Legal Procedures To Buying Your First Home
|February 13, 2012||Posted by Ann Khee under Property News|
Copyright (c) 123RF Stock Photos
In earlier post, we have covered things to consider before buying your first home. Today, we’ll look at simple legal procedures which take place from placing booking fees to vacant possession.
1. Place Your Booking
Congratulations! You have found your dream home. Once you have made your decision to buy the house, you need to pay a booking fee of min 2% or more, evidenced by a receipt of payment. You will also required to fill in an application form prepared by the broker.
2. Get Loan Approval
Within 14 days, the Sale and Purchase Agreement (SPA) is signed. Hence you will have to obtain a loan approval from bank within this time frame. The loan approval is a simple calculation that tells you the amount you’ll be able to finance through a loan and what your monthly payment will be.
Tips: You could actually obtain approval prior to booking if you are unsure of your loan eligibility. But the risky part is without a booking fee, the owner will sell the house to the next buyer that places booking.
3. Sign SPA
You will have to appoint a lawyer to handle the SPA and other legal procedures. On signing of SPA within 14 days, you must pay another 8% deposit to make up a down payment of 10% in total (in addition to the earlier 2% booking fee). Legal fees, stamp duty and broker fees (if any) are also payable when signing the SPA.
4. Sign Loan Agreement
Once SPA is signed by both parties, you can sign Loan Agreement (LA) with your preferred bank. Do make sure the documents are check thoroughly and in satisfactory conditions.
5. Transfer Titles
At this point the lawyer will take care most of the transfer process with registering the property at Land Office Registry. Depending on the property type or title, the transfer process usually takes 3-6 months, or more than a year in complicated cases.
Once full payment has been made, the seller has to pass the right of property to you and you will have right to vacant possession of the house. You are now a happy owner!