When is the right time to be registered as a Credit Provider?

If you sell property, land or anything else to someone on credit, you enter into a credit agreement.

In essence, you are now the seller and a credit provider.

The National Credit Act stipulates that you must be registered as a credit provider to conclude the transaction. Failure to do so will entitle the other party to cancel the transaction at any time and reclaim all the money paid to you in terms of that agreement.

However, the Act does not apply to the following situations making it unnecessary to register as a credit provider :

1. Where the transaction is not at arm’s length. e.g. where the other party is a family member.

2. Where the other party is a company, close corporation or trust (juristic person)and its asset value or annual turnover is more than (currently) R 1m.

3. Where the juristic person has an asset value or annual turnover of less than R 1m and secures the debt by way of a mortgage bond or where the amount of credit is at least R 250 000.

Contact Loftus Law for more information

Lending people money can become complicated and lead to unexpected problems. Rather than putting yourself through the stress of going  it alone, contact us and let us assist you.

Our Team:

Russell Loftus (Attorney and Conveyancer)

Tel 082 651 5548

Email: russell@loftuslaw.co.za

Jan Watson (Paralegal)

Tel 011 447 1534 | Mobile 082 560 8843

Email: jan@loftuslaw.co.za