FILTERS:

Extension of Real Rights

2 March 2006

Titled Update On The Extension Of Real Right Development Process (EORR) The Dawning Of A New Era in Home Loans Financing, this booklet is intended to be a practical guide for developers, attorneys, estate agents and purchasers involved in the EORR process.

John Goldstone, the author who is the Managing Director of the Home Loans Division of Metallon Properties (Pty) Ltd, aims to address the lack of knowledge about EORR in the property industry and through it he hopes to promote the EORR process use and its relevant controls, procedures and documents.

What then is the basic difference between an EORR development and other schemes?

  • In a sectional title/phased development, the developer completes the units before opening a sectional title register and disposing of the units
  • With EORR the developer opens the sectional title register before completing the development and disposes of the EORR (land) subject to the end user entering into a building contract - (plot and build).
All the parties benefit, the developer's risk is reduced because a smaller loan amount is needed and interest rate increases are not as onerous over a shorter period. The purchaser of the unit enjoys cheaper initial transfer costs and has more input in the unit to be built.

The bank benefits from having a reduced loan amount spread over a shorter period converted to long term users. Activity by speculators will also be reduced.

The booklet costs R100 (excluding Vat) and John Goldstone may be contacted for its sale via email johngo@metallonprops.com or by cell phone at 084 677 2311.

Reader Comments: 1
Annette Fyfer 02/03/2006:

My experience is that banks do not understand this procedure which causes endless delays in approval of the bonds. Even still in Zimbali.

Submit your comment:
 
Name
EMail
Comments
Security Picture (click to change)
Word shown in picture: