Bonds

Bonds

Once a conveyancer receives a mandate to register a transfer of immovable property, he performs a deed search on the particular property.  These searches indicate all the particulars of the property, including the history thereof, whether or not there are/were interdicts on the property and if there are any current bonds registered over the property.

In the event that there is a bond registered over the property, the conveyancer has to contact the mortgagee to ascertain what the outstanding balance on the bond is and to inform the mortgagee that he has received instruction to transfer the property.

Meanwhile, the mortgagee (usually a bank) instructs a conveyancer (not necessarily the transferring conveyancer) to draft the bond cancellation documents.  The bank/mortgagee then also provides the original bond and title deed to the bond cancellation conveyancer.

The transferring conveyancer provides the cancellation conveyancer with a guarantee for payment of the outstanding bond balance so that the existing bond may be cancelled and the transfer of property may be registered.

Should the purchaser require financing for the purchase price, he may approach a bank or similar financial institution directly.  After his application for a bond has been approved, the mortgagee/bank will instruct a conveyancer of its choice to attend to the registration of the bond.  The bond conveyancer prepares all the necessary documents and arrange signing thereof with the purchaser, who is also liable for the costs of registering the bond.

 

Lodgement at the Deeds Office

All registrations in connection to the same transaction, e.g. the transfer, bond cancellation and bond registration, must be lodged simultaneously at the Deeds Office in one set.  As soon as all the parties (transferring conveyancer, bond cancellation conveyancer and bond registering conveyancer) to the transaction have met their separate requirements, they arrange with one another to lodge the registrations together on the same day.

After lodgement, the set of deeds go through various levels of examination and should be available at “prep” (preparation for registration) or within 10 (ten) business days. The examiners note any possible errors on the deeds, to be corrected before registration thereof, and may reject the deed if the error thereon is of such nature that it cannot simply be rectified by the conveyancer.  Deeds are often rejected if the correct form has not been followed, RCC has lapsed, applicable conditions have not been carried over from the previous deed correctly and if the deed does not comply with statutory requirements and regulations.

The conveyancers are now offered the opportunity to remove any notes which might have been raised by the examiners, to ensure all finances are in order and all requirements have been met, so the registration may take place.

The set of deeds may be kept at prep for 5 business days whereafter the Deeds Office will reject the deeds.  Once all the parties are ready to register the deeds, their set will be taken to execution on the following day, where they register it in the presence of the Registrar of Deeds.

It is important to note that deeds may not be taken out of the Deeds Office once it has been lodged and captured in their system.  There are certain procedures available, should the conveyancer wish to withdraw the deeds from the system formally.  After the deeds have been registered they are allocated to the conveyancer involved in the matter and may be removed from the Deeds Office.

Registered title deeds are then either given to the new registered owner or sent to the bank/mortgagee to be held in safekeeping until the bond is cancelled again.