Can real estate agents make you give the house back if there is still some money outstanding?

The long answer

There are a number of questions that arise from this which we will go into, but the most important thing is that the agent does not have the power to simply take back the house. 

What your mother needs to do first is to find out what the R9,000 she owes is for. Is it for some kind of occupational rent she had agreed to pay till the house was legally transferred to her name?

Just to be clear about how transfers of property work: 

There cannot be a transfer of property without a written sale agreement that sets out exactly what and where the property is, the price and any conditions for the sale, and is signed by both the seller and the buyer. An oral agreement is not binding. The written and signed sale agreement is a legally binding agreement and all the conditions in this agreement must be fulfilled or carried out by the parties. If one of the parties has not fulfilled their part of the agreement – for example, if the buyer has not paid the amount agreed on, by the time agreed on – the seller will notify the buyer to fix the breach of agreement within seven days. LegalWise says that if the buyer does not fix the breach, the seller can go to court to demand payment or cancel the sale agreement and go to court to claim damages.

Could it be that what you call the agent is actually the conveyancer or conveyancing attorney (lawyer) who is legally required to do the work of transferring the property from the seller to the buyer? It is usually the seller who chooses the conveyancing attorney but the buyer who pays the fees of the conveyancing attorney.  

LegalWise gives the different steps in the transfer process:

• The conveyancer is instructed by the seller to transfer the property to the new owner;

• The conveyancer communicates with all the different people involved: the seller, the buyer, municipality, bank, bond attorneys if applicable and SARS;

• The conveyancer has to collect the information and documents needed such as the sale agreement, the deeds office search, the existing deed, bond cancellation if applicable, and to report back continuously about progress made;

• The conveyancer must prepare all the transfer documents and get the seller and the buyer to sign them;

• The conveyancer may ask for an advance payment to their interim account for certain expenses such as collecting the purchase price or deposit;

• The conveyancer must get a transfer duty certificate from SARS confirming that transfer tax has been paid (If applicable. The first R900,000 of the purchase price is free of transfer tax.);

• The conveyancer must obtain a clearance certificate from the municipality confirming that all the municipal expenses (electricity, rates) have been in paid in full for the last two years;

• The conveyancer prepares to submit or lodge the deed of transfer with the necessary required documents for registration at the Deeds Office;

• After the Deeds Office is satisfied that the requirements for transfer have been met, the deed of property is registered, and the conveyancer will notify the seller and the buyer that the deed has been registered;

• After the registration, the conveyancer will make all the calculations and payments relating to the sale, and will draw up the final conveyancing account and send it to the buyer and seller for payment. 

Once the Registrar of Deeds signs the transfer, the buyer becomes the legal owner of the property, and a copy of the title deed is kept at the Deeds Office closest to her.

If your mother is not sure whether there has ever been a title deed issued for the house, she can check at the Deeds Office. She would need to go in person to the Deeds Office with the erf number of the plot and the full name and/or ID number of the previous owner. They will help her fill out a form to check whether the deed was registered and she would have to pay a search fee of R14.

Is it possible that the money your mother owes is to the conveyancing attorney? 

It’s important that she establishes the facts about this so that she can plan what to do.

She could ask Legal Aid which is a means-tested organisation for advice and assistance here:

0800 110 110 (Monday to Friday 7AM - 7PM) 
079 835 7179 (Please Call Me) 
communications2@legal-aid.co.za

Wishing you the best,
Athalie