A Property24 reader asks: “If a property has been registered, how long does it take for the purchase price to be paid over to?”.
Conveyancing Attorney, Denoon Sampson replies:
“Before the transfer documents are lodged in the Deeds Office the purchase price is always secured. This means that the conveyancer now is in control of the payment decision. This is particularly important because once ownership has been transferred into the name of the purchaser; the purchaser is simply not able to retract payment or stall making payment.
“When we say that the purchase price is secured, we mean that cash has been paid over to our trust account and that mostly bank guarantees have been issued. The payment of the bank guarantee is always triggered by the fact that the registration of transfer has been recorded in the Deeds Office.
“So the important point is that the conveyancer is always in control of the payment decision; nobody else can withhold payment.
“As to when payment is made to the seller. The process is as follows:
“The bank guarantee will pay out the money overnight; on the same date that the transfer was registered at midday. The conveyancer will find the proceeds of the guarantee in his trust account the next morning; and generally speaking, payment is made to the seller, the afternoon following the date upon which transfer is registered.
“On rare occasions, the purchaser’s bank delays payment on the same day and payment is made without question always within a couple of days after registration of transfer. Before the conveyancer can pay the seller he has to receive payment from the purchaser’s bank, utilizing the bank guarantee.”
Article courtesy of Lexis Digest