You’ve found the perfect property, made an offer and been accepted. The next step, and sometimes one of the most frustrating, in your journey to owning a new home is the bond registration process. If you’re unfamiliar with the ins and outs of the process it may seem frustratingly slow and detail orientated- so here’s Annemarie Swanepoel Attorneys’ guide to what you need to know about bond registration for a smooth, simple process.
The bond registration process may be where it all seems to slow down and get ‘boring’. You’re done viewing properties and chasing up offers. Now it’s time for the ‘legalese’ and official red tape.
Bond registration sees the seller, you, your agents, and three attorney roles all meet in the middle. There’s an attorney who will oversee the transfer, the bond attorney, and a cancellation attorney. This can, depending on the circumstances, be the same attorney.
The transferring attorney is one appointed by the seller, and their role is to ensure the property is removed from the seller’s name and placed into yours. The cancellation attorney, of course, is the face of the bank which holds the seller’s mortgage on the property. They ensure that the seller’s debt to the bank is discharged and their now-irrelevant bond cancelled. The bond attorney does the opposite- they ensure your new bond on the property is opened and created, and will be appointed by your mortgage lender.
You will have already made an offer to purchase, and found yourself the best possible loan offer for your new mortgage. Once you are happy with an offer, the registration process begins. This part of the process typically lasts about 8 weeks. Once it is complete, and you have a mortgage bond in your name, the transfer attorney can step in. They will ask for several records- the municipality needs to give a statement of rates and taxes, and the seller’s bank will provide the title deed and any outstanding amounts owed to them by the seller [cancellation figures]. The cancellation attorney will need a guarantee that this outstanding amount will be settled, then you and the seller will sign the transfer papers in their presence. This is where transfer costs will be paid- covering the transfer duty and rates and taxes.
This may seem lengthy, but you are almost done. Now the bond attorney will have you, as the purchaser, sign the mortgage loan agreement and other associated documents. These will then be lodged with the deeds office. After roughly three weeks, you will be ‘issued the rates of clearance’, meaning all documents are correctly lodged for the transfer by all legal parties.
This means the bank can finally pay out your mortgage loan in accordance with the guarantees you have in place. Any outstanding debt of the seller’s is removed, and the property is yours.
While the process may seem overwhelming, especially as you will be receiving information about your mortgage repayments and such at the same time, it’s actually a fairly logical procedure, and your attorney will be there to help you handle every step of the procedure.
While it’s tempting to forget about the process, grit your teeth and ignore it just from frustration due to the length of time taken, rather stay in touch with your attorney so you know how the process is progressing. The team at Annemarie Swanepoel Attorneys are always happy to help with any queries you may have.