Your lawyer is absolutely right. Any delay by the vendor will result in the completion date to be extended in favour of you as the purchaser. The common understanding in SPAs is that:

Vendors want their money fast and conclude the deal AND Purchaser has the duty to make payment of the balance purchase price on/before the completion date. As such, any delay by purchaser and he has to pay late penalty interest to the vendor. Any delay by the vendor, and the purchaser gets more time. Vendor is at a loss as the market price of the property may go up. Factor in inflation as well and the depreciation of money - both factors whereof are detrimental to the vendor.

If upon completion of the SPA, the vendor fails to deliver vacant possession to you - then he has to pay late penalty interest to you. That is how it works.

So now, either you back out of the transaction or you be patient and agree to the clause to wait until April for redemption of the vendor's loan.

Usually, upon redemption, it takes 3-4 weeks to complete the SPA, so you're just looking at another few more weeks of delay.

If you execute the SPA in 2 weeks' time (bearing in mind the holidays and a few exchanges of drafts) - you're looking at the date of the SPA to be around the first week of March. End of April would be around 7-8 weeks from the time the SPA runs. If all goes well with redemption, you're looking at another 3-4 weeks to complete it. The standard completion date for SPA is 3 months. So, you'd still be within time. If there is a bit of delay, it'll be for another few weeks only.

Weigh the pros and cons first before deciding. How much do you want this property? Is the deal and price good that you won't be able to find another?
If you think you can't wait for it, then back out now. Good luck.

thanks dario - your advice is always helpful

ok i actually want to back out of the deal now but the vendor is not agreeable ie he wants to continue and willing to remove that clause from our S&P

However as what you say above, he can just drag the redemption. My worry is that i have no visibility of the actual date. His lawyer say end of April but it can be end of May or even June

Furthermore he failed to mentioned this in the beginning

The 2% paid to the property agent and he has instructed the agent not to refund me.

Does he has the right to forfeit my deposit in this case?

What else can i do?

This is really unfair to the buyer

Hi Dario, thanks so much for the valuable info

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Added on January 19, 2012, 1:28 amI thought EPF interest is calculated monthly. So even if the dividend is announced later, the amount withdrawn will only affect the latest month's interest/dividend calculation. Actually I'm also in the same situation. I've withdrawn the EPF early this month but I believe I will still receive interest/dividend for the whole of last year for the amount I've withdrawn since my withdrawal is only in Jan-2012. Please correct my understanding if I'm wrong.



This post has been edited by 1282009: Jan 19 2012, 01:28 AM

Hi Dario,

Thank you very much for answering and explanation.

I learn a lot from this thread....please keep up the good works.

Thank you.

Whether he has the right or otherwise will be stated in the letter of offer to purchase. So do take a look at it and see what it stipulates.

Another way is to proceed to draft the SPA and send out a draft to the vendor (or the vendor's lawyer). If parties fail to agree on a finalised SPA, then the transaction is deemed to be aborted. Look at the letter of offer again to see what it states in a situation of abortion of the transaction. If he has to refund you, then demand for it. If it is forfeited, then you can't do anything as you had agreed to such term and had executed the letter of offer containing same.

10% is payable on the date of execution of the SPA. You hand it over to your lawyer on that day. Your lawyer would then send over the SPAs and other docs to the vendor to be executed by the vendor, together with the cheque for 10%

Good luck with your matter. Come back for further enquiries.

Even if he's shown the SPA, that doesnt mean he's the current owner. Maybe that SPA is before he sold the property to someone else.
I need third party source of information. Where can I get owner info of any property?

I'm not sure if this is related to this thread. How long does the bank normally take to reduce the loan principal amount from the cheque sent by EPF?

dariofoo,
I think u may have misunderstand my question

Property Selling Price = $ xxx (100%)
Deposit = 10% payable by myself using own cash
Loan from bank = 80%

Remaining 10% going to be paid using EPF withdrawal. Is this 10% to be paid out on the date of SPA execution ?

This post has been edited by Milo_O: Jan 19 2012, 01:11 PM

If there's individual/strata title - you can conduct a title search, but you'll still need the particulars of the title.

If no title, then you can check with the developer or management office.

Best if you directly check with the bank in question.

Oh ok. Sorry.

For your info, this amount is called the differential sum.

Differential sum has to be deposited with your lawyer as stakeholder before the bank drawdowns the first release to redeem the vendor's loan. The bank would require confirmation that the differential sum has been deposited, before they will release. Until and unless you do so, the whole process would be on hold.

Thanks dariofoo
I have another question here. What is the meaning of Letter of Undertaking ?
Who issue it and who shall receive it ? What is the reason of issuing and what function does it do ?

Thanks

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Added on January 19, 2012, 2:07 pmLet me make few phone calls to EPF hotline and get some clarification.
Few times wud ensure the authenticity of the information as u know, goverment office always provide different answer from person to person.

This post has been edited by Milo_O: Jan 19 2012, 02:07 PM

Letter of undertaking (LOU) commonly refers to the undertaking (promise) given by a party to the purchaser's financier to refund the monies paid out by the financier to that party, as the case may be, in the event that either:

a) the deed of assignment cannot be perfected for any reason whatsoever; or
b) the charge in favour of the purchaser's financier cannot be registered for any reason whatsoever; or
c) the deed of receipt n reassignment cannot be perfected for any reason whatsoever.

Party - depends on to whom the money is paid out to:
- Vendor in case of subsale
- Developer/proprietor in case of purchase from developer
- End/bridging financier also in cases of purchase from developer where monies are still owed to the bridging financier by the developer
- Vendor's financier where a redemption sum is paid out.

Why LOU has to be issued by the above parties?

Because there is no contract in writing between the parties. The contract is between the borrower/purchaser with the purchaser's financier. Both parties are privy to the contract, and the external parties are not privy to it as they are not signatories. Under the law of contract, only parties who are privy to a contract are bound by its terms.

As such, the LOU binds the party giving it to refund the monies in the occurrence of an event which basically frustrates the contract between the borrower/purchaser and the purchaser's financier - thus terminating it.

Example - deed of assignment (DOA) cannot be perfected. This refers to deed of assignment between vendor and purchaser. If vendor cannot assign his beneficial right over the property, then the subsequent DOA between the purchaser and the purchaser's financier would also collapse and be of no effect. As such, the vendor must refund all monies paid by the purchaser's financier back to them. The LOU is basically a contract between the vendor and the purchaser's financier. Think of it as a bridge between the vendor and the purchaser's financier.

Without the LOU, there is nothing to protect the bank's interest if such event as stated above occurs, as there would be no binding contract between the party and the bank.

That is why even before first release of drawdown, the original LOU must be forwarded to the bank for their safekeeping.



This post has been edited by dariofoo: Jan 19 2012, 10:56 PM

Thank u !

In that case, please update me as well. Thanks.

I have a property that I have just sold off ... but tenant still owes me rental. New owner's lawyer wanted me to pass over the tenancy agreement (knowing that the tenant still owes me money). My lawyer is saying that I have to give the agreement to complete that transaction. Is this true? Can I get the tenancy agreement back; when I want to take legal action again the tenant. Please advise.

Thanks.

This is the answer to a question related to EPF withdrawal before dividend announcement.

Question:
Scenario 1:
If i make my EPF withdrawal after 31 Dec and before EPF dividend announcement (usually on March), it would not affect the dividend payment.
Dividend payment would take the last number as of Dec for dividend calculation

Scenario 2:
If i make my EPF withdrawal before 31 Dec e.g Oct and before the EPF dividend announcement, dividend payment would take the last number as of Oct for divident calculation

This is a one time calling to EPF center.
I will call another one more time to get confirmation and validate the above info.
I hope my explaination can be understand by u.
My humble apologies if my explaination is not clear. Let me know and i will try to simplify it

hi,

hopefully i am in the right thread... coz i dunno where to ask this question.
can't managed to google it as well..

anyway, may i know why a 2 1/2 storey shoplot can have 2 master title?
it is a lease hold..

thank you