Procedure to buy a house

So you decide to buy a house after considering several places but do not know the procedure. Fear not, as I will list out the procedures here for your easy reference. After both parties agree with the price, you will need to pay an earnest deposit (min 2%) for booking purpose (This is for new house). Advice is, do not pay for the 10% straight away, in case you change your mind for a better option.
After pay for the earnest deposit, you will need to appoint your own lawyer for the new S&P Agreement (Sales & Purchase Agreement). May take up to 2 weeks to prepare it. Once the S&P is ready, you will need to make the balance of 8% of the purchase price upon signing of SPA (Assuming your applied loan is 90%)
Other than that, you need to pay for legal fees for S&P (Travelling, Stamping, Photocopying, Misc fees), depends on your purchase price of your property. You may estimate your lawyer fees based on below:-
First RM100,000 – 1%
Next RM100,000  – RM 4.9 Million – 0.5%
RM4.9 Million – RM10 Million – 0.25%
Above RM10 Million – Negotiable
Note: The above is payment is for your lawyer to get the land title transfer to your name.
Ask for photocopy title of house
After choosing the house you want to purchase and agree with the price, ask broker for photocopy title of the house, if don’t have then photocopy the “old” S&P Agreement for your own lawyer to make a search on title.
10% deposit
You lawyer will draft out a new S&P Agreement for you to sign. Your lawyer will contact the seller lawyer if all agreement agreed. Signed new S&P Agreement and you pay 10% deposit to your lawyer (purchaser lawyer).
After signing the S&P Agreement, what next?..
After signing the S&P Agreement, you pay 10% to your lawyer, your lawyer will pay the 10% to seller lawyer
3+1.. Look for housing loan
After paying the 10% to your lawyer then you start to look for bank loan, you have 3 months to shop for housing loan. You may get extra 1 month extension if you really can’t find any housing loan. (time of completion of sales normally is standard 3+1 which is 3 months +1 month extension)
S&P Agreeement (Purchaser lawyer will do…)
The Sale and Purchase Agreement must be stamped at the Stamp Office. After the examination on the property of the valuation department, Stamp Duty is paid to the Stamp Office. The transfer of title to your name must be registered at the Land Office Registry.
Bank access credit history
The bank will assess your credit history, income and assets to determine what loans you qualify for. Thus, make sure that you have clean financial record in order to get faster approval.
If everything run smoothly, then you will required to sign bank offer letter which states how much the interest rate the bank is willing to offer to you, based on the purchase price and the type of property.
(** If you do not sign the offer letter, it will lapse after a few days to 2 weeks, depending on banks. And once it lapses, you would have to submit an application for loan over again.)
Your lawyer will then release the money to seller lawyer..
Take delivery…
You need to photocopy these documents for your lawyer also:-
–    Quick rent from past owner (Quick Rent / Cukai tanah which you need to pay yearly)
–    Assessment from past owner (Cukai Pintu which you need to pay ½ yearly)
–    Water / Electricity bill
–    Indah Water
–    Strata title / master title
Master title = The big title (refer to case studies)
Strata title = Strata title is similar to land grants it basically gives you the right to occupy a piece of land. Also should you decide to sell the property, the strata title enable the transfer of the property to the new owner.
Check everything okay, take delivery okay etc , bank loan approve.. then only release balance money to seller lawyer!
As for the keys, seller lawyer will hand over keys to your lawyer and you will need to sign a vacant possession (Empty. On completion of a sale a seller is obliged to deliver the property with vacant possession which means clear of occupants and of objects which are not included in the sale
Be cautious…
[Be cautious when buying new property in unfinished condominium projects. Buyers may not be fully protected against default, an issue vigorously raised by the Malaysian House Buyers’ Association, which has pointed to flaws in The Housing Development (Control & Licensing) Act 2002, and the Strata Titles Act. Those buying unfinished property from developers should ensure that the developer has a valid Developer’s License and a valid Sales & Advertising permit.]
Click here for Transaction Cost Fees, Stamp Duty, Lawyer Fees,  Real Estate Agent Fee, Other Fees
Do you know that you can take out money from your EPF to purchase house? Check with your EPF
List out all the banks on which housing loan gives you the best rate
For old houses, always CHECK for any damage inside house, cracks, water dripping, neighbours, tv reception, streamyx reception if you stay on high rise, telekom coverage coz some hard to apply for telephone no, dustbin area, piping, and etc

National House Buyers Association
Online elawyer S&P calculator, Stamp duty calculator
Loan Application documents require and many more
MRTA calculator
Another great site for MRTA and housing loans
Case studies
I am new here and this is my first time buying a property. Can anyone pls advice me whats the difference between a master title and individual title and its pros and cons?
i recently viewed a unit in Seri kembangan under Equine Park developer but the owner said it is still under master title.
1. Is it safe to buy a house under master title?
2. Will we ever get the individual title later?
3. Is it legal for developers to do it this way eg using master title and later converting to individual titles?
4. will the price of the house deteriorate later?
Pls advice, thanks.
Normally to save cost developer will develop a big piece of land under master title(eg:200 units of link houses under one big title). They need just pay the quit rent on the master title only(imagine if they sub divide to 200 individual title & pay quit rent on 200 unit of houses, a lot of admin work involve) When they selling off all the houses n completed built the house they will just submitted the Master Title to Land Office to subdivide to individual title with owner name on the title.
The buyer will worry that the developer delay in doing the submission to Land Office to subdivide the Master Title. The worse case is the developer wind up and buyer can’t even get their individual title of their house. So, my advice is you can check with the developer whether they already submitted application to land office to subdivide the master title to individual title. Normally it will take 3-5 years after the property completed to get the individual title as what i know.
1. If you got confident on the developer then is alright to buy a property under master title.
2. As mention above, normally will take 3-5 years to get the individual title, unless the developer is bankrupt then is hard to get the individual title(still can get the individual title but is take a longer time through legal procedure)
3. Yes, they got the right to do so(still within guideline in Housing Development Act)
4. If the house can’t get individual title in later time (eg: 10years) then i believe that will affect the house price downward. some of the bank even don’t want to give a loan to a property still under master title more than 5 years and above.
So, better to find out more about the developer track record before you make a booking fee for the house.
Disclaimer: This is just a brief information on procedures, consult your own lawyer for more details..
**I am still waiting for management to give me the insurance policy because there is a typo error on my name (this insurance cover fire but not burglary!?.. sigh~

Leave a Reply

Your email address will not be published. Required fields are marked *