Property Law (Conveyancing Practice)
This field in law describes the process whereby a person, company, close corporation or trust becomes the registered and lawful owner of fixed property and ensures that such ownership cannot be challenged. This also includes the application of a Mortgage Bond and several other areas.
A qualified Attorney in this specialized field usually is appointed by the Seller as the Conveyancer, but like all agreements this basic practice rule may be amended by agreement. The first requirement is a valid sale agreement. The Alienation of Land Act, 68 of 1981 provides that no transaction relating to a purchase or sale of immovable property will be valid, unless it is in writing and signed by both the purchaser and seller or their agents who have been given written authorization to sign on their behalf. The Sales Agreement then gets delivered to the Conveyancer who will then draft the necessary documentation. This process could take some time and this will depend on all of the different institutions involved, productivity rate and your assistance in this matter.
What are the costs involved?
Three categories can be referred to (bearing in mind that this is not a closed list and may vary depending on each case and its merit):
Transfer Duty or VAT: A specific formula is used to calculate this amount and this will be paid to SARS.
Rates and Levies
These amounts must be paid in full on date of transfer. This may include a pro rata portion of the charges payable on the fixed property to the relevant local authority or the levies payable to the Body Corporate in the case of a sectional title unit. It can take quite some time to receive the different clearance certificate and it should be noted that this is not within the control of your Attorney, but rather by the council or body corporate.
The conveyancers’ fees are calculated on a sliding scale and the purchaser is usually liable for this payment including Vat where applicable.
Bond Registration Costs:
The conveyancers’ fees are calculated on a sliding scale and the purchaser is usually liable for this payment including Vat where applicable. There may be certain amounts payable to the Receiver of Revenue as well.
Bond Cancellation Costs:
If there is already a bond registered over the property to be sold, one should bear in mind that this bond will have to be cancelled before transfer can take effect. The Seller will be liable for this payment. The conveyancers’ tariff will once again be calculated on a sliding scale and Vat will be payable if applicable. It is crucial to assess what this amount will be on the date of transfer as this could have a severe impact on your profit, if any.
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