Mr. Dylan Chong giving a seminar on “What should you know about strata title ”? at Reapfield Damansara Perdana on 02.02.2024. Participants around 30-40 people (mostly internal senior property agents).
Subsale Lawyer
Subsale Procedure is the buying of a secondary house from an existing owner. The Sale and Purchase Agreement (“SPA”) is not subjected to the law of Housing Development Act 1966 (‘HDA”).
The Buyer usually has to sign a “booking form” with the seller, and pay an Earnest Deposit, and there will be a 3 months timeline (“timeline”) from the date of SPA to complete the transaction.
The Buyer has to ensure that the Buyer disburse the loan/monies (cash) within the agreed timeline while the Seller has to ensure that they deliver good title to the Buyer within the agreed timeline.
Failure to do so, the Buyer and the Seller respectively can charge late payment interest.
Booking Form
When the Buyer found his dream house in a secondary market, he has to pay an earnest deposit to the seller or seller’s agent to “book” the unit. It is usually in a 3% plus Service Tax out the Purchase Price.
When the Buyer sign the SPA later on, the Buyer will pay the remaining 7% of the Purchase Price.
The remaining 90% will be by way of loan disbursement or Cash.
Booking Form also includes the following:
(a) Special Condition - conversion of title, renovation, early VP, refund of earnest deposit with 2 bank loans rejection and etc;
(b) Withdrawal of Monies from EPF Account;
(c) Request to repair certain parts of the unit/removal of certain items under the unit;
Property with Title or “Without Title”
Buying a subsale property starts with the fundamental question “does the property has a title”? What it means is that the property has to have an individual title (landed property) or strata title (condominium/apartment) issued out by the developer, and registered under the owner’s name.
In some situation, the individual title can be issued but not yet register under the owner’s name.
Property with Title - need to prepare Memorandum of Transfer and send the title to the land office for change of ownership
Property without title - need to prepare Deed of Assignment to assign property rights to the buyer. This 2nd situation is more complex than the first, and there is a need to assign the property rights to the bank as well.
Submission of CKHT Forms
In a subsale transaction, there is a need to submit CKHT Forms, the Seller has to submit a CKHT 1A & 3, while the Buyer has to submit a CKHT 2A.
It is the disposal form and acquisition form, both are mandatorily required under the statute to be submitted within the statutory timeline of 60 days from the date of the SPA or upon Consent letter being approved.
Consent Form
Consent Forms come in few category:
(a) Consent to Transfer;
(b) Low Cost Consent;
(c) Consent to Charge;
(d) Foreigner Consent
each consent required to be applied with the relevant land office.
The above article is for general information only and does not constitute legal advice. For advice on your specific circumstances, speak to us.
