If you are deciding to sell your property these tips will come in handy:
What you need to know about canceling your bond:
If you are a seller with an existing bond over your property, you must give their bank at least 90 days' notice of the bond cancellation. Penalties are payable for the early termination of a bond. Fortunately, this time period works well with the industry-standard period of 90 days for the transfer to take place into the buyers' name. It is easy to coordinate the transfer process and the cancellation notice needed.
The seller must ensure that bond cancellation figures are requested by the transferring attorney as this marks the initiation of the 90 day cancellation period.
The National Credit Act allows banks to charge this fee if a seller cancels their bond before the end of the 20-year loan period. Canceling a bond within the first two years of the loan agreement means a penalty interest of approximately 1% of the amount owing can be charged to the seller. This amount will be paid from the proceeds of the sale.
As a part of the transfer process, the conveyancer collects the relevant documents and applies for the cancellation figures from the bank. Only from this point, the 90-day period begins. Where loans are canceled within the 90-day notice period, pro-rata interest is charged on the remaining days.
Bank policies also change from time to time, so it is important to ask your selling agent about the latest regulations. Wallett and Finch Properties advise our clients to state in the offer to purchase that transfer may not be registered before this 90-day period has passed, ensuring the seller will not have to pay the early termination penalties.
If you are thinking of selling and need assistance or advice please contact us at email@example.com or Nadia Wallett on 0722410001.