Auction shock: Single mother's home sold for R5,000 after bond arrears
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FIVE thousand rand was all that a house previously belonging to a single mother of four fetched at an auction earlier this month, this after she ran badly into arrears with her bond repayments.
A devastated Patricia Mzamo, who said she attempted to reach a settlement with SA Home Loans, will still be held responsible by for the for the balance of the shortfall on the Randburg home after the R5 000 bid is factored in.
The records of SA Home Loans apparently showed that the current balance on Mzamo's bond account was R1 029 178.72, while the arrear amount was R582 790.37.
Once the purchaser completed and complied with the relevant provisions of the purchase and sale agreement, and took possession of the property, Mzamo and her children will become homeless as they will be expected to vacate the property promptly.
Mzamo did not dispute her her indebtedness to SA Home Loans, but engaged in legal battles with the entity for four years over her outstanding dues and tried to negotiate a settlement for the arrears.
However, what astounded Mzamo was the property being sold at an auction for R5 000, while she attempted to secure a settlement with the entity?
Mzamo was taken aback when SA Home Loans' legal representatives informed her that the property was sold at auction on April 2 for R5 000 and that the transfer process was in motion.
She also learnt that she needed to exit from the property as the new owner was likely to take possession soon, and that Mzamo was liable for the full amount owing on the bond account, which came about due to the shortfall (after the property was sold for R5 000) on the amount she owed.
Mzamo was asked to continue with repayments that she could afford, to ultimately reduce the shortfall.
SA Home Loans' attorney, Chandika Chaithoo, explained that proceeding to a sale in execution was not taken lightly, nor was it their preferred outcome, but always a last resort.
'SA Home Loans always looks for ways to work with our clients, who find themselves under financial stress, to find a solution that assists the client to resolve their situation while protecting the interests of SA Home Loans.'
Chaithoo said they were also always willing to work with their clients to sell their property privately to obtain maximum value and payment into the bond account in instances where they are unable to settle the arrears or enter into a (feasible) payment arrangement.
She pointed out that there is judicial oversight during these proceedings, which included the setting of court reserves for the sale in execution.
On why the property was sold only for R5 000, Chaithoo said: 'It should be taken into account that the successful bidder at a sale in execution is not only liable for the payment of their bid, but also has to settle any outstanding rates, levies, or utility bills on the property as well as the costs of the auction and the transfer of the property.'
Mzamo said that she fell on hard times when she lost her job due to retrenchments and has since found work in the property industry, but she does not pocket a constant income as she earns commission only when she sells a property.
According to her, she tried her utmost best to sell her home herself, but as it is in an unsafe neighbourhood, she struggled.
She also tried to secure the R100 000 she said SA Home Loans was willing to accept to avoid the property being auctioned, but she was unable to raise the money.
But the news that her home was now sold for R5 000 is something Mzamo cannot comprehend, especially as she is still left with all her debt.
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