What is the process for changing partners on a joint home loan?
[An Article by: Tarryn Gravenor of Harold Gie Attorneys – Properety24 – 26 August 2025]
Many homeowners face concerns about co-ownership and their status as a borrower on an existing home loan registered with one of South Africa’s major banks. Understanding the process for changing partners on a joint home loan is essential to protect rights and ensure a smooth transition.
“What is the process for changing partners on a joint home loan, and how can homeowners protect their co-ownership and borrower status under an existing mortgage bond with a major South African bank?”
Property24 guest expert Tarryn Gravenor of Herold Gie Attorneys offers the following advice:
There are significant practical and legal consequences associated with joint ownership of immovable property in South Africa. In many cases parties do not take legal advice in advance and are sadly left with uncertainty and stress when circumstances change and one of the partners leaves by choice or necessity.
Changing partners on a joint home loan is a process that requires careful consideration and adherence to specific procedures under South African law.
It is likely that the bank’s mortgage loan agreement would have clauses for joint and several liability and if one of the co-owners were to have an adverse credit score, incur debt and/or have judgement taken against them or be sequestrated the bank would proceed after whoever is the easiest target and if that is you, you would not have any effective recourse against the co-owner if the co-owner is sequestrated. In the circumstances it is advisable to minimise the risk and get the property and bond off your name as soon as possible.
Here is a brief overview of the considerations involved:
1. Review your Title Deed and Loan Agreement:
The first step is to know what your title deed states as to the identity of the registered owners, their marital status, what contractual terms apply regarding (changes in) the partnership and/or property ownership, and to understand the applicable law.
2.Consult with the Lender:
Once you have reviewed your title deed, the terms of the loan agreement and joint ownership agreement (if any), it is advisable to speak with your bank directly. They need to approve any new loan or restructure the existing loan agreement and may further require documentation. The process usually involves a credit assessment afresh in compliance with the applicable credit laws and requirements of the particular bank.
In terms of the Deeds Registries Act, the bank as bond holder will require that the existing bond either be cancelled or they would agree to a substitution of debtor under the existing bond, in effect releasing one borrower from their obligations under the bond
If a co-owner/s buys the share in the property from the other owner/s, then the remaining co-owner/s would have to apply for the bond to be put onto their name alone under section 57 of the Deeds Registries Act. If the property is to be sold to a third party, then the bond will need to be cancelled.
3. Transfer
To minimise risk and liability as a co-owner, the share in the property would need to be transferred off the name of the exiting party, or the party could buy the property and become sole owner. A transfer of the share of the exiting owner must be registered at the Deeds Office by a conveyancer.
For the conveyancer to start the transfer process for you, advise you of the cost involved to transfer a share of the property to another, they would require certain information and documents, such as personal particulars of the parties, copies of identity documents, latest rates account, proof of residence for the owners and buyer (if applicable), title deed and reputable estate agent’s fair market valuation for the property to assess the current market value.
A suitable agreement or deed of alienation would then be drafted, usually by the conveyancer handling the transfer, with a view to attending to the required transfer and release of the exiting partner from their obligations under the loan, and co-ownership of the property.
4. Be aware of associated costs
Be aware that there are costs associated with a new or restructured home loan and its associated Deeds Office registration, including bond registration costs, bond cancellation costs, and transfer costs, including transfer duty payable to SARS.
The buyer usually pays for the transfer and bond registration costs to buy out the other party.
5. Rates and Taxes, Insurance, Capital Gains Tax and other considerations
All co-owners are jointly and severally liable for the payment of insurance premiums and municipal rates and taxes upon transfer of a property, despite any agreement entered into with each other. Furthermore, the issue of capital gains tax would need to be considered especially where the property has been acquired by the owners some years ago, and the property value would most likely have increased in that intervening period.
6. A note on joint ownership
While the co-ownership relationship exists, it is important to consider what happens if your co-owner/s go/es insolvent, or if your co-owner’s creditors attach his/her share in the property for sale in execution. Without an agreement to the contrary, a co-owner can sell his/her share without the other’s consent – a recipe for dispute. It would be prudent for all owners to co-operate with one another to come to an agreement in writing which will govern their respective rights in the property, and how the property is going to be dealt with going forward. The alternative is simply not worth the hassle, stress, delay and cost (of legal action).
Things like the following would need to be considered in the agreement:
- Who made which contributions to the purchase and costs to date
- Who has the right to occupy the property
- Who will contribute what amounts to the ongoing future costs and finances
- How the net profits or losses will be split, should the property or a share be sold
- The sale of one party’s share being restricted or regulated
- How you will value the property, or each co-owner’s share in it
- Insolvency, death or incapacity of one of the parties
A conveyancing attorney who is well versed in property law, the law of contracts as well as the provisions of the Deeds Registries Act and its regulations and practice in the applicable Deeds Registry would be able to attend to all the required legal steps and provide you with sound advice at the outset and guidance along the way.
The Original Article can be Viewed here: → https://www.property24.com/articles/what-is-the-process-for-changing-partners-on-a-joint-home-loan/32748?fbclid=IwQ0xDSwMa–5jbGNrAxr75WV4dG4DYWVtAjExAAEe1KMfEUYXeFh86_6l2p9xuwOZkpP2Mi8eub4fAr_RO71d8UBLwg-aC3RhsbI_aem_S6ZR_dNDIW1L837hqfGAOw&sfnsn=scwspmo
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