How Long Does Bond Registration Take in South Africa?

Registering a Bond in South Africa

If you are in the market to buy a house, or in the process of finalising the purchase of your new home, you might already know that you will need to complete the bond registration process as part of the requirements of buying property, unless of course you are paying cash for your new home. But how do you register a bond and how long does bond registration take in South Africa? In this article, we’ll be sharing some useful information about the bonding process that you need to know. 

A number of expenses inevitably arise during property transfers between sellers and buyers. Here is a list of payments that you may expect to pay as either a buyer or seller: 

The seller must pay the following expenses:

• Agents commission 
• All appropriate and necessary certificates of compliance 
• Bond Cancellation fees*
• Penalty Bond Interest*
• Advanced rates clearance figures
• Levies/Special Levies*
• Capital Gains Tax 
• Home-Owners Consent*
• Certified Copy of misplaced Title Deeds*
• Advertisement costs for misplaced Title Deeds*

The buyer must pay the following expenses:

• Attorneys Transfer fees 
• Transfer duty/VAT
• Bond registration Fees*
• HOA Consent Fee*
• Body corporate levy clearance Fee*
• Fees in terms of special bond conditions*
• Occupational interest*

How Long Does Bond Registration Take in South Africa?

If you are starting the bond registration process in South Africa, you can typically expect the registration and transfer of your bond to take a minimum of three months. However, it is worth mentioning that this timeline can vary quite a bit, depending on the circumstances of the property transfer. While some properties can be registered within two months, others have been less fortunate, waiting several months for the transfer to be concluded. To better understand why bond registration takes as long as it does, it might be useful to have a basic understanding of the bond registration process and the requirements that need to be met to conclude a property transfer.

The Bond Registration Process

1. The bank issues a bond instruction to the attorney – The bank will appoint a bond registration attorney to register a mortgage bond over the property as security for the bank once the purchaser’s loan application has been accepted.
2. Enquire with the transferring attorney about the draft deed and the guarantee requirements – Because the documentation for both the transfer of the property and the registration of the bond should be registered at the same time at the deeds office, the bond attorney will work with the transfer attorney to offer guarantees for the purchase amount or a portion of it.
3. Prepare the bond documentation for signing – The bond attorney will draft the bond documentation for the purchaser to sign.
4. Acquiring certificates of insurance – The bank mandates that the purchaser ensure the construction of the bonded building. The purchaser must supply the bank with insurance coverage in the amount of the bank’s replacement amount. 
5. Bond registration fees are due – The bond registration fees must be paid to the bond registration attorney by the purchaser.
6. Guarantees are issued – After the purchaser signs the bond paperwork, the bond registration attorneys will issue guarantees to the transfer attorneys, securing payment of the property’s purchase price (or a portion thereof).
7. Submit documents to the bank for verification and obtain permission to proceed with the filing – The signed paperwork is sent to the bank for verification once all of the bond documents have been signed and the bank’s conditions, such as the building’s insurance policy, have been met. The bank will next provide their approval to continue with the mortgage bond filing at the deeds office.
8. File with the deeds office – The bond paperwork will be sent to the deeds office for registration after all of the documentation is in order. If there are multiple attorneys working on different aspects of the transaction, their documents will be linked and lodged at the same time as the bond registration attorney’s documents, which can include the consent to cancel the seller’s existing mortgage bond on the property and the transfer documents prepared by the transfer attorneys.
9. Registration – Examination in the deeds office typically takes 10-12 working days from the date of lodgement, following which the papers are placed on preparation, indicating that the examination process is complete and registration may commence. The deeds office releases the registered title deed and mortgage bond, which are subsequently submitted to the bank as security for the bank’s loan to the buyer.

Factors That May Delay the Registration of a Bond 

There are a number of reasons why the bond registration process may be taking longer than expected. Challenges can arise during the bond application, as well as during application for rates clearance certificates and transfer duty receipts. 

Factors That May Delay Bond Registration: 

• The buyer or seller have failed to provide personal information
• The seller has not provided the details of the bank where the existing bond is held 
• Tax compliance issues 
• Non-compliance with certain clauses in the offer to purchase 
• The bond approval conditions not being met 
• The existing bondholder failing to provide cancellation figures and title deeds to the transferring attorney
• Clearance certificates or rates figures have not been received 
• The required deposit has not been paid by the purchaser
• Delayed provision of guarantees
• The buyer failed to make payment for the bond and transfer costs when due 
• The seller has not signed the transfer documents
• The buyer has not complied with all of the requirements stipulated by the bank
• The purchaser has not signed the relevant transfer and bond documentation 
• When the bond, transfer and cancellation attorneys are from different law firms

Alan Levy Attorneys – Conveyancing Attorneys in Johannesburg

Speak to our experienced Conveyancing Team. For any enquiries related to your property and transfer process, please contact our conveyancing team at Sonnette@alattorneys.co.za and conveyancing@alattorneys.co.za