Can transfer fees be included in your bond?

Article summary

• Transfer costs are one of the additional expenses that need to be taken into account when purchasing a home.
• It includes post, petties, FICA, and transfer duty, although the latter is only payable on properties above R1 000 000.
• The ooba Home Loans Transfer Cost Calculator can help you determine your likely transfer costs.

Transfer fees are one of the additional expenses that need to be taken into account when purchasing a home. They are paid to a transferring attorney, appointed by the property’s seller to transfer ownership to you.

This cost varies depending on the purchase price and comprise the conveyancer’s fees plus VAT, and the transfer duty payable to SARS. Transfer duties only apply to properties worth more than R1 000 000.

Can transfer fees be included in the bond?

In most cases, Transfer costs cannot be included in a bond, and will have to be factored in as an additional expense, on top of the home loan repayments, interest and deposit.

However, if you secure more than a 100% bond, this is likely to cover transfer fees as well as other related costs. Of course, in exchange for reducing upfront costs, you will have higher home loan repayments.

Since many first time home buyers have difficulty paying upfront costs such as the deposit and transfer fees, securing a higher than 100% home loan can be a big help.

ooba Home Loans, South Africa’s largest home loan comparison service, can help home buyers secure a 100% bond. They also provide a Repayment Calculator that can help determine what your monthly repayments would be on, say, a 104% bond.

How much will transfer fees add to the purchase price

If you elect not to attempt a 100% bond, you should allow for around 10% of the home purchase price when accounting for additional fees, including transfer costs.

ooba Home Loans provides a Transfer Cost Calculator, which you can use to determine bond registration and transfer costs. Note that the transfer costs will also include post, petties, FICA and other fees.

Take into account these additional expenses that add to the cost of buying a house, and bear in mind that ooba Home Loans offers a number of calculators that can help you determine the costs involved in buying a home, along with tools that can help you prequalify for a home loan. Start with their Bond Calculator, then use the ooba Home Loans Bond Indicator to determine what you can afford. Finally, when you’re ready, you can apply for a home loan.