How much do you really know about the home buying process? Sure, house hunting is fun and playing with online calculators does give you an idea of how much house you can afford. But what should you know before you even sign an offer to purchase?
5 Selling, attorney’s role and costs
If any of the funds for the purchase of your new property are to come out of the sale of your current property, or if you simply cannot afford to pay two bonds, you can make the offer to purchase subject to the successful sale and registration of your current property. It may also be that the bank to which you apply for a loan makes this a prerequisite.
In general, sellers are not inclined to simply accept offers that are subject to the sale of properties. There are, however, legal provisions that can be written into an offer in order to encourage the seller to accept your offer. The wording of these provisions in purchase contracts can be the cause of great unhappiness between you and the seller.
You must go through the wording of these clauses carefully and make sure that you have sufficient time to comply with the suspensive conditions.
If your offer is subject to bond approval as well as the sale of your current property, you should note that you must apply for your bond immediately and should not wait until the sale of your current property has gone through successfully before you start applying for your bond.
If the bank grants the loan, you will be protected because the registration of such a bond is subject to the sale and registration of your current property.
The transferring attorney is the law firm responsible for the transfer of the property into the name of the purchaser.
This attorney must ensure that the parties comply with the terms of the deed of sale and, if not, that the necessary steps are taken to enforce the terms. This law firm also drafts all the legal documents and oversees the signing thereof. Furthermore, it is their responsibility to obtain the transfer duty receipt and the city council (and HOA and sectional title, if applicable) clearance certificates. Your deposit will be held in trust by this law firm and they will deal with all the financial aspects of the transaction. This firm must coordinate lodgement of the documents at the deeds office once they are satisfied that all legal and contractual requirements have been met.
For a complete explanation of the costs payable by the purchaser, please use the MCostcalculator.
All fees and expenses mentioned in this category are payable by the purchaser. The term transfer costs refers to the costs that are payable in order to transfer the property from the seller to the purchaser. This component includes, among other things, transfer duties and the transferring attorney’s professional fees, as well as certain other expenses.
The professional fee is linked to the value of the property that is being transferred. The Law Society issues a guideline of fair and reasonable fees to which we adhere. There are also a number of administrative charges and fees that are payable.
Bond registration costs
All fees and expenses mentioned in this category are payable by the purchaser. The term bond registration costs refers to the registration of the purchaser’s bond (if applicable). The costs include the professional fees of the conveyancer and other expenses. This fee is linked to the amount for which the bond is registered. The Law Society issues a guideline for what is a fair and reasonable fee, which we adhere to.
Next time: Understanding defects; reading up on the homeowners’ association rules; and knowing your fittings from your fixtures