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**Please note that the following document is suitable for private property sellers only, in other words those that are selling their own property but are not regularly involved in the sale of property as a form of business. If you are, for instance, an Estate Agent, Developer, Builder or property investor who regularly sells property as a means of business, then you will need different documentation that is more CPA (Consumer Protection Act) compliant.
Click here to download the Offer to Purchase Document in pdf format (55kb).Refer to our private seller's info links on the left to help you sell property privately and to protect yourself legally. Information about filling in an Offer to Purchase (OTP) document Offer to Purchase documents may vary but they all have similar basic terms and conditions. In order to constitute a legally valid offer the document must be filled in with great care. The following requirements must be noted:
The Purchaser referred to on page one is considered to be the new owner of the property.
On the document it is crucial to have the property stand number as that together with the suburb’s name is what the Attorneys and financial institutions use as their main property description and search criteria. The same applies for the section number and sectional scheme (SS) number of a sectional title property. A lot of the time the unit door number is the same as the section number of the unit, but not always. You should find the details on your account from the Municipality, the Managing Agents or Body Corporate whatever the case may be. Exclusive use areas must also be mentioned such as a garden area or a carport. Purchase Price The purchase price is the total offer and must be mentioned for the Offer to Purchase document to be valid. It must be mentioned if the Purchaser, for instance, is to pay a deposit within 10 working days or if he is a cash buyer needing a time limit to have funds released. Bond Finance Here the Purchaser is usually given a time limit of 14 days to obtain a Home Loan (Bond Grant) from a financial institution. Usually this amount will be less any deposit as above but sometimes the Purchaser may wish to apply for additional funds towards alterations or for transfer costs for instance. Sale of Second Property This is a suspensive condition, meaning that the Purchaser must first sell his own property within a time limit in order for the Purchase to proceed. Usually the Seller has the option to continue marketing and can sell the property to another Purchaser who has more readily available financing, on the condition that the above Purchaser is given 3 working days written notice to provide proof of a firm offer on his property or an alternate means of financing. Page 2 Occupation It is important for a date to be placed here as the document will be void without a confirmed date or deadline. Some parties prefer to state “on registration of transfer” as the Purchaser’s occupation date. This usually means that there will be no occupational rental payable by the Purchaser but this should nevertheless be stated on the document as the date of occupation could shift if both parties agree to this later in writing. As a general guideline the occupational rental is usually 1% of the selling price e.g. if a house is sold for R800,000 then the rental should be R8,000 per month (excl water and lights). * Remember to inform the Purchaser that they should apply to the Council at least two weeks before their occupation and pay a deposit to have the services (water and lights, etc) transferred into their name. You will also need to apply to the local Council at least two weeks before vacating to do a final meter reading (in your name) to coincide with the date that you vacate the property. * Tenant’s rights come first in any such purchase agreement. (Read more about this on our link under ‘Tenant’s Rights’ on the Home Page of this Site. Agents Commission This section should be deleted unless you have incorporated the services of an Agent and you as the Seller have agreed to pay them a set amount for their services. Bear in mind that if an Agent is a vat vendor then vat will be charged and should be noted on your document. Fixtures and fittings This section applies to fittings such as curtain rails, fitted cupboards, light fittings, etc. If there is a swimming pool then the Seller is entitled to leave the pool pump and cleaning equipment. It is best to mention anything that the Seller has agreed to leave, such as a Wendy Hut, as well. Page 3 Acceptance This section on acceptance of an Offer would normally be filled in by an Agent on behalf of an absent Seller. This gives the Seller a set time to accept the offer from the Purchaser. If you, as the Seller would like time to consider the Offer then you can place a date here (24 to 48 hours ahead is usually reasonable) for your endorsement and thus acceptance of the Offer. Under these circumstances you must hold off on your part of initialing and full endorsement of the paperwork. The Purchaser would still be legally bound until such time as you accepted the Offer but the document would be void without your approval. Other Undertakings/Conditions This is a useful section and can be used for additional undertakings and conditions. If, for instance, you would like to remove a fitting that you and the Purchaser have verbally agreed to then it should be stated here in writing to avoid conflict or misunderstanding later. This section could also be used, for instance, for the stipulation of a limited amount of repairs that you have agreed to carry out for the Purchaser. Final endorsements (full signatures) are required by parties to the agreement and should be witnessed by major person i.e. one who is at least 18 years of age or older. Page 4 Seller’s and Purchaser’s Particulars Here the financier of the Purchase should be stated under ‘Purchaser’ even though the property may be bought in another’s name which should be stated on the top of page one of the contract. This page is mainly for the Attorney, Bond Originator or Financial Institution. The most important part of this page is the full contact details of both parties. It is best for both parties to fill in as much as they can but if they do not have all the particulars on them then they can have these handy at a later stage when they are called. The Seller’s nominated Attorney’s contact details should be clearly stated so that the financial institution can forward any positive instruction through to them at a later stage. Final endorsements (full signatures) are required by parties to the agreement and should be witnessed by major person i.e. one who is at least 18 years of age or older.  |
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