Now that we have shown our sincerity in buying the house by putting an earnest deposit (roughly 2-3% of the market value of the house) its time to call in the lawyers to seal the deal.

Lawyers

Either you love them or you hate. Then again they play a critical role in the transaction by ensuring that the rights of both parties ie you and the developer are protected.

There are a lot of lawyers in the market these days, both good and bad are available for hire. Certain developers do tend to make the buying process easier by providing a panel of lawyers for you to pick and choose.

My advice, get to know as much as you can from the lawyers in term of understanding your rights, the lawyers role and responsibility in the property purchasing process, and last but not least, the cost!!

However, don’t just be blinded by the cost, go for lawyers who are able to provide you with excellent service. Cause end of the day, its the service that counts.

 SnP (Sales and Purchase Agreement)

A legally binding agreement which is made between the buyer (you) and the seller (developer, owner etc). The agreement will document your purchase price, lot no, date (most important), your name, developers name and etc.

The document also spell out all the necessary terms and conditions as approved by Malaysian law. Honestly I havent seen one yet as I have yet to sign my SnP. However i was told that all Snp agreements are taken off a template that has been approved by the government.

 Taxes

A great man once said, “There’s 2 things thats certain in life, death and taxes”. Yupz, you have to pay taxes in order to buy a house. Thats the Malaysian Law and the taxes are called Stamp Duty.

In order to buy a house, you would have to pay a Stamp duty Tax on the SnP. This is actually the cost of transferring the land title of your house over to your name. Here’s how it is calculated

On the first $100,000 - 1%

On the next $100,000 to $ 4,900,000 - 0.7%

Note though that this is only payable to your lawyers in order to get the land title transferred to your name. In certain cases, you may save on this stampduty all together, but i am not gonna covered it here

The second tax that a buyer needs to pay is for the bank loan documents. Almost allnew and first time home buyers would have to pay for this unless of course, you’re buying you rnew home with cash.

The rates are as follows

0.5% of total loan amount.

This tax is payable upon signing the bank loan agreement.

 Hmmm other than that, there are a few more annual taxes that you’ll have to pay your local land authorities once you occupy your new home. We’ll cover that as we experience it.

Thats all for now… oh yah…never never pay your earnest deposit directly to the developer or the owner of the house that you plan to buy. Always go through a lawyer