Summary & Tutorial - Conveyancing: Due 27 Oct 2021 Conveyancing is a proces by which ownership of immovable property is transferred from one person to another. The end result is that the immovable property is registered in the name of the new owner at the Deeds Office when the name of the purchaser appears on the titledeed. This process is administered by attorney specialising in conveyancing, known as a conveyancer. There are usually three types of conveyancing attorneys involved: The transferring attorney: responsible for transferring the property from seller. The bond attorney: responsible for registering the mortgage bond over the property in favour of the bank financing the acquisition of the property and represents both the bank and the purchaser. The cancellation attorney: responsible for cancelling the seller's existing mortgage bond and thus represents the bank at which the mortgage bond was held by the seller. The conveyancing process 1. Purchaser pays a deposit of the purchase price to the conveyancer (atleast 25%) 2. This deposit could be invested in an interest-bearing trust investment 3. Balance (75%) financed by way of mortgage bond 4. Bank will issue a guarantee to the conveyancer that the loan amount will be paid upon transfer 5. The purchaser responsible for the transfer costs and an amount to cover the estimate of these costs is paid by the purchaser to the conveyancer in 6. Once the transfer has been registered, purchaser becomes the legal owner of the property. Question 8.1 4. You act for Mr Smith in a property transaction. He instructs you to draw up an agreement of sale in terms of which he sells his property to Mr Jones for R120 000, payable as follows: 1. A cash deposit of R10 000 to be held in trust pending transfer. 2. The balance to be secured by a first mortgage bond in favour of a bank for R80 000 and a second mortgage bond in favour of your client, Mr Roux, for R30 000. 3. The agreement provides for the conveyancing cost, including transfer duty and bond costs to be paid by the purchaser, and the cost of drawing up the agreement to be shared equally between the seller and purchaser. On 4 February 20.0 the parties sign the agreement and Mr Jones gives you two cheques for R10 000 and R7 500 respectively, being the deposit and proforma costs. 5. On 5 February 20.0 transfer duty of R3 600 is paid. 6. On 8 February 20.0 your bank advises you that Mr Jones's cheque for R10 000 was paid but the cheque for R7 500 was dishonoured. 7. On 9 February 20.0 Mr Jones pays you R7 500 in cash. 8. On 10 February 20.0 the bank's conveyancers give you a guarantee for R80 000. 9. You hold the balance of the purchase price of R30 000 in trust for Mr Roux. 10. On 15 February 20.0 the transfer is registered. You account to Mr Smith and include an amount of R500 for his half share of the costs of the agreement. 11. Mr Smith returns the cheque with instructions to invest it in an interest bearing account, the interest on which will be for his own benefit, pending further instructions. YOU ARE REQUIRED TO: . Record the above transactions in the cashbooks, ledgers, fees journal and transfer journal. Summary & Tutorial - Conveyancing: Due 27 Oct 2021 Conveyancing is a proces by which ownership of immovable property is transferred from one person to another. The end result is that the immovable property is registered in the name of the new owner at the Deeds Office when the name of the purchaser appears on the titledeed. This process is administered by attorney specialising in conveyancing, known as a conveyancer. There are usually three types of conveyancing attorneys involved: The transferring attorney: responsible for transferring the property from seller. The bond attorney: responsible for registering the mortgage bond over the property in favour of the bank financing the acquisition of the property and represents both the bank and the purchaser. The cancellation attorney: responsible for cancelling the seller's existing mortgage bond and thus represents the bank at which the mortgage bond was held by the seller. The conveyancing process 1. Purchaser pays a deposit of the purchase price to the conveyancer (atleast 25%) 2. This deposit could be invested in an interest-bearing trust investment 3. Balance (75%) financed by way of mortgage bond 4. Bank will issue a guarantee to the conveyancer that the loan amount will be paid upon transfer 5. The purchaser responsible for the transfer costs and an amount to cover the estimate of these costs is paid by the purchaser to the conveyancer in 6. Once the transfer has been registered, purchaser becomes the legal owner of the property. Question 8.1 4. You act for Mr Smith in a property transaction. He instructs you to draw up an agreement of sale in terms of which he sells his property to Mr Jones for R120 000, payable as follows: 1. A cash deposit of R10 000 to be held in trust pending transfer. 2. The balance to be secured by a first mortgage bond in favour of a bank for R80 000 and a second mortgage bond in favour of your client, Mr Roux, for R30 000. 3. The agreement provides for the conveyancing cost, including transfer duty and bond costs to be paid by the purchaser, and the cost of drawing up the agreement to be shared equally between the seller and purchaser. On 4 February 20.0 the parties sign the agreement and Mr Jones gives you two cheques for R10 000 and R7 500 respectively, being the deposit and proforma costs. 5. On 5 February 20.0 transfer duty of R3 600 is paid. 6. On 8 February 20.0 your bank advises you that Mr Jones's cheque for R10 000 was paid but the cheque for R7 500 was dishonoured. 7. On 9 February 20.0 Mr Jones pays you R7 500 in cash. 8. On 10 February 20.0 the bank's conveyancers give you a guarantee for R80 000. 9. You hold the balance of the purchase price of R30 000 in trust for Mr Roux. 10. On 15 February 20.0 the transfer is registered. You account to Mr Smith and include an amount of R500 for his half share of the costs of the agreement. 11. Mr Smith returns the cheque with instructions to invest it in an interest bearing account, the interest on which will be for his own benefit, pending further instructions. YOU ARE REQUIRED TO: . Record the above transactions in the cashbooks, ledgers, fees journal and transfer journal