Our case was different. Paid the 2% initial option fee with the agent who recommended the subsale property which would be placed as confirmed sale. And another 10% of the agreed price after having to sign all the documents pertaining to the sale on another day with a lawyer whom we did not appoint. The verbal understanding communicated to us was that upon agreement by seller after signing the SPA on a later day, all relevant documentation pertaining to the sale would be submitted to state for approval. We will only have to release the money held in trust inclusive of another 10% to the seller only upon state approval. That is the reason I refused to give in to the 10% as demanded by the seller when he purportedly was there to sign the SPA. It was a significant risk. I was even told in the presence of my family members that should the buyer backed out after signing the initial OTP, we can claimed compensation of RM12,000/-. On hindsight, I should have engaged a good legal representative and should have read and scrutinised all details in the clauses on the huge heap of documents pertaining to the sales and not accept it as face value. My fear was what would happen if for some reasons the state did not approve...that's why I am just happy to lose a small sum of legal fee charges amounting to RM3,000/- and loss in foreign exchange rate. Just sharing with all brothers and sisters out there to heed the advice given by Wuqi. Anyway, I never met the seller except the OTP that acknowledged him as the owner, and all relevant documents pertaining to the sales at the agent's premises at HH. I am glad my son is wise.
Hi Sobrielo, sorry to read about ur son's bad experience. It may be time to change the housing agent. From what I read, the agent and the lawyer seemed to side with the owner. Since you r the one who's going to pay the lawyer, u should appoint ur own lawyer to ensure that ur interest takes precedent and is protected. In this case, ur son did the right thing! Remember not to use this lawyer again.
For anyone buying from sub-sale, the earnest deposit is currently 1% and u shouldnt be paying more than this. If the agent were to ask for 2% or more, they r usually trying their luck and acting on the instruction of the seller. The norm is 1% - and they know! So, try not to give in. But I know this is hard to do; especially when u've found ur dream home. lol
When I bought my house, I made my earnest deposit in an SG cheque made payable to my lawyer - NEVER to the housing agent! The amount to write is the equivalent after conversion to Sing Dollars. I then passed this cheque to the agent to pass to the lawyer. An agent worth his salt would know how to get in touch with the lawyer. Ensure the agent issued u a receipt for this.
Sign the option form provided by the agent. Usually, u will not get to meet the seller so, please dont expect to. After u hv signed, the agent would then bring the same form to the seller for his signature. Depending on the time of day u signed the form, and how hardworking or busy the agent is, the option form can be signed and completed by the seller within the same day, or if not, by the next day. Request a copy of the option form, after all the signatures had been gathered, from the agent, via email. After this, the agent would hand the completed option form with ur earnest deposit to the lawyer.
The lawyer would then call/email u to let u know that they have received the payment and the option form. If u do not hear from ur lawyers, u can call/email them to check. : ) Give them something like 10 days (plus minus a day or two) to get the Sales & Purchase Agreement drafted. Some can get this done very fast (copy from template only wat!). Once the S&P is ready for ur signature, the lawyer's office would usually get in touch with u. Ask for a copy of the S&P to be emailed to u to read first before going down to their office to sign.
Spend some time to read the draft, pen down any questions u have, or concerns u may want to raise with ur lawyer. At this point, u can get ready to remit the balance 9% (10% less the 1% earnest deposit u paid earlier) of the purchase price to ur lawyer. I did mine thru my SG bank's Telegraphic Transfer facilities, the method used is up to u. Make an appointment with ur lawyer to sign the S&P, usually at the lawyer's office.
Before u sign, the lawyer should go thru each point on the S&P with u and this is where u ask those questions that u have prepared earlier. If the lawyer didnt go thru every point with u clearly, u would know instancely if u hv got the right lawyer haha. Whatever......, get the lawyer to go thru and explain every point with u. Sign the S&P.
If u r taking a loan from the bank, the lawyer would also have prepared a Loan Agreement for u to sign during that same visit, thus saving u an additional trip to his office.
After the signatures are all done, the lawyer would then pass u the statements for their Professional Charges (bill lah). Usually the "bill" would have two parts: Legal Fees and Disbursement. There is nothing much u can do about the Disbursement part, but u can certainly ask for a discount on the Legal Fees. If u dont ask they wouldnt give, hurhur. As a guide, be prepared to pay 4.5 to 5% of ur house purchase price to cover the Legal Fees and Disbursement for the S&P (this cost include the State Authority Consent Levy and relating fee for foreigners); and about 1% for the Bank's Loan Agreement. U r not expected to pay this yet till u pick up the keys to ur newly purchased house at the lawyer's office - which can be 3 to 4 months down the road. For foreigners, this may be longer cos of the State Authority Consent.
What next?
After all parties (buyer and seller) had signed on the S&P, if u r a foreigner buying, the lawyer would proceed to submit ur application for the State Authority Consent. This is estimated to take about 1 to 2.5 months.
What next?
Wait for ur keys lor, which may take about another 3 months. In the meantime can start planning what u want to do to ur house.
Disclaimer:
This is just a guide and is based on my recent experience buying a house in JB thru sub-sale. Yours may vary and can be better than mine. Wuqi, r my above points correct? All good bros, pse feel free to add or correct. Thanks and all the best to all in the process of Living in JB!
