Good news for Penang and visitors or tourists planning to go there for a holiday. You will be able to hop onto a monorail to tour around the Penang Island soon! Read the news articles below for more information. Read more »

Hiring lawyers comes with a cost :). As such, to assist new home buyers who have just purchase, or those who are planning to buy their first dream home in Malaysia, I’ll be listing a list of Legal Fees to be aware of.

Lesson 2 - Lawyer Fees 

The fee structure listed below is applicable on to home buyers who fits the following criteria

1. Bought/Purchase a home which is still under developer master title
2. Obtained a loan facility from any Bank

For homebuyers who fulfilled the above criteria, do note that you would have to be prepared to fund the following lawyer Fees.

• Lesson 2.1 - Sales and Purchase Agreement (SnP)

SnP is an agreement between you (the homebuyer) and the developer. It serves to protect the interest of both paarties in the event of a dispute and the clauses in the document is safeguarded and dictated by Malaysian Law.

During the SnP, the developer may impose on the buyer several other “Agreements” for eg The Deed of Mutual Covenant. In brief the Deed Of Mutual Covenant is used to protect the rights of each and every individual household within the gated community as well as the right for the developer to run the maintenance and upkeeping of the facilities within the said property within a certain period of time upon completion.

Legal fees for SnP is dependent on the Purchase price of your Dream home. Basically you should be able to estimate your lawyer fees based on the following

1. First RM100000 - 1%
2. Next RM100000 - RM4.9 million - 0.5%
3. RM4.9million - RM10million - 0.25%
4. Above RM10million - Negotiable.

SO typically for a property costing RM300000, do expect to fork out at least RM2000 in professional fees alone for SnP.

There are several other Miscellanous fees attached tot he whole SnP billl as well for eg Travelling, Stamping, Photocopying, Miscelllanous (yupz there’s a space for Miscellanous) and Searches (Bankcruptcy, Title). These miscellanous fees could easily add another RM300-400 in your final bill. Read more »

As my partner said, I’m hijacking the site. Well, anyway, when there’s good things, must share right. I’m diverting from the usual property talk we do to present to you this recent finding which I find is rather interesting.

I first stumbled upon Agloco when I was surfing around the web and reading other people’s blog, Wei Ping’s to be exact.I read the write-up there and was attracted to the novel idea, which I like a lot. Here I reproduce the write-up here, which I find is quite comprehensive.

What is Agloco?

Agloco simply means A GLObal COmmunity which is a system that connects online advertiser with the potential customer which is of course, us, as a internet user. It is the only way you can earn money online by doing what you are already doing - simply surfing the web.

Agloco is completely owned by its users where the shares will be sold in London later and is led by a group of professional people including experienced entrepreneurs and managers.

How do I earn money from it?

Join as a a member and the good thing is, it’s FREE. Download the Viewbar (due to be ready in a few weeks time) and just surf as you normally do. You will be paid in various channels:-

1. Members will be paid on a per hour basis based on your monthly usage of the Viewbar up to a maximum of 5 hours per month. Advertisement will be displayed on the Viewbar and the advertiser will pay Agloco and Agloco will reward its member for using the Viewbar.

2. Members who used the referral system to build the community will be rewarded.

3. Members will get a share of commission on what Agloco received from the advertiser when its member purchase a product or services from the advertiser.

However, do note that member will not be paid for recruiting new members into the community or clicking the advertisement on the viewbar.

Is Agloco a scam? Can I trust this company?

It can’t be a scam as it is completely FREE to join Agloco. Agloco is founded by a few successful people, including 8 Stanford graduates, who also founded AllAdvantage, which created some controversy by paying $100m cash money to its user before it crashed to the Dot Com burst in year 2001. The good thing is none of the member complained about being not paid when it went out of business.

How does Agloco makes money for its member?

Agloco generates money for its member through a few channel. Major one are:-

1. Searching - When you use the Viewbar to do a search like how you normally do using Google or Yahoo, Agloco will get paid from the search engine providers.

2. Commission and advertisement - The Viewbar will display targeted advertisement based upon the websites you are visiting and Agloco will get paid a certain amount of commission if members buy something online as a result of viewing the advertisement, which the commission will be passed on to its members.

Step by step guide in joining Agloco

1. Click on the Agloco image above to join and it will prompt you to the following page:

2. Fill in your particular and click the “Click Here To Join” button.

3. Check your email account and click on the link to complete the registration.

4. And that’s it, you should see your referral code and welcome to the family.

Lawyers lawyers lawyers……

As i mentioned before, either u hate them or you love them. Thats pretty much what we did, love and hate them.

Lawyer firms in Malaysia are pretty complex. Some are one-man show lawyer firms while others are so called “MNC”(big) equivalent (with numerous partners). Well it might be the same for the rest of the world, but its certainly an eye opener for me when it comes to dealing with them.

Through our recent home buying deal, we learnt a painful lesson that we would like to share with all first time home buyers. This lesson is unique in a way that you will not learn it from any books. (Hmmm Would be a good topic for my ebook)

Lesson No 1 - Predetermined your Banker

The Bank you engage for your end-financing services will determined the law firm that you will work with. 

As such, before engaging the services of any lawyer firm, first predetermined the Bank. Different banks in Malaysia have different requirements on the lawyer firms that is “allowed” to do the loan processing. They have the so-called “Panel” lawyers that will be given the privilege to engage with you on loan documentations.

Therefore, once you have narrowed down your home loan choices to a few banks (ie 2-3), obtain the names of the law firms that is on the banks panel. Best case scenario would be to hire a lawyer who is on all 3 banks (of your choice) panel of lawyers. If this is not doable,  then rank and rate the banks of your choice based on the offer letter, and hire the lawyers accordingly.

Ultimate goal is to be able to hire the same law firm for your Loan Documentation with the bank as well as engaging them to handle your Sales and Purchase Agreement with the developer. In Malaysia, the developers are usually pretty lax on the law firms that is used to represent the home buyer. On the other hand, Banks are very reluctant to work with Law firms that are not on their panel.

Rule of thumb - Foreign banks tend to prefer “MNC”(big) law firms due to their higher malpractice insurance coverage while most local banks are comfortable working with one-man show firms. Hence, Predetermined your bank and the bank will determined your lawyer firm.

 Tags: Lawyers, Lawyer, Banker, Malaysia, Home, Property, Properties, Law Firms

“Too many cooks spoils the soup” - too many lawyers and a simple transaction becomes a long and lengthy transaction.

The same key learning applies to home transactions as well. It is wise to keep all the legal transactions under one law firm whenever possible and limit to 2 for complicated one.

Not only will you save on legal fees, you would also save on the headache, heartache and stress of working with various lawyer firms. You will also save on time, especially when time is of essence in a house loan legal documentation.

As such to assist future first time home buyers, I will be writing a series of Key Learnings on the stuffs I have learnt based on my experience in dealing with 2 different lawyer firms on my recent house purchase activity.

So stay tune and look out for the upcoming Key Learning series.

In short, this is the proposed schedule of activities, based on our experience:

1. Search for a good property at a good location

2. Choose a good unit, taking into consideration the feng shui, the direction the house is facing, the surrounding things to take note of, etc. I’ll cover that in another post.

3. Put down a booking fee for the unit.

4. Shop for a good home loan. Go to or call up banks. The trick is to call the banks and get the banker to go to your house for a presentation. During the presentation, ask everything you need to know, including the penalties and perks.

5.  Choose either flexible or conventional plan. Difference is the interest rate and the flexibility. More details should be covered in another post. Personally, we prefer flexible loans, because we factor in the possibility of us earning much more in the future and are able to pay off our housing loan much faster.

6. Once you have found a good home loan deal, get the banker to generate an offer letter. The offer letter will be ready in a few days time. Sign it, in order to lock in the offer. If not, the offer will lapse after the limited period. Check with the banker because the expiry date would be different for different banks.

7. Once you have decided on which bank to take the home loan from, find out the bank’s panel of lawyers. Check if any of the lawyers is also on the panel of lawyers doing up the Sales and Purchase Agreement.

The objective is to have one lawyer handling both the loan documentation and the Sales and Purchase Agreement. Why? So that you can save on lawyer fees, which could range from hundreds to thousands, based on discounts given. Another advantage is that they can get the documentation up faster too, minimizing delays in payments etc, without having to deal with another party.

As for the shopping for home loans from banks, I would leave it to another post.

8. Once you have found the lawyer to do both loan and Sales and Purchase Agreement documentations, set a date to sign the documentations. Could be done on the same day or different days. If it is done on the same day, then it saves you time and hassle.

9.  Sign the documents, pay a deposit for the lawyer fees and wait for the lawyers to get back to you with the stamped documents. Once all the documents are in place, then only you pay the lawyer in full.

10. After that, it is time to anticipate the first draw down,  which also means, time to start paying the home mortgage. Usually the developer draws money from the bank in stages, according to a schedule given in the Sales and Purchase Agreement. Will put up a sample schedule in another post.

11. So, based on the schedule, you can plan your finances properly, in order to minimise the amount of interest you have to pay. Oh, btw, this only applies to flexible loans.

Simple isn’t it? If you practice this often enough, it will become like a second nature to you. Buying a house/property will be like buying rice. Ahh.. how good!

So what after the signing of the Sales and Purchase Agreement? Time to find ways to finance it, right?

No! Utterly wrong! Though there’s no hard and fast rules, but this is one mistake you could make, based on our experience. And this is THE mistake we almost committed.

Why?

Because by the time you have signed the Sales and Purchase Agreement, the clock has started ticking. You have limited time (how much, partner please help me to fill in) to get the method of financing in order.

And if you do not manage to secure a loan from any banks and when the first drawdown, meaning the developer is asking for money, you are liable to pay the interest of usually (how much again partner… hehee).

Usually, if you have a clean financial record and have a good relationship with all banks, the likelihood of you not being able to secure a loan is rather low.

Let me share with you the mistake we made.

After putting down the booking fee for the house, we went shopping for home loans, which is a correct thing to do. But the uncertainty we had was that we did not know when is the signing of the Sales and Purchase Agreement, as the developer was yet to receive their developer’s licence.

It was about 5 months wait, before we received a call asking us to sign the Sales and Purchase Agreement in 2 weeks’ time.

What went wrong was that, during the 5 months, after the initial hype of looking for a home loan and finally narrowing down to two banks, we did not sign any offer letter, despite one bank having generated one for us. We did not know that the offer letter will lapse if we do not sign it and thus making the offer invalid.

And so, after the lapse, we still continued to wait for news on the Sales and Purchase Agreement signing.

What we should have done was that, during that period of time, continue to monitor the banks for better offer on home loans and promotions given out. At the same time, find out the panel lawyers for both the banks and the developer. This information will come in handy when you need to decide on which lawyer to take.

Even though the uncertainty of a date for the signing of SnP was a challenge, we should have still decided on the bank we want to take home loan from, and then to generate the offer letter and sign it, meaning locking in the competitive interest rates. This way, makes it easier for you to decide on the lawyers.

Choose a lawyer who can handle both the SnP and the loan documentation, meaning the lawyer can represent both the developer and the bank. There’s always the option of using an outside lawyer, which could be to your advantage as well. More analysis on this in the coming posts.

So, our advise, based on our own experience (disclaimer: use this with your own discretion. Owner of the blog is not responsible to any loss incurred from using this advice.) to be on the safe side, to start shopping for home loans from all banks from the day you put down the booking fee.

Better still, secure an offer letter from the bank, a letter which states how much is the interest rate the bank is willing to offer to you, based on the buying price and the type of property.

But, be aware that 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 all over again through the banker.

And the banker would have to get approval from the headquarters again. The disadvantage to this is that you have to endure the paper work and getting documents in order again - hassle and inconvenience.

But again, do take note also that the rates on home loans are very competitive. The rates offered by a bank can vary within months, maybe even weeks! One advantage of securing a deal after the signing of Sales and Purchase Agreement is that you might get better rates for your home loan.

And yet again, there’s the risk of time running out. So you have to weigh the pros and cons.

Look out for the nutshell steps to what you should do when you buy a new house in the next post.