Dear fellow sifu,

Just wanted to get some opinion as I am planning to purchased an auction property for my dad ( old terrace house only). I really have no experience regarding auction. So far I have ask my lawyer to do a land search and I have submitted my documents to the bank for loan approval. Bank says ok but still waiting for the lawyer's reply.

Is there anything I should be aware off?? Really sounds scary la so far after I read the terms and condition for auction. Hope some sifu can guide me.

Thanks in advance

I believe there is a threat on this.
Could you try to search for it.

You could get tons of info from there

are you merely in the stage of "planning" to buy or already sucessfully bidded?

well, if u r still in the early stage of "researching", do proper land search, site visiting to ensure condition of the Property as well as "to know" the tenants.

if u were a successful bidder, the auction process will be simpler if the house comes with a title (same still under master title), as every important documents will be safely placed in the possession of Land office or Court, lawyers just need to do the necessary at the end to get Bank to release payment, not so hassle transaction.

Just monitor closely the transaction, follow up promptly with ur lawyer. good luck!

Thanks for the advice guys. Appreciate it.
I haven bid yet as the auction date is next month. I went and saw the house already. A bit old but I dont mind la. But saw some people staying inside wor. Auction property still can have tenant??

yeah its possible they're finishing their term

heard some people went to auction. managed to bid, paid the deposit. but in the end, the children or maybe the 'people that being owed money by the seller' can caveat the property.

what happens then? anybody know whether can get back deposit?

From what I heard , thats why we do land search make sure no caveat etc...Just worried got other problems besides that. Anyway want to try for experience only la. Will let u guys know hows the process after that.
Anyway got not much budget so don think will win the bid anyway.
Coz the way I see it, if buying from auction, the property must be cheaper by at least 30-40% below market then only worth going through the hassle and take the risk. Estimating 20% out of the 30-40% u saved to pay agent, fix up the house, lawyer fees etc etc. Never know what out standing bills some more.

If cannot get 30% below market then I wont go for it la. Let other crazy fella buy it.

this reason alone, you should stay away from the property
if you insist, talk to the people staying inside politely, tell them that the property is being auctioned. see if they have the intention not to leave. it is troublesome to vacant the people in there.
good luck

Really ah?? How la to get rid of tenant b4 auction?? Do they have the right to stay there in first place since they practically dont owned it anymore??? Aiyo scary la like that. Can ask them to leave after i have successfully bid for the house??

you can ask them to leave, but whether they leave or not is another story...even if you are the legal owner of the property, what are u going to do?

lawyer latter? report police? go ahead, they are just not moving out

worst case is when there are woman and small kids, they cry and beg you dont chase them out because the husband has gamble all their money and cannot afford to pay the bank thats why the house got auction. are you going to mercilessly continue chasing them out?

Means they also cant do anything if i ask contractor to totally renovate the house when they r staying inside there?? I tile whole house slowly, remove electricity, water etc.. sure they will move out by then right..

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Added on February 28, 2011, 8:53 pmActually I went and saw the house. Dont look like malay family when i read the Proclaimation of sales, the actual owner is a malay.. Can I go talk to the tenant. I really confuse as , if the owner got a tenant sure he can afford monthly repayment what..My assumption only la..

But Property101, I really appreciate ur advice and views. really

This post has been edited by henryhing: Feb 28 2011, 08:53 PM

If the Auction property... usually it stated 'as is"

I encounter same situation. However I'm lucky, they willing to move out.

Another note. Please prepare some cash to pay out pending bills.
Potientially to grow to a big sum

What sum must pay??

check the fridge, make sure got no dead body inside. like the auction condo last time, the new buyer had a free *gift* in the fridge.

Yea you really have to ask yourself why the bank is not selling it the conventional way, or keeping it as an investment.

Know the market first.

Nowadays too many uncle aunty bid the property to a price way beyond market price, so wat's the point?

Thanks guys.. Wah buying property from auction really stress. Now only realise besides the 10% & lawyer fees, I must pay 1% agent fees as well. Coz I thought only when selling or renting out must pay agent fees.
I really hope got no dead body la....If got i quickly throw out of the house then only report police la...

hahahaha.. classic case of auction property... n now everyone remembers it..

not allow to view auction properties... how to check d fridge..?

i'm not discouraging you from going for auction property, but want to make sure you are aware of all the risk before you go for it.

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Added on March 1, 2011, 7:25 pmSome banks will offer to pay for the bills until the date of the property being auctioned off

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Added on March 1, 2011, 7:27 pmright, sometimes a property will be bid till higher than market price. either the bidders are really getting too emotional or in they really cannot find another identical unit in the market.

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Added on March 1, 2011, 7:29 pmSuggest you invest in a book before invest in a property
http://www.bookplanet.com.my/index.php?tar...s&product_id=59

This post has been edited by property101: Mar 1 2011, 07:29 PM

An auction property is
- Sold on 'as is where is' basis.
- Doesn't guarantee delivery of vacant possession.
- Can be withdrawn from auction anytime b4 the session begin.
- Caveat = Cannot get bank loan, must pay balance with own money.

Pending bill as follows
- Electricity
- Water
- Indah Water
- Accessment
- Quit Rent
- TM or Maxis fixed line ??

Goodness gracious..But heard that cukai pintu and tanah will be beared by the bank auctioning the property.. Is it true??

Differ from case-to-case, bank-to-bank.

Ultimately, grab a copy of the POS & read from the 1st letter till the last sentence. There's no shortcut.

addition to scorgio.
I understand there is High Court Auction and Bank Auction.
Not sure how different are they

Usually property already with title will take place at High Court or Land Office.

Property without title will take place at auctioneer's office or a designated location.

Mine is in Jalan Duta high court. What to pay attention fron the POS???

POS stands for Proclamation of Sale.

If you don't know what's that, suggest u quit on auction property b4 u dig urself a big hole.

Agreed!

There are two types of Auctions. One is known as high court/land office and the other LACA (loan cum assisngment). LACA only when the master title is not split into individual titles or strata titles.

For high court auction, banks will absorb quit rent and assessment as both are required for a transfer to take place. However, service maintenance, late interests varies and you need to read the POS carefully.

Now, this is where it gets interesting. Rightful owner, beneficial owner and succesful bidders have different rights. You will be bidding for the property which means you have no rights to the property at the moment. Bidding for it doesn't mean you will definitely win. Hence you have no rights to knock on the door and ask the "tenant" or the "owner" to leave. Personally, I have knocked on doors before signalling the resident my intention to bid for the property. It will give you a rough gauge of how hard it might be to chase them away later if you did win. Most of the time, if it is tenants residing, they would tend to coperate and some would ask me to rent them the unit once I buy over. I tend to minimise further any damage by giving them the same rent as they are paying to their current landlord. But beware, some would lie and then you need to inform them the real market rental rates.

Caveat is not as simple as you think. You cannot simply lodge a caveat. A caveat would not prevent a transfer, just create more hassle for you to remove it. If you suffer losses as a result of a negligent caveat, you can even sue the person who lodge the improper caveat. for high court cases, normally it is quite safe to buy even though there are caveats. Remember, the banks always win.

You do not need to pay 1% to an agent for auction cases. In many cases, these agents are paid by the banks. A simple courteous note to your agent telling him/her you will need to consult the auctioning bank regarding the agents fees, they would freak out as they would be blacklisted by the auctioning bank.

Buying auction properties in the past could make money as most would end up 15-20% cheaper than market values. Looking for 30-40% would only happen in undesired locations. but these days, perhaps the market is flushed with money, occasionally auction properties might end up higher than the market value by 5-10%. Why? Auction can be a very emotional event. In the midst of wanting to win, you might exceed your budget.

If you are planning on going to the said auction, I wish you all the best.

Good info michael.

Agree with you. I got mine, 3-5 years ago around 20% below market price.

Well said, mate

i have successfully bid for 2 props in auction. and have turned out ok for me at the end.
1) owner refuse to shift out.... when they did.6mths later...they remove everything incl. the grilles and awning. luckily didn't sabo the plumbing. also had to pay syabas 900+ for unpaid bills and 800+ for TNB. if not cannot get supply .( ()(*&^%$ blooddy bullies)
should have made a rquest to syabas and TNB to disconnect supply, not risk serious demage to hse.
documents took 1 yr to complete, lucky had prepared with cash to stand-by, if ask extention of time bank will charge interest on outstanding 6-8%pa. and have to pay for 3mths inadvance.
2) next unit bought 40K vacant . documents still in process but paid in cash first. renovated 10K and rented out. rm300...ROI 7%

do yr homework to know the market ....have cash in hand for unseen expenses..

Outstanding check for below:
Land Office;
Local Authority e.g. DBKL, MBSJ etc..;
TNB;
Syabas; and
Telekom

House issue check for below:
Termite;
Water Piping;
Leakage of water;
Electrical Wiring; and
Wall and Floor Tiles

Housing Area got floating? If so please leave it..

normally for auction, u would be able to view the inside of unit. if u can mostly the unit is vacant/abandoned, so unit would be in verybad shape.
i would set a "target price" apprx.30% below market of that area. cos u have to take it that a huge budget (CASH) (not more then d 30%) to renovate the hse.
but if u like the location slightly higher then add in the reno cost to get same market would be safe.
on top of all this the stress to get documentation done ..ohhh the bank laywers can delay and no panelty for them but the burden on buyer.

No doubt the bank lawyers can be quite efficient at delaying you (the longer they drag, the more interests they can charge to the previous borrower) and sad to say, I personally have been given first hand experience with Maybank. I was rather inexperience then and thought that by using Maybank as my bank, I could save time but I was wrong. being inexperience, I had to pay the balance post auction 120 days with cash. Of course I do not allow it to happen again. There are many ways to protect yourself and I am sorry I shall not share the methods and the best person to give you advice is of course your lawyer.

BTW, for auction properties I read someone paid RM800 for outstanding TNB bills. Actually for. TNB you do not need to pay. All you need to do is to create a new account. They would not blacklist you for other people's outstanding. If you have problems with that, feel free to contact Che Khalid. I am sure he will be happy to assist you. hehehe

Oh goodness ur reading or iQ must be poor..I mentioned POS few times. U said to read the POS properly..What to read that is confusing in the POS??? Address, plaintiff, defendant etc..What specifically is deceiving in the POS must read from begining to end without missing a word???

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Added on March 2, 2011, 7:55 pmNow this is the writing of a person with knowledge..Not flamming people without reading properly. There is vast difference between what is POS and whats to read from POS...

Thanks Michaelee

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Added on March 2, 2011, 8:20 pmWent for auction today..reserve price 486,000..Loss to one bidder who got carried away who won the bid at 700,000. Still cheap for corner house in subang jaya if for own stay but for investor its not worth it. Anyway the owner of the property turned up and pleaded that the property to be withdrawn for some reason which the judge & lawyer didnt accept. Really sad to see the owner in his 50s or 60s pleading for court to give him chance to withdraw the auction. Said he is still staying there and no where to go.. My heart suddently felt sad. But anyway dont think the winner of the bid should celebrate as yet as I believe the owner whom is also a tenant would just pack and leave like that. Believe he would file another case in the high court...will be messy if thats the case

This post has been edited by henryhing: Mar 2 2011, 08:21 PM

For people who're lazy to do their own homework.
Why should I assist?
It'll be good to have more ppl dig themselves a hole & I get the chance to gain from their losses.

I always asked my friends who wants to try their luck with auction to go and test the water. Set the budget a bit lower to get a feel. Owner coming to auction has been a trick of the book from ages ago. Unfortunately you should not sympathise this fella. Afterall, he did not pay the bank. Everyone has their own problems.

Once an auction property has gone through the hammer in high court, there is no way the borrower can reverse unless of course if he can prove there are irregularities. he might have a fighting chance if he has valid reasons before the auction.

Thanks michaelee.. I really did learn alot from this auction...No wonder many people prefer to buy from open market rather than auction. Less Ma Fan...hehe..

OMG Scorgio...can't believe u la..NVM thanks anyway..

People who truly makes money from properties are those who purchase from auctions or distress properties. It is a simple equation of higher risks higher return. Trust me, the first auction that you have succesfully bid for will only spur you further to look at other auctions. The only subsale deal I have done are those who have owed quite a bit of money. If you know your way around, "people" will tell you which properties are in distress. I hope I won't be showing off by saying this. My average capital gains in the past 5 years base on acquisition price against my selling price has been slightly over 100%. My yield against total acquisition price and incidentals (purchase, renovation, legal, finishings) is in the region of 14% and my ROI is nearly 30%. Impossible?

Good luck to you and wishing you all the success in properties.

Hi Michael...thanks for the encouragement and advice..Btw if you come across anything hope you can let me know too..will belanja u makan..cheers

undertstand if i succeded auctioned a condo , i need to start paying the maintenance fee the next day after the auction date. if the condo are rented, that mean the rental will be collected by foresales owner while i have to pay maintenance fee on his behalf for few months b4 i become the owner??

Now here's the tricky part. Yes you need to pay maintenance straight away after you win the auction. Actually the old owner has no right to collect rental. Unfortunately most banks did not ask previous owner to sign assignment of rental otherwise the bank has a right to collect rental. You don't have a right either. If I am the tenant I will pay to no one. But a trick I use is to scarf the tenant telling them to pay me immediately. Failing which upon transfer, I will kick them out. It has worked well so far.

After reading this thread, I'd like to praise Micheal for his genuine and helpful replies. Just one question Micheal, what documents did you receive after redemption? As far as I know, there will only be a temporary contract after your successful bidding. Did you get to receive your title, floor plan, etc? Thanks.

Thank you. For auction property it is crudely call paying up rather than redemption. Once we have paid the auction bank the balance of the successful bidding price, the lawyer will arrange for a transfer. If it is high court, it is quite easy as the auctioning bank would have most documents ready and being approved by the courts, transfer can take place quite fast. You will be given your title (or a copy if you charge it to the bank). Floor plans are not included in those documents. you need to contact the management office for a sample floor plan. However, some offices might take a little bit more effort in asking for it.

For LACA cases (and in high rise) it could be a little more difficult. Having a good lawyer is of vast importance as a clumsy lawyer could screw up your timing, and hence you might not be able to draw down by 90 or 120 days (depending on POS). Once that happens, you need to come up with the cash to pay up the balaence. Again, this would not be good especially for the investors as once you have the ability to pay up, then you cannot claim interests payable against tax.

The temporary contract is called Memorandum of sales is actually quite an important document and it is not temporary. In some ways, that is the "SPA".

Hope the above helps.

can we start to renovate/move in the units if the unit is empty /bare new while waiting for transfer? the management office allowed me to engaged locksmith to change keys etc.

i think the developer dun care since the unit oredi paid up.
it is the problem btw old/new owner and the bank. i dun think the bank oso care much... since i use the same bank for loan.

It depends on how daring you are. Since the property is not yours just yet, and in case it cannot be transferred, whatever you put in will be someone else's. So you might end up renovating for someone else.

very true

can i get back my 10% if failed to transferred? my lawyer once i got the DOA signed from bank, i will be the new owner.

fyi, my auctioned prop is freehold partly furnished condo in KL. it is still new and just VP-ed. (with 18 months defects rectification guarantee)

can i just install lightings, matress and move in?? the unit came with air cons, heaters, kitchen cabinets, cooker+hood, wash machine, wardrobes etc. so i break any law if i move in? I have all the access cards/keys etc

A bank never loses. When you give your 10% it is not refundable unless it is the fault of bank or auctioneer. With LACA cases, you need to be very careful as to who the developer is. You need developer consent for all transaction. If a developer liquidates, I don't know what are the process for transfer. Could be tough. I have one case hanging from 2005 until now. But I have collect enough rental and the previous owners do not give a damn.

You need to becareful with the 18 months defect guarantee as the developer signed the SPA with the previous owner. They might not be obligated to fix it for you. Just like deed of covenants. Those who purchase via auction will not sign one. So I always tell the management, it is really up to me to cooperate with them. If they are nasty to me, i would not be cooperative. A lot of management companies fail very badly with the Strata Title Act and Building and Common Property Act (maintenance and management) 2007. Both are very un-detail, probably less than 100 pages but yet no one bothers to read them.

Thanks. It does help.

hav u sign the agreement??

wat agreement?? i only signed POS contract with auctioner on the spot. will then sign DOA with bank loan.

the developer is a reputable one, transaction consent shud be no problem.

oso, maintenance office agreed to repair all defects for me. I hv submitted the defects form.

i think i just do minor fixing and move in and start enjoy condo facilities. (since i need to pay for the monthly maintenance fee)
will do major reno after transaction completed.

If they are 3 management office from 1998 until now, do I need to pay for the Maint fee for all the Maint fee from 3 diff management office or I just pay for the last management office??

Why it affect the developer consent since the management office not under developer anymore? Thanks..

I am involved in a lawsuit against a management company with what you have said above, so I cannot comment about my suit. At current level, yes, you need to pay all 3 different management as you are owing the "community" not a company.

Is the title still under master or it has strata title already? If there is strata title, then developer not involved, so you do not even need developer's consent.

Hi Michaellee, just need an advice. Is there any drawback to get an auction property under master title as compared to strata title??

This post has been edited by henryhing: Apr 27 2011, 07:27 PM

however, the "community" didnt take care about my unit. i don't know why i still need to pay for them..

May I know more about ur law suit? or can u pm me more detail? i not sure i shld go for law suit or not..

How can i check the condo is under master title or strata title?

Thanks again!!

There shouldn't be any drawback. In fact for some of the properties under master title, you can claim outstanding maintenance fees from the auctioning bank (but do read the POS carefully as some banks nowadays do "cheat" and not pay). However, one most important thing about auctioning under master title is to make sure the developer is NOT bankrupt as it can be problematic for your transfer as you do need developer's consent.

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Added on April 27, 2011, 10:33 pmUnfortunately this is something I cannot share but if I have the opportunity to share in future, I would. I wouldn't advise you to sue though. The best way is to ask the management if it is under master or strata title. If you would want to share with me in private your case, perhaps I could share my opinion. Cheers.

This post has been edited by michaellee: Apr 27 2011, 10:33 PM

No matter the property under strata title or master title, we can only follow the POS, isnt it?

If the POS says it can only claim 10%, no matter strata title or master title can only claim 10%, isnt it?

& if the POS says it can be claim until the date of sale, no matter strata title or master title can claim all the arrear until the date of sale, isnt it?

Thanks, master michaellee!!

Thanks michael..ur of great help. D consent part is worrying a bit. What i am worried is that if i put in 10% and won the bid but eventually i cant obtain consent since the auction is not in high court, then my 10% considered burn..Although it is a rare case but im not a big risk taker la. coward a bit in that sense

If u can't get the consent, I think the bank will pay back ur deposit since it's not ur fault and I think the pos/cos hv written this in their agreement..

No worries. I try to help where I can. Yes, if you cannot get consent by the stipulated date, you might be in for a bit of a trouble. Unless you have cash to settle the balance sum, your bank may not release money.

Personally, I am on good terms with quite a number of developers and hence a lot easier when performing tasks. But still, there are quite a few cases where I had to go all the way until the last minute (4pm of the last day without any interest penalty) by screwing the auctioning bank, auctioning bank's lawyer and developer. At the end of the day, the cheap property makes it all worth while.

Hopefully you can find a property that you like soon! Good luck in your property hunting.

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Added on April 28, 2011, 3:24 pmUnfortunately that is not so. The risks is on you as a purchaser. The bank will not be responsible for any lapses in transfer.

This post has been edited by michaellee: Apr 28 2011, 03:24 PM

If we cannot settle in 3 month times, can we request EOT with 0%?

Yes you can and it is definitely worth a try. But having said that, the bank may give you another 30 days and thereafter 8% pa interest. Just becareful with LACA auction.

May I know if the management office not register under mpaj(ampang), do I still need to pay management fee? Thanks..

What do you mean? Buildings are under Commisioners of Buildings.

It's bcos I write email to the consumer association under government sector and he reply to me

2.            At the same time, you may also check with the Local Authority, i.e.  Majlis Perbandaran Ampang Jaya (MPAJ) which oversees the area covered ( the premises being situated at Pandan Mewah), whether Badan Pengurusan Kondominium Mewah Heights is licenced or not.  If it is not registered, then you'll be further advised to report to:

                                                               THE REGISTRAR
                                                                BOARD OF VALUERS, APPRAISERS AND ESTATE AGENT     MALAYSIA
                                                                A-27-15, Level 27, Menara UOA Bangsar
                                                                No. 5, Jalan Bangsar Utama 1, Bangsar
                                                                59000 Kuala Lumpur

                                                                Tel  : 03-22888815 / 16 / 17
                                                                Fax  : 03-22888819
                                                                e-mail: lppeh@po.jaring.my

so that necessary action can be taken against Badan Pengurusan Kondominium Mewah Heights.

3.               Hope that the above explanation will help you further to get your problems solved amicably by the parties concerned.

Thank you.


                                                            
"KUASA PENGGUNA: 1PENGGUNA 1SUARA"

Pn.Tan Chwee Gim
Penolong Pegawai Tadbir Kanan
Seksyen Kepenggunaan
Pej. Perdagangan Dlm Negeri, Koperasi dan Kepenggunaan
Wilayah Persekutuan Kuala Lumpur
No. Tel:- 03-40454555 ext 4566
From: Pang Chee Hwa [mailto:amcisa2003@yahoo.com]
To: Tan Chwee Gim [mailto:chwee@kpdnkk.gov.my]
Cc: abusamah@kpdnkk.gov.my, mokhtar@kpdnkk.gov.my, hazrin@kpdnkk.gov.my
Sent: Thu, 28 Apr 2011 14:48:10 +0800
Subject: Re: COMPLAINT AGAINST BADAN PENGURUSAN KONDOPMINIUM PANDAN MEWAH HEIGHTS (Aduan No. 01104214)

Dear Sir,

The bank normally will absorb all of the outstanding fee. It's much easier for consumer to judge the real price. However, Maybank is only absorb 10% and it's not mention about the amount of outstanding fee. I call the auctioneer but they also do not know the outstanding fee.

Only the bank's agent is able to go into the house. However, the pos/cos didn't write down the bank's agent phone no. Hence, I'm unable to take a look for the in house condition.

In addition, I didn't live in the condo, why I have to pay for the previous owner outstanding fee?


Thanks & Best regards,
Pang Chee Hwa

From: Tan Chwee Gim <chwee@kpdnkk.gov.my>;
To: <amcisa2003@yahoo.com>;
Cc: <abusamah@kpdnkk.gov.my>; <mokhtar@kpdnkk.gov.my>; <hazrin@kpdnkk.gov.my>;
Subject: COMPLAINT AGAINST BADAN PENGURUSAN KONDOPMINIUM PANDAN MEWAH HEIGHTS (Aduan No. 01104214)
Sent: Thu, Apr 28, 2011 4:13:53 AM

Encik Pang Chee Hwa,

Terima kasih atas aduan yang telah tuan kemukakan  bertarikh 27/4/2011 melalui sistem e-aduan ke pejabat ini. Setelah diteliti aduan tuan, adalah dimaklumkan bahawa aduan tuan adalah di luar bidangkuasa pejabat ini kerana tiada akta yang sedang berkuatkuasa atau yang termaktub di bawah Kementerian ini yang membolehkan tindakan diambil. 

2.         Walau bagaimanapun, tuan adalah dinasihatkan supaya menghubungi terus dengan pihak Bank yang mengendalikan lelongan tersebut  mengenai rumah yang tuan hendak miliki itu untuk menanyakan kepada bank tersebut, kenapa tuan tidak diberitahu terlebih dahulu mengenai caj-caj yang tersembunyi itu.  Sekiranya jawapan yang diberikan oleh  Bank tersebut tidak memuaskan, tuan boleh menghubungi Bank Negara Malaysia untuk penerangan lanjut melalui No. Hotline: 1-300-88-5465.

3.         Seperti yang  diberitahu oleh Jabatan Perumahan Negara juga, setelah dihubungi oleh pejabat ini untuk mendapatkan maklumat lanjut pada hari yang sama,  bahawasanya memang terdapatnya klausa yang menyatakan bahawa dalam apa-apa sahaja lelongan yang dikendalikan oleh mana-mana Bank sekalipun, seseorang yang telah berjaya dalam lelongan tersebut perlu menjelaskan baki hutang penyelenggaraan, cukai pintu dan sebagainya oleh pemilik utama harta tersebut. Oleh itu, tuan seharusnya membuat semakan terlebih dahulu mengenai latar belakang sesuatu harta yang hendak dimiliki itu sebelum membuat keputusan.

3.            Dengan penerangan seperti di atas, adalah diharapkan supaya tuan dapat menyelesaikan masalah tuan dengan secepat mungkin.

That's why I ask if the management office not under mpaj, can I do anything?

I see. I think your main grouse is still on the outstanding maintenance fees. Unfortunately, it is assumed under the Building and Common Property Act, the unit owner is expected to pay all outstanding. Because of the way you purchase the property, the bank has effectively transfer all liabilities to you, whether you like it or not. You do have a right not to purchase the property but if you do continue to bid and purchase, the liabilities will be transferred to you. I know of another purchaser who is currently fighting in court but I think it is an ongoing case, so I do not know how the judge will rule. But personally I believe it won't be easy. You will suffer ultimately, because if you don't pay, management will not give you water or other assistance, you won't be able to rent out the unit. How much is the outstanding anyways?

BTW, I think the correct person to check with regards to the legality of the management corporation or joint management body would be commissioner of buildings rather than local council as they have to report to COB.

Oh.. Thanks a lot!!

I'm now request the management office to send me the cob contact and email.. Thanks!!

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Added on May 5, 2011, 5:15 pmHi, sifu!

If I spend 1 month to get the loan approval, do I still hv time to finish all the process?

& how can I fasten my other process? Thanks..

This post has been edited by present: May 5 2011, 05:15 PM

Malaysia Bank Lelong Property Auction Process and Guideline

Can somebody answer me.

Who is going to pay for the lawyer fees to transfer the name ? Bank or purchaser ?

Who is going to pay to remove caveat, remove charge etc.

All other fees is paid by purchaser.

Bank only help cover what own by the previous owner, such as maintenance fee, assessment and etc.

If all other fees by right purchaser need to folk out.

However, in some cases the bank do not want to cover what own by the previous owner.

So please double check in the POS to make sure before you bid.

How to get the POS ? Can we get POS without agent ?

I'm an agent. But you want it, i straight away give you.

I saw your other post the agent request 1%.

Anyway tell me the address and i will give it to you. And your email also.

This post has been edited by Alvinyeo: Mar 30 2012, 02:02 PM

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1. property is leasehold

2. the master title is not transferred yet to first owner.

3. the condo is more than 10 years old.

4. auction unit (not from high court and not from land office)

Do we need consent from developer too ? If answer is yes, how long will developer take to give us consent ?

This post has been edited by jalsrix: Apr 5 2012, 05:30 PM

Eh sorry tumpang thread.
I thought auction properties are normally free from encumbrances? Or excluded caveat?
I'm going for an auction soon as well. If lets say the reserved price is rm400k. I need to prepared a bankdraft amounted rm40k in order to register as a bidder.
And when the final hammer at 600k, when do I need to pay the remaining 20k to make it equal to 10%?
And do anyone of u advise to use the same auction bank and get loan from them? Or is better for me to engage my own banker and mortgage it?
If the property is in KL, can i apply loan at Sabah?
Do I need to engage my own lawyer to do the transferring or I can use the bank lawyer?

FYI, the property is freehold and individual title.

I am not an expert but auction property usually have bank caveat and also charge.
And also tenants who refuse to move out.

Free from encumbrance means what ?

What kind of consent you need. I'm mean when you change tittle you how also need the developer's consent.

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Added on April 6, 2012, 7:20 amI'm not sure your 1st question.

But for the reserved price is RM400K and you bought is RM600K. Is depend your auction is in Highcourt or Auction house. If is in Highcourt, i witness mostly no need pay extra but need settle with the bank. For auction house yes you need to pay the remaining 20K, is a must.

Normally the auction bank wouldn't care which bank loan you taking. Most important you can settle their outstanding loan enough ad.

Yes. You can engage your own banker but i not sure west and east Malaysia, but most of my auction case in KL i summit bank in Melaka (My hometown).

You can either use your own lawyer or recommended lawyer by the bank. But just to let you know not all lawyer can do certain loan agreement. The firm need to be in their panel only can.

If you need legal quotation i can send to you for free.

If you need my help in auction just PM me. I will reply you when free.

Good luck anyway.

This post has been edited by Alvinyeo: Apr 6 2012, 07:20 AM

I heard if title broken up into strata but old owner haven't transferred to his name yet, we still need developer consent to transfer
to new owner.

can anyone verify ?

Auction properties depending on if it is high court auction or LACA. For high court auction, it usually clear you of everything including unnecessary caveats but excluding government's caveat, eg. IRB, customs, police, etc. Eventually the government agencies will clear the caveats, once they received their supposed share. But I wouldn't touch government caveats with a 10 foot pole even if it is way below valuation. Individual caveats can be removed but takes time, so might be difficult for your financing bank to draw down on time.

Something which I noticed since late last year was that POS for the whole west malaysia high courts seemed to have been standardised (I have only seen POS for high court in KL, Seremban, Malacca and JB). So if it is so, then you do not need to pay the difference at the auction date but to settle the differences within the stipulated time.

Don't get the same bank to pay off as I had previous experiences where the bank ain't in a hurry to pay off and I had to come up with cash. Very bad of the bank.

You can apply the loan anywhere you want. Not just malaysia, as long as they are happy to lend you.

You need your own lawyer to do the transfer. But seriously, you must make sure you have cash at hand in case your bank cannot draw down on time. Or you will lose your RM40k initial deposits.

Yes correct. Most property in KL i believe haven't issues strata tittle yet.

I personally bought a lot of MK land products trough auction and they always haven't issues the strata tittle yet.

So have to ask my lawyer get consent trough the developer.

This is also being done if is sub-sales.

So you are saying that if a property under master title but approval given to the first owner, we won't be able to get the money on time (90 days) because developer can delay us ?

So it is very risky buying auction property ?

Thanks alvin and michael..
I just went to land office to do an offal search today and it is free from any caveat. Means no caveat. Is a high court auction..

But if I used the same bank that auction the property, and it the delay is from the bank itself, why would I be the victim? Once I submitted my necessary loan doc, and once enter the system, everything is show with date. If it is the bank that delay the disbursement of the full sum, is not my fault right? Like u said, bank always win. But win with negative evidence, is a risk for them, isn't?
Ok then I follow your advice to try other bank.

There Was once my fern encounter a case, in which the purchaser of a under con apply to a bank, and the bank rejected the person loan, due to the reason that she/he is staying in Johor and the bank are questiOning why she/he is buying the property in selangor. Weird right? Dunno if the banker SKL the purchaser or it really happen.

Do u advise if I use their panel lawyer to do the transfer? If we're talking about interest here, I don't think we can outrun the bank's terms, right?
Yeah I'm ready with it, worst come to worst I have to deduct it from my renovation budget Lo..hahahah...

Hi, I understand your concerns but I have explained both in PM and in public on the risks of buying properties from auction. It is best to steer clear of such purchases unless you have seen it done before or have plenty of cash to play with.

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Added on April 7, 2012, 2:05 pmOkay, I am going to say something which will surprise you. If you look closely at the facilities agreements, your so called lawyers are actually acting on behalf of the bank and NOT you even though YOU will be PAYING for the bills. It is weird but true. In the sense that if something were to go wrong, your lawyer cannot actually help you. So you do not need to use their panel lawyers for transfer as it is non of the bank business but the vendor can accuse you of picking the wrong lawyer/banker which caused the deal to be delayed and hence penalise you heavily by way of interests or forfeiture of deposits. It can sometimes be a dog eat dog games and survival of the fittest. If you have enough volume, banks and lawyers would usually try to accomodate you. If you are going to see your lawyer once every 5 years or so, don't expect the best of customer services.

I have one single experiences with MAYBANK. I can say out the name of the bank as it is a true case incident which happened some 6 years ago. I bought a LACA property from MAYBANK auction and thought that it would be best to use the same bank so expedite the matter. Loan approval done and ready. But their auction side was extremely slow from missing papers to whatever. Given that I knew the developer quite well, they were even ready with the direct transfer documents (from master to strata) to my name within a couple of weeks from auction. I made a complain to their head of customer services but at the end decided not to follow it up as it may costs someone their jobs. I rather allow these people continue working so that will give me plenty of excuses not to use Maybank. It was delayed by more than 2 months and I had to settle by cash, even though it was entirely their fault.

This post has been edited by michaellee: Apr 7 2012, 02:05 PM

Yeah i'm expecting if i'm using their panel lawyer and not my own lawyer, the interest will be on their side definitely. So you're saying regardless of which lawyer i use, i still need to pay the same amount of fee? Unlike subsale, where if vendor or purchaser tumpang lawyer, then charges are significantly reduce?
Anyway, i will follow your sincere advise! But just questioning back for confusion. Hope you don't mind..

Oh yeah, 1 more thing. The auction that i'm going is under CIMB, and if i'm going to get my own lawyer, do i have to choose the lawyer that are the panel of CIMB?
And panel must be that particular branch, or as long as CIMB?

So initially, the step would be as below:

Before auction
1. Inspect the property at your own will.
2. Do an official search for the properties
3. Register with the licensed auctioneer/ agent/ bank.

During auction
1. 10% of the reserved price by bank draft, with photocopied IC.
2. Go for bidding

After auction
1. Pay the remaining of the 10% from the reserved price - final price by either bank draft or cash.
2. Apply for bank loan. (this can be done before the auction for safety precaution that as if you think your financial statement would be a problem)
3. Engage own lawyer.
4. Wait lawyer to prepare documents
5. Loan approved, sign LO and LA.
6. Sign SPA, and whatever doc that related.
7. And, wait lawyer to process again.

Anything missing or wrong, please fill in for me ya..
Million thanks

Great step by step process. My question

Before auction
2. What's the purpose of the title search ?
3. How many days before auction day do we need to register ? (agent say several days but auctioneer say just go on auction day)

After auction
7. Wait for approval from land office (if leasehold)
8. Wait for approval from developer (if master title)

Can you advise on how to do the official search on property? What is the objective of this task?

Sorry to interrupt but how much is the legal fee for the sales contract for auction property? Is there any? If yes do they calculate using same rate as snp?

Facilities agreement is not the same as SPA. So only one lawyer will be used which will be the lawyer, whom you have hired but must be under the bank's panel and that particular lawyer, you will need to pay them (with discounts if they are happy to give you some) but they will end up as banker's lawyers. Confusing? Yeah, a lot of seasoned players didn't know that even. Most lawyers will not sue banks as they are worried that the bank will not give them businesses later on. But you can always complain about lawyers to the bar.

The auction you are going for is by CIMB. That does not mean you need to use CIMB panel lawyers but rather the panel lawyers of the bank you are hoping to obtain loan from.

As for before auction, it is optional to register with licensed auctioneer/agent/bank. Unless you are getting some kickbacks (not so proper) best is you do not register, as some auctioneers may not be ethical enough and "inform" friends to kacau the auction.

After auction, depending on how the POS is worded, you may or not have to top up the balance of 10%. So far since late last year, I have seen all POS for high court do not require the top up. Kindly advise if any of you have seen otherwise. You do not sign SPA for auction properties but MOC (Memorandum of contract). The lawyer will need to help you prepare the transfer documents. At the same time, you need to look for a bank to do up your loan. Best to use the same lawyer for transfer and loan to prevent delays in communications. For auctions you do need to hassle your lawyers to remind them of the 90 or 120 days. Most lawyers couldn't give jack shit and I have seen a lot of bidders who are not able to complete on time and hence the need to pay cash for the balance. A good lawyer with good follow up will ensure that the delay is minimal. Remember time is of essense in completing such documentations.

Thanks bro for addin up.
The purpose of title search is to check whether the property is under caveat or not, and to reconfirm the vendor's name and details. If the information u got from agent/auctioneer or any third party doesn't match the information given on the search, there is something wrong. So better be safe than sorry.
Actually u can just go on the auction without register as long as u bring the 10% bank draft based on the reserved price. Sometimes agent/auctioneer ask u to register is because they provide services suc as follow up and remind you about the auction or updates if there is any changes. But the main reason behind is that, you register with agent 'A', and when you are the successful bidder, agent 'A' will get commission from the bank. But of course some agent will provide support and guide u on anything regarding the auction, and some will not bother about u, and just claim commission if you had register wit him and u won it. They need your particular to submit it to the bank claimed that you're their client before the auction.

To ensure the title is clean for transfer. As per above, it is NOT necessary to register. Any agents telling you so is trying to secure their commission from banks. And the auctioneer is right. Just go on the day with the appropriate documents will do. Like I said, unless you are getting some kickbacks, there is really no point in registration.

There are two types of auctions, high courts and LACA. For high court, no approval is necessary even for bumi lots. It is transfer straight away without restrictions.

If LACA, then yes, you need plenty of approvals, etc.

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Added on April 7, 2012, 11:27 pmShould be the same. Though for high court auctions, lawyers are more willing to give more discount as less work is needed to complete the transfer.

This post has been edited by michaellee: Apr 7 2012, 11:27 PM

Could you advise on how to do the official title search? Where to do, how much we need to pay, etc???

Assuming I obtain and got approved by bank 'ABC', so I will need to find a lawyer which is the panel of 'ABC' and ask that particular lawyer to handle both transfer and loan agreement, right?
Ok understood! Ya true also, they wil rather lose 1 client like us than the entire bank community! Business opportunity, can't fully blame them also .

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Added on April 7, 2012, 11:37 pmYou need at least the Proclaimation of Sale before u do the search to get full information about that particular property such as lot number, mukim/daerah etc.
Land search can be done publicly in land office followed by state. If under selangor, you need to go shah alam land office, if in KL, then u need to go KL land office. Rm50 per official search. For shah Alan land office, it close at 3.30pm so best to go before that.

This post has been edited by clanzkiller: Apr 7 2012, 11:37 PM