������Ƶ

The Owner Financing Promissory Note is utilized in South African property transactions where traditional bank financing is either unavailable or undesirable. This document is crucial when property sellers opt to finance the purchase directly, effectively becoming the lender. It must comply with multiple South African legal frameworks, including the National Credit Act 34 of 2005, the Alienation of Land Act 68 of 1981, and the Bills of Exchange Act 34 of 1964. The document typically includes detailed terms of the financing arrangement, such as the principal amount, interest rate, payment schedule, default provisions, and security arrangements. It's particularly relevant in situations involving private property sales, family transactions, or cases where buyers may not qualify for traditional bank financing but can demonstrate ability to make regular payments.

1. Parties: Identification of the Note Holder (Seller/Lender) and the Maker (Buyer/Borrower) with full legal names and details as required by FICA

2. Background: Context of the promissory note, including reference to the property sale agreement and owner financing arrangement

3. Definitions: Key terms used in the document including Property, Principal Amount, Interest Rate, Payment Terms, and Maturity Date

4. Principal Amount: The total amount being financed, stated clearly in numbers and words

5. Interest Rate: Specification of the interest rate, whether fixed or variable, and calculation method in compliance with NCA

6. Payment Terms: Details of payment schedule, including monthly payment amount, due dates, and payment methods

7. Security: Description of the property serving as security and reference to the mortgage bond registration

8. Default Provisions: Consequences of default, including acceleration clauses and remedies available to the Note Holder

9. Prepayment Terms: Conditions and procedures for early payment or additional payments

10. Transfer and Assignment: Terms regarding the transferability of the note and notification requirements

11. Governing Law: Specification of South African law as governing law and jurisdiction

12. Signatures: Execution section with full names, dates, and witness requirements