Have you spotted the property of your dreams but you need time to gather sufficient finance or to sell your home?

Consider asking for a First Right of Refusal, where you get the first opportunity to purchase a property, before the owner can sell it to someone else.

Maybe consider an Option to Purchase, where the purchase price is agreed and fixed upfront. In some of these cases, and more specifically where the right to continued marketing is removed, a seller will insist on an upfront option fee to be paid.

A further option is a Rent to Buy agreement, where a lease agreement includes an Option to Purchase. In this instance there may also be additional option fees payable. This type of agreement, or a combination of the above, can assist a purchaser or tenant to build up a deposit or to obtain finance. 

Until the transfer of the home goes through, the buyer’s name is not on the property’s title deed and if this is something the buyer prefers, then an instalment sale agreement could also be considered.

Here the purchase price is paid in more than two instalments and the buyer is protected in that the seller is not entitled to payment unless the property is registrable, and the section 20 Recordal of the instalment agreement is registered on the Title Deed in the Deeds Office.

In the event of the seller being declared insolvent, the purchaser enjoys a preferent claim after the banks if a bond was registered over the property.

It must however be taken into account that if the seller wants to charge interest, the seller must comply with the National Credit Act No. 34 of 2005 and would likely need to be registered as a credit provider; and if transfer duty must still be paid within 6 months from the date of signature of the sale.