Step by Step Guide To Buying A House – Part 1
Buying a house is probably one of the biggest investments a person makes in his lifetime. Not only does it cause a dent in the buyer’s pocket, the whole process of buying a house can be down right daunting and intimidating as the buyer has to deal with various parties for instance, the property agent, banker, lawyer and utility companies. I hope this series on step by step guide to buying a house will assist you in your hunt for a home.
To start off, some matters need to be mentioned. The house in question is a double-storey terrace house which is currently charged to a bank by the Vendor. It is situated on freehold land and individual title has been issued by the Land Office. The house is marketed for sale by a property agent and upon viewing the house, negotiation takes place on the purchase price. The buyer should insist on having a copy of the title or at least the title particulars so that a search can be conducted on the title at the Land Office to ascertain the identity of the current owner of the house and the existing encumbrances on the house.
Once the buyer is satisfied with the condition of the house and the purchase price, a booking fee is paid to secure the sale of the house. In this connection, the usual booking fee imposed in Klang Valley is 2% of the purchase price. Payment is made in favour of the property agent’s firm and a simple agreement is executed by both the vendor and the buyer on the important terms of the sale.
The agreement would usually include the names of the vendor and buyer, their correspondence addresses, subject property for sale, purchase price, period for payment of balance purchase price, default and dateline for signing of the formal sale and purchase agreement.
The buyer is given a receipt by the property agent for his booking fee and a copy of the simple agreement. Thereafter, the buyer has to appoint a lawyer to begin preparation of the formal sale and purchase agreement and to protect his interest throughout the transaction. In this instance, the minimal documents which the buyer is required to forward to his lawyer would be a copy of his identity card, copy of booking receipt, copy of the simple agreement, particulars of the vendor’s lawyers, buyer’s income tax number and submission branch, copy of title to the house and copy of vendor’s loan agreement. If the buyer does not have some of the documents, especially the documents which are in the vendor’s possession eg. the loan agreement, the buyer’s lawyers would write to the vendor’s lawyers for a copy of the same.
To be continued in Part 2. If you don’t want to miss Part 2, subscribe to this site’s feed for free so that you can be updated automatically.
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2 Responses to “Step by Step Guide To Buying A House – Part 1”
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Hi, I’d never known that you are talented in so many ways! I really really really admire Sis to have married such a good ‘Brain’! Hahaha =)
Your write-ups are really useful and relevant. Wonder if you have written anything on Mortgage Reduction in you old post? If yes could you tell me in which archive please?
A friend of mine told me that an agent from a KL-based Mortgage Reduction firm claimed he can save her RM200,000 with his services! He said he could find the loopholes in the Bank Negara regulations for her hire-purchase agreement. Is that true?
Many thanks!
[...] sequel to the Step by Step Guide to Buying A House. In our previous article, I have discussed the pre-purchase steps which a buyer of a house should take. In this article, I will share with you what are the common [...]