Impact of Delays in Rates Clearance on Property Transfers – How Delays in Rates Clearance Figures/Certificates Affect Property Transfers

Obtaining a Rates Clearance Certificate is a crucial step in the property transfer process, directly impacting timelines and the successful finalisation of sales. Delays in this process can lead to significant setbacks.

Clearance Figures Example

The Rates Clearance Process

1. Application to the Municipality:

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  • A Transferring Attorney/Conveyancer submits an application for Clearance Figures to the relevant Municipality. Depending on the Municipality, this can be done electronically or manually, with the Clearance Figures either downloaded or collected in person.

 

2. Issuance of Rates Figures:

  • The municipality issues “Rates Figures,” which include an estimate for rates, water, and electricity, often covering a four-month period in advance allowing for the transfer process and to ensure the certificate is valid and in compliance with the Deeds Office requirements.
  • Ideally, this process should take 5-10 working days, but it can extend due to various municipal issues.

 

3. Settlement and Certificate Issuance:

  • For normal transfers, the seller must settle the outstanding amount well before the clearance figures expire.If any high or incorrect clearance figures are received, they can be sent to our free Clearance Figures Helpdesk for a prognosis, with a 24-hour response on whether we can reduce the Clearance Figures.
  • Once paid, the municipality issues the Rates Clearance Certificate, typically within a few working days, to the Transferring / Conveyancing Attorney.

 

Rates Clearance Figures Example

Rates Clearance Figures Example

Common Causes of Delays

1. Errors in Rates Clearance Figures:

  • Discrepancies in payments, utility charges, or property information often cause delays. Municipalities may need to investigate water and electricity usage or discrepancies in building plans, further slowing down the process.

2. Payment Delays:

  • If the seller faces financial difficulties in paying the required amount, this can stall the process. While bridging finance is an option, its approval may also introduce delays.
  • Our services are crucial in such cases, as reducing the amounts can help expedite the transfer process. Finding smaller amounts of funds to settle debts is much easier than securing larger sums.

3. Municipal Processing Issues:

  • Occasionally, internal municipal issues or system failures can delay the issuance of the certificate, even after payment has been made.

Impact on Property Transfers

  • Delays in obtaining a Rates Clearance Certificate can stall the entire conveyancing process, leading to frustration for both buyers and sellers. For buyers, it may mean a delayed move-in date, while sellers may face prolonged financial exposure to property costs.

 

  • These delays can be particularly problematic in areas experiencing longer processing times. By involving our services early in the transfer process, we ensure that the property transfer proceeds smoothly and quickly by making sure the Clearance Figures are correct and as low as legally possible.
reducing high clearance figures stress free property transfers

reducing high clearance figures stress free property transfers

Conclusion

The successful and timely transfer of property largely depends on obtaining the Rates Clearance Certificate without delays. By understanding the potential challenges in the clearance process, ratepayers responsible for the payment of the Clearance Figures can take proactive steps to avoid setbacks, and buyers can manage their expectations accordingly.

Use People You Can TRUST:

Engaging with experienced Conveyancers and utilizing our services to ensure accurate and optimised Clearance Figures can significantly reduce delays, facilitating a smoother and faster property transfer.

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