Act

An act is a law passed by government.

Addendum

An addendum is a further agreement to an original sale contract covering points agreed to afterwards.

Agent's Commission

A fee charged by an estate agent for the service rendered by the agent to a seller for selling the property of the seller. Estate agents usually have to pay VAT on their commission. The seller pays the commission on registration of the property into the name of the seller.

Antenuptial Contract

This is an agreement entered into by parties prior to getting married. The agreement will regulate the affairs of the parties both during and after the marriage. The parties will then be married out of community of property.

Articles of Association

This document forms part of the constitution of a company.

Assessment Fee

This is the amount that the bank charges to assess the property prior to granting bond finance.

Assessor

An assessor values the property usually on behalf of the lending bank.

Attorney

An attorney, also known as a lawyer, is an academically and professionally qualified person who must also be enrolled to practice law. An attorney may become a conveyancer if he has received the professional qualification as a conveyancer. See Conveyancer.

Bank Administration Fee

The bank charges a monthly administration fee to handle your home loan.

Bank Assessment

A bank assessment is the bank's assessed valuation of the property.

Bond

The full description of a bond is a mortgage bond which is a security a bank or money lending institution has registered over a property for which it lends money to be purchased. The bank or institution will have preference in having the property over which the bond is registered sold to recover the money it lent over any other creditors in case the borrower does not make repayments on the bond.

Cancellation Attorney

The cancellation attorney or conveyancer is appointed by the bank, which holds the current mortgage bond over the property. This attorney attends to the cancellation of the seller's bond.

Cancellation of Bond

A bond is officially cancelled when the debt owing is paid in full and the cancellation is registered at the Deeds Office. A fee is payable to the conveyancers by the owner of the property.

Cancellation Figures

Cancellation figures consist of the outstanding amount on a home loan being cancelled, as well as the interest and any other costs required to settle the home loan.

Capital Gains Tax

This tax is levied on the resale of assets. All taxpayers, including individuals, trusts, companies and corporations, are taxed on the profit they make from the sale of assets of a capital nature. It is not applicable to the primary residence of any person i.e. if a person owns more than one residence this tax does not apply to such person's main residence and if a person owns only one residence then the tax will not apply at all.

Capital Redemption on Bond Repayments

Capital Redemption means to repay a capital amount as well as the interest amount on monthly bond repayments.

Cession of Insurance Policy

Where borrowers have to take out life assurance to cover their bond repayments, the borrowers may use existing policies and in this case they will have to sign a cession document ceding or giving the policy to the bank as security for the bond repayment in the event of the death of the borrower

Close Corporation

A close corporation is similar to a company but only natural people can be members of a close corporation and the number of its members is limited to ten.

Cluster Home

A freehold property in a development of similar houses, usually with good security and limited access. Each subdivided stand in the development is exclusively bought and individually owned.

Collateral

The amount of security provided to secure a home loan i.e. the value of the property.

Company

A corporate entity that can own property in its own name.

Compliance Certificate

An electrical compliance certificate issued by a qualified electrician is required by law for the property to be transferred to the purchaser's name. This, and any electrical repairs that need to be made, must be paid for by the seller. A beetle Infestation clearance certificate may also be required.

Conditions of Loan

Banks specify conditions of loan when granting home loans that borrowers must comply with in order to get the loan and to continue with the loan agreement.

Conditions of Title

Conditions of Title are restrictive conditions limiting an owner's rights over his property, which are recorded on the property's title deed e.g. building limitations and mineral right reservations.

Contract

See Deed of Sale.

Conveyancer

A conveyancer is an attorney or lawyer who is specially qualified to attend to the registration and transfer of immovable property, and the registration and cancellation of bonds. Although The words attorney or conveyancer may be used interchangeably when referring to conveyancing work it is important to note that not all attorneys are qualified conveyancers and only conveyancers may by law attend to conveyancing work

Conveyancing

Conveyancing is the legal process of obtaining ownership of a property. A written contract of sale of the property must first be signed by the Seller and the Purchaser. The property transfer process in order to pass and register the Purchaser's new ownership in the property then occurs at the Deeds office. Any mortgage bonds required to secure loans for the purchase price may be registered at the same time and any existing bonds may be cancelled.

Conveyancing Costs

These are the costs payable to the attorney appointed to attend to the transfer of the property from the seller's name into the purchaser's name.

Cooling-off Period

The cooling-off right is a right set out in the Alienation of Land Act giving a purchaser of a residential property, sold at a price of R 250 000.00 or less, the right to withdraw from the sale within five days of signing an offer to purchase.

Costs Clause in Bond

A cost clause is an additional amount that is added to the capital amount loaned for a bond to cover any additional costs such as legal fees, penalties, and repossession costs.

Debit Order

The required method of home loan instalment repayments. The purchaser instructs the bank to debit his account to pay his monthly bond instalments.

Deed

A signed and witnessed legal document that is used to create a legal rights and duties between parties such as to sell or transfer property or to cancel or register bonds. It is usually also the evidence of ongoing rights e.g. the right of ownership in property by a person.

Deed of Sale

The deed of sale, also referred to as the offer to purchase or agreement of sale, is a legal document signed by the purchaser and seller, whereby the purchaser agrees to buy a property from the seller, who agrees to sell the property to the purchaser. This agreement sets out the proposed purchase price and conditions on which the sale will take place. Once signed by all parties, it is a legal and binding agreement that the parties have to comply with.

Deeds Office

An office in a government department responsible for the registration of ownership and other rights in immoveable property i.e. land with or without buildings or other structures.

Deposit

n the deed of sale the parties can agree to a deposit, usually 10% of the purchase price being paid at the time the deed of sale is signed, to be paid to the conveyancing attorneys to be held in trust.

Disbursement

A cost which the conveyancer has to pay someone else on behalf of the person taking transfer e.g.deeds office registry fees

Fixtures and Fittings

These are items at the property which could be removed or left behind and which are either included or excluded from the agreed price. The seller and purchaser must agree as to what is included in the selling price.

Home Loan

A loan granted by a bank for the purpose of the purchase of property secured by a bond over the property in favour of the bank. See Mortgage Bond.

Loan Agreement

The contract that is drawn up by the bank and signed by the purchaser when a bond is approved and granted. It contains details such as interest rate, bank charges, insurance premiums and monthly instalments.

Mortgage Bond

A security a bank or money lending institution has registered over a property for which it lends money to be purchased. The bank or institution will have preference in having the property over which the bond is registered sold to recover the money it lent over any other creditors in case the borrower does not make repayments on the bond.

Mortgage Bond Fees

These fees are charged according to a standard tariff on a sliding scale depending on the amount of the bond.

Occupation

Occupation is the right to use and enjoy the property.

Possession

Possession is associated with the legal risk of loss or destruction of the property and the right to enjoy the benefits associated with the property.

Rates Clearance Certificate

A certificate issued by municipalities to indicate that municipal rates are paid up and accordingly that the transfer may be registered. It may also be issued by the body corporate in the case of a sectional title property unit.

Sale Agreement

The sale agreement is also referred to as the offer to purchase or deed of sale. It is a legal document signed by the purchaser and the seller, whereby the purchaser agrees to buy a property from the seller. Any sale, donation or exchange of land in South Africa must be in writing to be valid. The agreement must specify the purchase price and conditions on which the sale will take place. Once signed by all parties it becomes a legally binding agreement.

Sectional Title

A property arrangement by which each property in the complex of homes is individually owned but there are areas commonly owned and a body corporate to regulate matters of common interest.

Survey Diagram

This is a diagram registered at the office of the Surveyor-General depicting the property.

Suspensive Condition

A suspensive condition is a clause in a contract whereby the validity of the contract is made subject to a condition being fulfilled e.g. the granting of a bond by a bank before a certain date. Only if and when the condition has been fulfilled will the contract be fully valid.

Title Deed

This is the document proving ownership of the property to the person whose name appears on the deed. It is also known as the transfer deed which is the document that passes the ownership of the property from the seller to the purchaser at the Deeds Office. The deed sets out any conditions, rights or obligations that affect the property. If there is a bond over the property then the bank or building society holding the bond will hold the title deed.

Transfer Deed

See Title Deed.

Transfer Duty

This is a duty payable to the Receiver of Revenue on transfer of property calculated on a standard tariff depending on the value of the property.

Transfer of Property

See Conveyancing.

Voetstoots

This is a clause almost always inserted in the deed of sale which means the property is sold 'as is' and that the seller is not liable for any defects later discovered by the purchaser if the seller was not aware of them at the time of the sale.