Buy Or Rent? Which One Better For You Now?

Should I go for buying or go for renting? Which one is better for my current financial status? I believe this is the most annoying question that besides of “when you get marry” or “when you plan to have a baby” etc etc. But, do you ever ask yourself whether you’re suit for buying or renting a house?

Before you answer this question, here are the other questions you should ask yourself first.

My first house should go for investment or own stay

My first house should go for investment or own stay?

In this question, you may need to re-think about your future living arrangements. One home is not a guaranteed source of income. There are many factors that affect a home’s valuation such as location, neighborhood, management as well as its facilities. A great deal of planning is required to search for the house that perfect in investment such as easy to rent or sell out. When you plan for sell out the house after 5 years, all these factors will affect to the final selling price. (Do read our another article: Should I Buy A House For Myself Or Investment)

Are you comparing monthly rent to monthly loan repayment

Are you comparing monthly rent to monthly loan repayment?

The biggest mistake for many people who often compare the monthly rent to monthly home loan installment. Honestly, when you comes to buying a house, there are many existing additional costs that you need to think about only make a fair comparison which is property tax, property insurance, property maintenance and etc. Especially the property maintenance, in some cases, it is costly than other taxes or fees. For example, wiring goes wrong or pipe leaking, the you must find the specialist to fix those problems to you.

Are you able to control the stress

Are you able to control the stress?

Buying vs renting, this is the biggest decision to make for many people in the world! You can’t underestimate the stress when you comes to buying a house. Stress overload can caused missed payments, which can effect you personal credit or even losing the house. If you don’t think you are ready to buy a home, then rent first! Don’t push yourself so hard. (Do read our another article: Tips to Reduce Stress When Buying a House)

What is your current age

What is your current age?

Don’t laugh! This is an important question to ask yourself. If you are in 20s or early 30s, there are some arguments for not buying a house. It is about your responsibility. Once you own a house, you are required the financial flexibility which will affect your social life as you have to pay for your monthly loan installment. But if you have sufficient fund after pay for home loan, you still can use that money to take yourself to the interesting places.

Besides, kindly take note that if you’re buying a house after 35s, the bank most probably will reject your house loan application or narrow the period for loan repayment. When that happens, buying a house becomes much more difficult as you need to prepare a lot of money for monthly installment. (Do read our another article: Why You Should Buy House In Young age).

Last but not least, to buy or to rent? You should ask yourself all the above questions before make your decision. If you think you can afford for a house and still in a comfortable on financial status and stress free, then you should go ahead and proceed with the purchase. If any of the above questions strike you to shout “No Way”, then you should go for renting instead.

Source: WMAPROPERTY

It’s not about property ownership it’s about control! To get more details, visit 👉 Property Millionaire Intensive

No Extra Savings To Decorate Your New Home? No Worries, This Type Of Loan Can Help You Out!

There is a few things in life are as daunting as decorating your first home. It’s really hard not to feel overwhelmed as there is so many options available in the market and so many decisions to make. Ok, let say you already have an awesome ideas on how to decorate your lovely new home, but the first thing that always comes into mind is “I have spent 90% of my savings on house purchase, now I’m out of budget to decorate my new home that I like”. Well, that is really disappointed.

But, wait a minute!!! Did you know there is a type of loan that actually available for those who are facing house decoration problems like you to apply? Yes, that is Renovation loan! Whether you are starting out or starting over, this is a great choice to help yourself to navigate the difficult process of decorating a home for the first time.

renovation loan

Continue read on to get more details about renovation loan;

Renovation loan is a kind of personal loan that specifically designed for those homeowners who facing difficulty on house decorating. Renovation loan is usually bundled with a home loan and is sold as a package. The bank may offer a better interest rate for home loans when the renovation loan is taken as part of the package. Applicants are need to provide the related documents to proof of renovation while the collateral is not needed for renovation loans.

The loan documentation for renovation loans are relatively simple. Normally, it’s entry costs are cheap and funds are released very quick.

Its like other personal loans, most of the renovation loans are calculated by using flat interest rate. But, do take note that Alliance Bank’s Home Complete Renovation loan where the interest is calculated by using the reducing balance method.

renovation loan

Here is an example of how a renovation loan work:

Let say Janice has bought a subsale property with a RM 600k loan from Bank A.

Loan Amount: RM 600,000
Loan Tenure: 30 years
Interest rate: 4.6%
Monthly repayment: RM 3,706

After assessing Janice credibility, Bank A decides to offer the loan a sum of RM 150K to Janice

Loan Tenure: 10 years
Interest rate: 7.6% (Flat rate)
Monthly repayment: RM 2,200

And thus, Janice will need to prepare a RM 5,276 (RM 3,076 +RM 2,200) for monthly repayment. Which means she have to service 2 loans in total.

Now you have not to worry about no money to decorate your house. Do consult the bank for more details.

Source: WMAPROPERTY

It’s not about property ownership it’s about control! To get more details, visit 👉 Property Millionaire Intensive

What Are The Costs Involved When Refinancing Your Property?

It is for this very reason that most of the homeowners and property investors today are looking for methods on how they can increase their finances. Refinancing property can be a far better option! In today, we will tell you what is the costs are involved when you refinancing your property.

So, before you take action in your property refinancing, you would need to take note these several items;

Moving Cost

Ⓐ Moving Cost

This is mentions to money you will need to spend on in changing for a new loan. When you decide to refinance your property, you will need to prepare the extra money to pay for the items such as valuation fees, legal fees, disbursement and stamp duty.

In addition, should you are refinancing the property witht he purpose of save on interest, do take note of this amount and compare it to the savings in interest you will get through refinancing. Fee structure are like property valuation fee, legal fee and stamp duty fee.

Mortgage Lock-in Period

Ⓑ Mortgage Lock-in Period

If you’re ready to pay-off all your outstanding loan amount before the tenure expires, do check whether your existing loan has a lock-in period and whether you’re still bounded by it. For your information, the bank normally would charge a 2% to 5% on your original loan amount for penalty if you doing so.

In addition, if you fully pay-off your mortgage loan within the two to five years, you will then lead to a penalty for early settlement. So this is the meaning of “lock-in period” of your mortgage.

In summary, although you can save lot of money on mortgage loan interest and even able to get additional cash out from refinancing, but you’ll still need to prepare the extra money to pay-off the existing fees such as valuation fees, legal fees, disbursement and stamp duty. Furthermore, you will incur a penalty for early settlement if you get the cash out to fully pay-off your mortgage loan before your tenure expires.

Source: WMAPROPERTY

It’s not about property ownership it’s about control! To get more details, visit 👉 Property Millionaire Intensive

Guides For Home Loan Refinancing In Malaysia

Why should we consider to refinance our home loan or mortgage loan? Let say, if you have difficulty to pay-off your home loan repayment after 5 years or you wish to generate additional cash flow for you to invest in somewhere else, then it is the best choice for you. What does it really mean is, refinancing a home loan or mortgage loan can help you to pay-off an existing outstanding loan as well as replacing it with a new one.

To clear up your doubts, you can get the answer of why you can generate more cash flow for you as below picture;

refinance

Besides, the homeowners and property investors are able to reap benefits from refinancing their loan;

➊ To get the lowest interest rate
➋ The opportunity to shorten the home loan or mortgage loan tenure
➌ To purchase new property
➍ Debt consolidation
➎ To switch the existing mortgage product (Fixed Mortgage term loan, flexi mortgage loans or semi-flexi mortgage loan)

Let’s us thoroughly explain to you each of them;

Residential property

➊ To get the lowest interest rate

If there is a competitor bank offers you a 1% or 2% reduction interest rates, you would save from paying more interests which mean you’ll get the lower monthly repayment. Besides, if you’re rent out the property, you could be able to increase your rental cash flow as the monthly repayment is lower now.

For example, let say your loan amount is RM 500,000 and loan tenure of 30 years

ELR 5.5% ELR 4.5%
Monthly Repayment (RM) 2,839 2,543
Savings (RM) 305
Rental Income (RM) 2,839 2,839
Positive Cash Flow 0 305

Note: ELR is generally known as “Effective Lending Rate”

See? You will get another RM 305 every months! Now you can understand how it can generate additional cash flow for you should you refinance your mortgage loan.

➋ Shorten the mortgage loan tenure

You can shorten your mortgage loan tenure while you refinance your property. This may allow you to have savings on total interest that you need to pay back to the bank.

For example, let say your loan amount is RM 500,000 and ELR on mortgage loan is 4.5%

Loan Tenure 30 years 25 years 20 years
Monthly Repayment (RM) 2,534 2,780 3,164
Total Interest Payable (RM) 404,645 327,810 254,487
Saving vs 30 years tenure (RM) 0 76,835 150,158

 

Do take note that the shorten the loan tenure is, the higher repayment every month. But, if BR or BLR drops in the future, you can then choose to refinance to a shorter tenure by maintaining nearly the same monthly repayments. Which means you are able to pay the same monthly repayments as you’ve always been, but, you can still pay-off your mortgage loan in a shorter period of time.

Note: BR is “Base Rate”; BLR is “Base Lending Rate”

➌ To purchase new property

By refinance your mortgage loan, you are able to cash out from your property to purchase another new property. However, do take note that the cash out should be spent on asset which can generate more income or appreciation for yourself.

The common reason for property investors to cash out from refinancing is to increase property valuation by renovate it. While the reasons for homeowners to do so are to get wedding funds, children education, travel funds, purchase the high cost goods such as furniture, cars and etc.

In sight that most of the banks in Malaysia have offer flexi-mortgage, should you decide to refinance your property with extra cash out and doesn’t know how to spend those funds yet, you may leave it in your flexi-mortgage account in order to save some interest. In this case, you would have backup cash on hand without paying any additional interest on this cash until you utilize it.

Why Invest In Real Estate

➍ Debt consolidation

Mortgage is the cheapest financing options in town which compared to auto-loan or hire purchase, overdraft, credit cards and personal loan. Refer table below on the financing rate comparison.

Mortgage Overdraft Auto Loan Credit Card Personal Loan
Effective Interest Rates (%) 4.4% – 5.0% 5.5% – 6.5% 5.5% – 6.5% 15% – 18% 15% – 20%

 

With regards to debt consolidation, refinancing will help you to have pay-off the debts that their interest rates are higher than mortgage loan. For example, a credit card charges with an effective rate of 15-18% and up to as high as 20% for a personal loan. Comparing to the mortgage interest rate of <5%, credit card and personal loan’s interest rates is like x3-4 more expensive.

A wise consumer will use the refinancing money to pay-off the outstanding amount of credit card or personal loan to enjoy potentially 3 times or up to 4 times interest savings.

➎ Switching the existing mortgage product

Should you’re having a variable rate loan (pegged against BR or BLR) but predict that there will be significant interest rate hikes (for instance higher OPR rate adjustment), it would be better to refinance your mortgage into a fixed rate loans now. As such, your monthly repayment amount does not increase even if increases of BR or BLR .

Alternatively, switching from a fixed-rate loan to a variable rate loan can also be a good financial strategy, especially in a falling interest rate moment. If the interest rates fall continuously, the periodic rate adjustments on BR or BLR will result in decreasing ELR and lower monthly mortgage repayments, wipe out the need to refinance every time rates drop.

So, refinance the mortgage loan is not only the property investors’ game but the homeowner can try out this method to decrease the interest rate on mortgage loan as well as can get additional cash out from refinancing to get honeymoon funds and for your children education funds in the future.

Source: WMAPROPERTY

It’s not about property ownership it’s about control! To get more details, visit 👉 Property Millionaire Intensive

How Much I Can Borrow From Bank?

Before you go for house hunting, you should check on what your maximum loan eligibility is. If you have list this process into your property purchase, you can avoid disappointment at the final stage of the process. So, first, you will need to find out whether you are eligible to borrow the full amount to make the purchase.

I need to tell you that, the loan amount that you’re able to borrow is not based on your salary only, but the bank would list out other several factors into consideration when they assessing your eligibility for borrowing the loan amount that you need to buy your house.

These are the factors besides of salary that determines your loan eligibility;

1. Your Debt Serving Ratio (DSR)

Debt Servicing Ratio is a percentage of the debts that you are servicing over the income that you earned (DSR= commitment/income). For your information, every each bank have different methods of determining your DSR in spite of its based on the same information that you provided.

10 Things Home Buyers Always Do Wrong

2. Risk Profile

Besides of your credit score, the bank will assess your creditworthiness based on job stability, spending habits and etc. The likelihood of defaulting which is your inability to pay-off your debts or service, it is an important factor when you apply for mortgage loan.

3. Property Valuation

Sometimes, a property could be overpriced compare to current market price. So the bank need a property valuator to confirm the property that you’re applying a loan for is worth the money that you are paying for.This is done as in the event of you default , the bank will still be able to compensate the loan amount that you borrowed by selling the property back into the market.

4. Maximum Loan-to-Value (LTV) Ration/ Margin Of Finance You Can Access

Usually, a 90% of LTV ration could be anticipated on a Malaysian mortgage loan. However, if you holding more than 2 housing loans then the LTV ration on the following housing loan is lower and is capped at a 70%. At the same time, LTV rations are even lower for foreigners as these are the restrictions to those that have less attachments to Malaysia.

What is your current age

5. Age

Usually, the period of loan repayments is up to 35 years from the first day of your loan or until you have reached 65 or 70 years old (different bank have different age limit), whichever occurs first. The youngsters who age between 21 to 25 may have a higher chance of getting the housing loan approved compared to somebody in their 60s.

6. Number Of Dependants

The number of dependants can affects your loan eligibility as they would be spending parts of your income. It would also affect your capabilities to pay-off your housing loans. Should you have a spouse and five children dependent solely on your wages it may raise a concern with banks.

7. Your Joint Applicant

The housing loan which is supposed to be borne by you and your joint applicant, hence, the bank would access them to judge your joint creditworthiness before getting your loan application approved. Your relationship with the co-applicant may be matter also, it is less likely for children or parents and or spouses to have disputes compared to other type of relationships such as friends or siblings.

IDEAL Investment

8. Employee or Employer

This information will help the bank to determine whether you have a stable income. A people with full time job, fixed monthly income are considered as more stable. Besides, to those who work for themselves is considered less stable as there is no job security and as their monthly income isn’t fixed.

9. Past Relationships With Bank

The applicants who are loyal customers of the bank they are applying to may have an added advantage. However, if you’re not, not fret, as long as you don’t have significant conflicts with any banks or being blacklisted from any banks.

In addition, when you’re planning for  buying a house, it is advisable to have enough money to pay the deposit, valuation fees, documentation fees, legal fees and stamp duties on the housing loan. For your information, some of the banks can provide up to 5% (for insurance) and 2% (for legal fees) additional margin of finance to finance your valuation and documentation costs.

Last but not least, before buying a house, you should find out what the maximum loan amount that you can borrow from bank.

Source: WMAPROPERTY

It’s not about property ownership it’s about control! To get more details, visit 👉 Property Millionaire Intensive

What Are The Property Loans That Applicable In Malaysia

Whether you are homeowner or property investor, you should know more about this topic than we do. While, for the newbies on property purchase (first-time housebuyer), this article will be very helpful as you can understand what type of property loans that exist in Malaysia and you can defined which type of property loan that is suitable for your financials. Let’s get started!

Loan with Fixed Interest rate

① Loan with Fixed Interest rate

This is the common term loan in Malaysia which have a fixed interest rate throughout the loan tenure. This term loan is usually offered by insurance company. This type of loan is extremely useful for the people who purchase the property with the purpose of investment, as they can predict how much profits they can get from that property itself in following years. However, nothing is perfect. The negativity of this loan is inflexible which mean there is no early settlement for repayment allowed.

Image source: WallStreetJourney

② Loan with Floating Rate

This term loan is based on a reference rate such as BLR, BFR, OPR and KLIBOR that could change over the duration of the loan tenure. While, this reference rate is controlled by the bank or current market and could be changed at the moment’s notice, it will affect a loan’s interest calculation which means it could affect your monthly repayment amount and loan tenure. Hence, this term loam is quite risky as you will be exposed to changes in the BLR which is beyond your control.

Overdrafts

③ Overdrafts (OD)

Overdraft is a line of credit and accessed through a current account with no fixed monthly repayment. Normally, am applicant can only withdraw as much money as he/she has in his account. However, with the facilities of OD, an applicant is able to withdraw the amount that more than the available amount in his/her current account, it is depends on he/she setting the credit limit during the signing process. Do aware that some of the bank will charge a small amount for commitment fee (normally 1% of your un-utilized amount) even if you don’t exploit your line of credit. Hence, make sure you’re fully understand the terms and conditions of its agreement.

Combination of Loan and Overdraft

④ Combination of Loan and Overdraft

You can get the lower interest costs and enjoy the flexibility at the same time by combination of both loans and overdraft. Let say, your mortgage loan is about RM 100K and you are able to take RM 75K as a loan and the balance of RM 25K will be an overdraft. Besides, how you can do such split is depend on how fast you can clear-off the overdraft portion within the next 2 to 3 years. Let say you can save up to RM 1K every month, then your overdraft portion should be around RM 24K and RM 36K.

Once you have understand the above 4 type of loans then you’re good to go for apply a loan to purchase a property. Remember, always compare the interest rate that offered by different banks and check on which bank offer you a lower interest rate or better loan package that suit to your current financial status.

Source: WMAPROPERTY

It’s not about property ownership it’s about control! To get more details, visit 👉 Property Millionaire Intensive

Find Out How Much You Can Borrow Based On Your DSR

Before purchasing any properties, this is important to find out how much you can borrow from bank which based on your Debts Servicing Ratio (generally known as DSR). To get a quick answer of this, you may skip straight to online housing loan eligibility calculator. If you want to learn more about how its actually calculated, continue read on to get more detailed guidance.

4 Key Factors That Determine The Maximum Loan Amount You Can Borrow

You can borrow how much loan amount is depends on these 4 key factors;

  1. Your Debt Servicing Ratio (DSR)
  2. An individual’s risk profile
  3. Property valuation
  4. The max Loan-to-Value (LTV) ratio / Margin of Finance available to you

How Much I Can Borrow From Bank

This article is only covers the DSR factors, and we will first list out some common misconceptions;

⓵ You can only get the loan up to 1/3 of your gross income from bank

In fact, the bank will use more refined rules set during credit approval.

⓶ The differences of max borrowing amounts from each bank is not so much

In fact, the credit policies can differ greatly from one bank to another. Max borrowing amounts can even differ up to 3x between different banks.

⓷ Bank only approve up to 70% of your DSR 

This is only another rule of thumb and not particularly exact.

Debt Servicing Ratio (DSR)

Debt Servicing Ratio (DSR)

The DSR is shows how much of an individual income is used to pay debt installments and it represented as a % of income. It is derived from 2 main components as below

DSR = Commitment / Income

For your information, every each bank have different methods of determining your DSR in spite of its based on the same information that you provided. This is because every each bank has their own calculation methods for income and commitment recognition.

Example 1: Standard Chartered Bank may based on their calculations on Gross Income, while RHB and Maybank may based on on Net Income.

Example 2: CIMB and HSBC may recognize 100% of rental income, while Public bank and OCBC may only recognize only 80%.

Example 3: RHB recognizes only 45% of foreign derived income, while Hong Leong Bank is considers 100% of it

It is not unheard of that when different banks calculate the DSR for the same person, there can be DSR differences of up to 20%! But the differences do not stop there.

Once your DSR has been determined, every each bank will have their own guidelines for mas allowable DSR threshold. It is usually determined by level of income, however, it may also be affect by net worth and even things as random as qualifications and ages. Some example bank guidelines:

Income Bank A Max allowable DSR Bank B Max allowable DSR
< RM3000 60% of Net Income 60% of Net Income (+10% if professional)
< RM6000 70% of Net Income 70% of Net Income (+10% if professional)
< RM10,000 75% of Net Income 80% of Net Income (+10% if professional)
> RM10,000 80% of Net Income 90% of Net Income (+10% if professional)

Source: Loanstreet

Know Your Max Borrowing Eligibility

Sometimes, it can be very difficult to determine what is the maximum of loan amounts that you can borrow from bank if you’re not often up-to-date with the credit guidelines of each bank in Malaysia.

So, once you’ve get the result of how much you can borrow, you can then search for the best loans available in Malaysia and proceed with house purchase.

Source: WMAPROPERTY

It’s not about property ownership it’s about control! To get more details, visit 👉 Property Millionaire Intensive

5 Simple Tips For New Property Investor

When you have additional money for yourself can do anything else. The best option to spend those money is to invest in property as it always have high returns over times. Although the price of property is not cheap and even go up and down sometimes, but they appreciate substantially in the long run.

Investing in property is something that you can rely on because the value of property itself will increase with the development of the areas nearby property. In fact, there is still have existing risks that cannot be ignored. But if you invest in the right ways, right timing and right property, you can then decrease the risks.

If you’re new to property investment, you may seem daunting at first. But,no fret! Here are 5 simple tips to help you out to make the right investment choice;

Residential Properties vs Commercial Properties

1. What type of property you would like to invest in

You would need to choose whether you want to invest in commercial property or residential property. There are many options to invest in such as SOHO, serviced apartment, landed house or condos. So, you need to take some times to study which is better for you, the most importantly is stay within your budget.

2. Why investing in property

Do you want to be a property flipper or landlord? You can make significant profits by make the property flip a flop which is where you buy a property, renovate or decorate it, and sell it at higher price, but its quite risky and its require the certain skills and experiences. Alternatively, you can buy a property and rent it out to earn passive income. Besides, if you plan to invest in commercial property, you can then hold it until the price of property itself has increase and sell or you can leases to long-term tenants to make a good profits.

property location

3. Where to invest

Its all about location, location and location, while you invest in any properties. The price of the property is likely to be decided by where its located. Before buying any property for investment, do make sure you have do the research on price trends which according to different locations. You can read this article to decide where to invest. (3 Tips For Deciding A Property Location)

4. Who are the person you need on buying a investment property

You can make your job easier on searching the type of property that you wanted by network with a property agent. It is because they can help you toward investment property that fit to your requirements, plans, and budget. Besides, a property broker can handle over legal matters that is involved with the sale and purchase of the property for you.

Do engage with a licensed agent who is able to give you the proper guidance on any legal procedures and paperwork submission.

buy within limits

5. It’s time to arrange your financial

Once you have decide to buy an investment property, you would need to get the mortgage loan from bank. And do remember to keep all the receipts and documents in well condition for in case.

In conclusion, the most important thing you need to do is do your research! Don’t urge yourself to getting in property investment as it may make yourself lose money. So, wish you good luck and success in property investment field.

Source: WMAPROPERTY

It’s not about property ownership it’s about control! To get more details, visit 👉 Property Millionaire Intensive

S&P Agreement: What It’s Process In Malaysia?

Every house buyers should understand what is the meaning of S&P Agreement, and how its so important during property purchase. If you don’t know it, do read our previous article: What Is S&P Agreement. Besides, if you never buy a house before or plan to buy a house in Malaysia, then this article you should not miss as we will telling you what its process during property purchase;

Solicitor

The first thing you need to do is Get A Solicitor, you can choose, either

  • Buyer and seller use the same solicitor
  • Buyer and seller hire different solicitor

Let’s talk about how if the buyer and seller use the same solicitor;

The buyer is being protected while the seller isn’t which means that the solicitor will focus on the buyer’s perspective and charge the sellers for basic processing fee. In such case, the processing fee will be very minimum, i.e.g ~ 80% which is lesser.

On the other hand, should the buyer and seller hire different solicitor, both parties will be protected by their own solicitor. That means the process will take a little bit longer as it will take a lot of back and forth official communication to make sure both parties interest are protected. For example, seller’s solicitor drafts the S&P Agreement and the buyer’s solicitor will check on it. If there is some terms are incorrect, the buyer’s solicitor will return its agreement to seller’s solicitor for amendment.

I believe that you’re wondering which one is better. However, it is more on the seller’s choice while the buyer is more or less the same. In brief, you can choose the first one should you trust the solicitor (the solicitor could be side with the seller and din’t explain the agreements to you clearly) or you want to save cost.

agreements

The Process of S&P Agreement

Ⓐ Letter Option to Purchase (prepare a 2% deposit )

This is a letter from seller to buyer. The buyer will need to pay a 2% deposit of the property purchase price (its decide by seller) upon signing this letter. You can either pay check or cash to the seller. Besides, should you have a property agent, the agent will drafts this letter for you. If you don’t, get a solicitor to drafts this letter for you.

After you have signed this letter, the S&P Agreement must be signed within 14 days. Within this period, the buyer usually will apply bank loan. Should the bank rejected buyer’s loan application, then the buyer can void this letter and get back the 2% deposit.

Ⓑ Signing S&P Agreement (prepare a 8% deposit)

After the letter option to purchase is signed, within 14 days, you will need to pay the remaining 8% to the seller;s solicitor upon signing this agreement. In some cases that the buyer reject to sign this agreement, the seller can take the deposit and looking for other buyer.

When the seller’s solicitor receive the remaining 8% deposit, they usually will withhold a 2% for Real Property Gains Tax (generally knows as RPGT) which is requirement by the law and pass the remaining 6% to the seller. From seller’s perspective, you will get a 8% (i.e. 2% + 6%) of the total property purchase price. The solicitor will in-charge the seller’s RPGT matters with the income tax office.

Ⓒ Completion of S&P Agreement (prepare remaining 90%)

After the the above 2 processes are completed, the buyer usually has 3 months period to pay the remaining 90% of the property purchase price to the seller. Should the seller has any loan, then the buyer must settle the loan on behalf of the seller within this 3 months, and these process will gone through the solicitor. But, should the buyer failed to pay the remaining 90% after 3 months, the seller have the rights to charge the buyer a 6% of interest.

In conclusion, should you have a property agent you will then need to pay for agent fee. It is depends on your agreement with your agent regarding how much you need to pay or follow the standard cost in the state (cost is different by state). In some cases, the agent would ask you to pay the agent fee upon signing the S&P Agreement. However, it is advisable to only pay them until whole process is completed which is after 3.5 months. You may negotiate this matter with your agent.

Last but not least, there is not compulsory to have an agent to in-charge over buy or sell matters, but you must hire a solicitor that you can trust on as well as able to protect your interest. Let us know should you have any questions. Good Luck.

Source: WMAPROPERTY

It’s not about property ownership it’s about control! To get more details, visit 👉 Property Millionaire Intensive

These Are The Things That You Should Consider When Choosing A House To Live With Your Family

There are a bunch of things you will need to concerns about before you buying a new home to settle down your family. You will need to make a hard decision when you have your own kids, and you will need a place with more convenience and less risk to make sure their safety.

Let’s take a look at the common factors that the parents should focus on when choosing a house to live with their family, especially their kids;

House Location

1. House Location

If you are single, you are probably only focus on location, “is this place near to my workplace?”. However, if you’ve had upgraded to be a parent, you have to consider the distance between the house and school, amenities, even babysitter or your parents and siblings.

In addition, you will need to consider that you want to raised up your kids in what type of ethnic culture of the location. Hence, this part is often took a little longer to do the planning and research. Do figure out the cost, time, distance and transportation convenience.

House Price

2. House Price

Whether you buy house to settle down your family or for yourself, price is always then main concern for choosing a house. Besides, the house price is depends on a location or whether it is a newly developed building or a sub-sale property. Do understand that what is your affordability would help you to narrow the options of choosing a house.

In order to minimize your repayment default risks, it is advisable to set only one out of third of your net salary (after taxes and dedections) for monthly loan repayments. Do remember to included all of your other commitments such as credit card, car loan or personal loan. By doing this, you will have a more realistic picture of what you can afford and what you can’t.

House Type

3. House Type

What type of house that you prefer the most? High-rise property or landed property? Will this house can cater all of my family members? Will it packed? This is the most common questions that you should be answered by yourself and do discuss with your spouse about this.

Besides, do focus on eliminating options with constructs that are not suitable for children. Do note that the common house hazards are include staircase, balcony, low ventilation, exposed pipes, and other things that might harm your little ones. Well, you can solve these issues by renovate the house, however, it is only an option if your budget allow you to do so.

Education

4. Kids Education

What is the location you would like to live in? nearby a famous school? the place that easily accessed by highways or other transportation? These are the top priority concerns for the parents. Hence, you may choose the house that close to the education centres, and it would be a great choice for working parents who can’t catch up their kids after school.

Furthermore, having a top-notch schools in the vicinity of new developments may attract more young families to move in. But, this point may not often considered by some parents, but it is a quite interesting way to foster a community that grows together and make their children’s benefits as their priority.

Safety of Environment

5. Safety of Environment

This is also a main concern for parents when they chooosing a house to live in. However, the location comes with gates and guarded communities is tends to be pricier and it might not an option for all family.

In fact, you should no worry so much about if your house outside of guarded space, you can install a security system in your house such as sensors, CCTV and home alarms.

Amenities

6. Living Lifestyle and Amenities

Imagine that you move in a newly developed township but far away from grocery stores, restaurants, hospital and clinics. Its very inconvenience for you and your family right?

Hence, you should be consider where available and affordable. In close proximity to a parks, playgrounds and shopping centres are healthy setting for family gathering during weekend. In addition, a place equipped with the facilities like swimming pools, jogging, cycling or other activities would make for livelier for your and your family.

Last but not least, choosing a house can be difficult sometimes. But if you choosing a house based on your family members, living style, financials, amenities and etc, you will easily to make the decision of which place is suitable for you and your family.

Source: WMAPROPERTY

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