What could affect or delay an HOA Home Transfer

09 October 2018

When a property is sold, there is a specific list of documentation the conveyancing attorney will need in order to lodge the transfer at the Deeds Office, i.e. compliance certificates, rates clearance, bond documentation, etc.

If any item is missing or there is an error on any of the documents, there will be delays. There is no getting around this, says Nelio Mendes, marketing manager of SAProperty.com, and the best thing to do to ensure a timeous transfer, is to ensure everything is checked and in order beforehand.

Conveyancers will not look for unnecessary work, and will never ask for more than what is required, nor can they 'bend the rules' and try get the transfer through without the right paperwork, he said.

Sellers of properties in estates that are run by Homeowners' Associations, need to ensure that their levies are up to date (paid up to the date of expected transfer) as well as any other accounts linked to the property, such as rates and municipal bills.

The HOA can effectively block the transfer of the property to the new owner until their accounts have been paid in full by holding back on the issuing of the clearance certificate.

In addition, if there are any disputes sitting with the HOA, such as breach of conduct rules, these would need to be settled as soon as possible. Some HOAs have been known to want to settle the fines charged before they will issue a clearance certificate.

HOAs also have the power to decide, even if the seller of the property was declared insolvent and the property has formed part of an estate under administration, whether to block the transfer or not. If the liquidators want to sell and transfer an estate property to help pay an insolvent owner's creditors, they must first pay the HOA what is outstanding and obtain a levy clearance certificate - or negotiate with the HOA before they proceed with the sale.

It pays, therefore, to get accounts and any disputes with the relevant HOA settled before putting a property on the market, so that there is nothing that can impede the transfer once it is sold, said Mendes.

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