when u received the claims of LPI (late payment interest) letter from the vendor's lawyer.

can you quote the whole clause?

It easier to tell that way. thx

i'm not very sure about govt loan, but here what i can tell from my understanding of the terms;

1)Completion time = usually refers to the completion of a under-construction property or development. In this scenario, loan would have been fully disbursed from your financier.

but i'm a little confused with your question;

1)last date of interest-free period
-does govt loan offers interest-free-period if the loan is not fully disburse? the last i remember govt loan is only applicable to completed units.

2)... refers to the date that my loan is 'approved' or that i actually physically deposit the money into the vendor's account?
-sorry but i dont really get ur question here...



To make it easier... just take out the one in brackets.

I've also highlighted the points, so that u'll get a better picture

The balance of the Purchase Price amounting to RMXXX only shall be paid by the Purchaser to the Vendor’s Solicitors as stakeholders within three (3) months from the date of receipt of the said Consent by the Purchaser’s Solicitors, failing which the Vendor shall grant to the Purchaser an extension of two (2) months to pay the Balance Purchase Price in which event the Purchaser shall pay to the Vendor an agreed interest on the unpaid balance at the rate of eight per centum (8%) per annum to be calculated on daily basis from the expiry of the Completion Date to the date of payment.

In other words, the balance of the transaction price of the property has to be settled within 3 months time, from the date of the said consent (which refers to the SPA). If you failed to settled the outstanding balance within the 3 months time, your vendor can grant you an extension of additional 2 months time, which the remaining balance will be charged on the agreed interest rate, calculating on daily rest basis from the 1st day of the 2 months window.

assuming SPA signed on the 1st of Jan, transaction price is at RM 300k;
Day 1 = 10% deposit paid. (RM30k)
Day 90 = paid another 60% (180k). Current amount paid is 70% (RM 210k). outstanding 30% (RM 90k)

Interest will be charged at (assuming) 10% per annum on daily rest basis, so we'll calculate using daily rest formula;
X = outstanding amount (RM 90k)
I = interest rate (10% pa)
D = number of days (15 days)

[(X x I)/365] x D

LPI = [(RM 90k x 10%)/365] x 15 days
= [(9k)/365] x 15
=[24.65] x 15
=369.75

So on the day 105, when you settled the remaining 30% you are also require to pay an additional of RM 369.75 as LPI.

However, if you do not settle the sum within the 2 months time frame, the vendor has their right to cancel the purchasing.

hope these help...

This post has been edited by merce: Mar 7 2010, 03:38 PM