Follow these steps for a smooth secondary market property buying experience.
The additional steps that go into the process of buying a property from the secondary market can be overwhelming for a first-time buyer. If you are still in search for a home that jives with your soul, check out these 4 Klang Valley neighbourhoods that are perfect for a first-time homebuyer; but if you have found your one in the secondary market segment and have no clue what to do next, do not fret! We’ve got a step-by-step checklist to guide you on what you should do post signing of the Sales and Purchase Agreement (SPA).
1. Make sure all your payments are up-to-date
The seller will have to ensure that all outstanding fees such as quit rent, assessment, sewerage fee (Indah Water) had been settled before the lawyer can proceed to transfer the property to the purchaser. The purchaser, on the other hand, must ascertain that their bank loan has been approved and sign the bank loan letter of acceptance. If it is a cash deal, he or she must prepare the remaining amount of cash to be paid to the seller, i.e: after deducting the down payment amount which had been paid to seller upon signing the SPA.
2. Next comes the Fire Insurance and Mortgage Life Insurance (MRTA)
Usually, the mortgage officer from the bank will arrange for the purchase of a Fire Insurance for the buyer upon application and acceptance of the bank loan. Although it is not compulsory, most officers will encourage buyers to purchase an MRTA as it will provide for the full settlement on the outstanding balance of the housing loan amount in the event of any unforeseen circumstances such as death or total and permanent disability of the purchaser prior to the settlement of their mortgage.
3. Check your title transfer
What are some of the things that the lawyer must do when paying the balance purchase price? The lawyer must confirm that the name of the seller had been transferred to the purchaser (register of title). Besides that, the redemption of the seller’s mortgage and all other fees must be settled prior to paying the remaining balance amount of the purchase price to the seller.
4. Make sure your building is fit to live in
Vacant possession (VP) is the condition of a property where it is fully completed but not fit to be occupied. To protect buyers’ interest, developers are required by law to obtain proof in terms of a certificate by an architect, which certifies that the building is ready for water and electricity connection before issuing said VP. On top of that, the application for Certificate of Fitness for Occupation (CFO) will need to be submitted and accepted by the state authority before developers can hand out VP of housing units. The delivery of vacant possession will be instructed by the lawyer after everything has been settled and transferred from the seller to the purchaser and all after outstanding amounts have been settled by the buyer.
That’s all folks! Happy buying!
Written by Kong Chee Meng, Senior Negotiator of Gather Properties (Ipoh) and published in iProperty.com.my