existing bond.
Conveyancing by numbers: 12 steps to a successful transfer
Step 1: The buyer agrees to buy the seller’s property by signing an offer to purchase
Once a buyer has signed an offer to purchase, the estate agent in charge of the sale will present the offer to the seller. If the seller approves the offer, he will sign the offer to purchase and in so doing set the conveyancing process in motion.
Step 2: The transferring attorney receives their instructions from the seller
Upon receiving instructions, the transferring attorney will immediately apply for rates and levy clearance figures as well as bond cancellation figures if a bond is registered over the property that is being sold.
Step 3: The bond originator applies to the bank for a home loan to cover the purchase price of the property
An offer to purchase usually contains a condition that allocates a specific period in which the buyer can obtain a loan to purchase the property, failing which the contract will lapse. To help speed up this process, a buyer may choose to enlist the services of a bond originator.
Step 4: The seller gives his Mortgage Lender instructions to cancel the existing bond
Within 10-20 days of receiving their instructions, The Mortgage Lender will instruct cancellation attorneys from their panel to cancel the bond and liaise with the transferring attorney.
Step 5: The bank approves the loan and instructs the bond registration attorney to register the new bond
Once a bond has been approved, a bond registration attorney is appointed by the bank. The transferring attorney will make contact with the bond registration attorney and provide certain documents. Bond registration attorney will draft the bond documents for the buyer to sign and request payment of their bond registration fees.
Step 6: The seller and buyer sign documents
The buyer and seller will sign their respective transfer documents. The transferring attorney will request payment of the rates and levy clearance figures from the seller as well as the cancellation fees. The buyer will receive a pro forma statement from the transferring attorney
Step 7: The transferring attorney pays the rates, levies and transfer duty to SARS
In order to obtain the rates- and levy clearance certificates as well as transfer duty receipt required as supporting documents by the Deeds Office, the transferring attorney makes payments to the Municipality, Body Corporate and SARS on the seller’s behalf.
Step 8: The bond registration attorney supplies guarantees to the transferring attorney
Once the buyer has signed the bond documents, including the all-important “Authority to Pay”, the bond registration attorney will issue the guarantees to the transferring attorney. The transferring attorney will then forward the original guarantee to the cancellation attorney.
Step 9: Lodgement occurs at the Deeds Office
It is essential that all three attorneys lodge their documents in the Deeds Office simultaneously. In the event that any of the three attorney is not situated close enough to one of South Africa’s 9 Deeds Offices to lodge their documents, they will forward their documents to a correspondent who has an office close to a particular Deeds Office to lodge the documents on their behalf.
Step 10: The Deeds Office examines the documents
Once all three attorneys have lodged their documents, either two or three examiners will examine the documents in order to establish that they have been drafted correctly and that all the supporting documents are in place. This is a very important part of the conveyancing process and it may take up to 10 working days to complete.
Step 11: Registration takes place
Once examination is complete and the documents are deemed to be in order, the Deeds Office will put the documents on “preparation” or “prep”. This means that registration can now take place. All three attorneys must coordinate to register simultaneously. As soon as registration takes place and the guarantees have paid out, all payments can be made.
Step 12: The post-registration phase
Once registration has taken place, the Deeds Office will microfilm the deeds and release them. This process takes up to two weeks to complete. Upon receipt of the original Title Deed it will be delivered to the Seller or the Mortgage Lender.
