The gain is calculated from price at time of disposal less price at time of acquisition.

The price at time of acquisition by initial owner (deceased) is not relevant.

Let's say now you dispose it at RM100K now. Perhaps it was transferred to her name as beneficiary 2 years ago on 13/12/2009. LHDN will assess the market price of the property at that date - 13/12/2009 (or thereabouts).

Let's assume that it was RM80K at 13/12/2009, so the gain is:

RM100K - RM80K = RM20K.

It is not nett gain at 5% of RM20K.

Acquisition price also includes cost of renovations, legal fees, agent fees, etc. Add that to acquisition price - perhaps RM5K

Final acq price = RM85K.

Disposal price also includes legal fees, agent fees, etc. So you deduct that from disposal price - perhaps RM8K.

Final disposal price = RM92K.

Nett gain = RM92K - RM85K = RM7K.

Taxable gain - 5% of RM7K = RM350.00

However, you would need to pay 2% of the purchase price upfront first. LHDN will refund the rebate to you later once they've processed your file.

* All receipts evidencing renovations, legal fees, agent fees - must be submitted.

* In the Form CKHT 1A (for vendor) - at the part where price of acquisition is required to be filled up - LEAVE IT BLANK. LHDN will fill it up with their assessed market price and they'll do the final math.

Hi dariofoo, got several questions here:

1.
what's the major diff between an individual and master title?
why have a master title and not go straight for individual title?
what are the concerns for buyers of houses under master title?

2.
are there any major difference between final and qualified title apart from the fact that qualified title does not allow partitions?

3.
why for individual title require open/closed charge while without require DOA and PA?

4.
mind sharing the difference between the four types of caveats. I'm very blur on it.

Thanks

now the lawyer said register lee fong moi as executor of the 1/2 share is the first part. now the second part is to register lee fong moi as the ONLY registered owner of the property therefore can transfer to purchaser and charge to bank. so can register her as the only owner or cannot one ah? confuse....land office never pick up phone one so cannot ask.....

now lee fong moi is registered owner of 1/2share and executor of another 1/2 share of then property, then can she transfer the other 1/2 share to her name so she can be the one and only registered owner?

does the law require she to be the one and only registered onwer in order to complete the SPA? or, the SPA can be completed even she is the registered owner of 1/2 share and executor of another 1/2 share?

is there any guidelines? have you came across such situation? usually what should the vendor do?

does she need to pay RPGT? the property bought in 1995 under lee fong moi and the deceased.

This post has been edited by Felixchui80: Dec 13 2011, 09:47 PM

Thanks dariofoo

I have few more questions as below,

i) Lets say i'm a purchaser and i have interest in a property. However the house is joint owned by a couple (wife n husband)
Yesterday when i signed the Letter of Offer and Acceptance (LOA), only the wife name is stated inside the LOA.
Is it ok or both names must be stated inside the LOA ?

ii) One of the verbal agreed terms is that the current owner wud leave 70% of the furnitures/renovations and electrical applicances.
Lets say during the SnP signing, it is stated inside the SnP, however the owner refuse to sign and argue that at that moment, he don not want to
handover the furniture. Is there anything that we can do ? I just sign the LOA.

iii) During the LOA signing, i have requested the agent to introduce a lawyer. The current owner is also interested in using the same lawyer as well
which means that we are using a common solicitor. In this case, the common solicitor is representing whose interest more ? The owner or me ?

Many thanks . More questions wud be coming as i just sign my LOA for my 1st house.

LAWYER'S CORNER WILL BE TAKING A BREAK

Sorry guys am off for an outstation trip now.

Shall be back tmr evening and shall endeavour to answer all outstanding queries by tmr night or friday.

Cheers.

This post has been edited by dariofoo: Dec 14 2011, 12:05 PM

Hi, I want to ask whats the different if use bank lawyer and my own lawyer? Which 1 better?

Hi Dario:
regarding the 20% remission in stamp duty for loan document for islamic financing, I found out it does not apply to all islamic loans. I applied for Cimb full flexi islamic loan and my lawyer charge me full rates for the loan document stamp fees. when I queried the lawyer told me that IRD disllowed the 20% remission because my loan is of flexi type, even though it is islamic financing. Is that true? Anyone else has the same experience?

Secondly regarding the early redemption of islamic loan, what is ur experience like? do they operate like conventional loan whereby people just redeem the outstanding loan?

Hi,

Hopefully you guys can help me. My situation is I've signed a SPA to buy a subsale property. I've already signed the Letter of Offer from my Bank and now just waiting for the proper documentation to released the funds.

The owner just informed me that she has received the keys, VP letter and CCC from the developer (Sime Darby). I instructed my lawyer to start the process of releasing the funds, changing title etc.

Will the bank released the funds with just a CCC letter or do i need to wait for the CFO from the local council?

If bank can released the fund with just the CCC, is it advisable to take possession of the house without the CFO?

A new buyer here .. apologize for the ignorance.

Regards

Thanks Dario, your help is appreciated

Pls help me to review the attached lawyer quote
Property details,

Freehold
Individual title
Joint ownership at seller side (husband and wife)
Seller using different lawyer
Joint ownership at buyer side (me and girlfriend)
Buyer using different lawyer
Selling price: RM567k
Loan Amount: RM510k

S&P and loan lawyer is the same lawyer.

From the v1 thread and v2 thread, below is the info that i have gather.Correct me if i'm wrong

S&P
Misc fees of RM250
Can i nego for discount ?

Registration on MOT RM 500
Statuatory declaration RM 20
What is this and is this necessary ?

Loan Agreement
Stamp Duty on loan agreement RM 2,555 ?
My loan is RM 510,300. 0.5% from loan amount is RM 2,551.

Preparation of charge document RM 402.21
Registration Fee on Charge Document RM120.00
Registration Fee on Entry of Private Caveat RM340.00
Registration Fee on Withdrawal of Private Caveat RM80.00
Statutory Declaration for Owner Occupancy RM 20.00
Stamp Duty for Statutory Declaration for Owner Occupancy RM 20.00
Stamp Duty for Letter of Offer RM20.00
Purchase of Document RM100.00
What is this and is this necessary ?

Land Search RM 60
This is have been charged at S&P. Can i nego for waiver ?

Bankruptcy Search (RM12-00 per person)
I have to pay for seller bankruptcy search ?

Courier charges and Misc- Transport, phone calls, postage, fax, photocopies etc. RM 250
This is considered expensive since i'm using the same lawyer for S&P and loan agreement.

Any inputs and comments are most welcome

This post has been edited by Milo_O: Dec 15 2011, 04:34 PM


Attached File(s)
 Bill_Loan____Title__1_.pdf ( 10.32k ) Number of downloads: 98
 Bill_P____Title__1_.pdf ( 32k ) Number of downloads: 78

dario

Is it better to sign S&P next year or this year for the buyer ? Since it is december already.

Will the lawyer tax be 5% or 6% next year ?

Will we still need to pay for ckht 2a next year ?

I am trying to save money ....

1. Master title is basically a huge title owned by the developer (or landowner who JVs with the dev) which has yet to be submitted for subdivision into indiv/strata title after the completion of the housing development. Sometimes it is also known as block title.

Indiv title is basically the one particular title which identifies the individual unit in a housing development. For high-rise, it is known as strata title, but basically it is an individual title.

Why Master Title and not straight? Well, for strata title, the dev can only apply for it once the high-rise has been completed. If normal indiv title (eg for a terrace-house project), some developers apply for subdivision early and offer indiv title as part of the package. Some don't, and wait til they reap the profits from the sale. Perhaps because it is expensive to subdivide, or perhaps they haven't settled their loan with their end-financier, hence the master title is still encumbered.

2. No major differences. No partitions or subdivision. The boundaries are also not final (like duh!).

3. Because if it is Master Title, the unit owner is not the registered proprietor of the master title. Hence, the bank can only create the DOA as security for the loan granted to the unit owner. The DOA basically denotes assignment of beneficial ownership of the unit to the bank. The sequence of the DOA goes on and on for every subsale, and the owner must keep the trail of DOAs all the way to show that beneficial ownership has been assigned to him properly.

If individual title, the unit owner is the registered proprietor. Hence, the unit owner can agree to charge the property in favour of the bank as security for the loan. The owner is the chargor and the bank is the chargee.

4. Four types of caveats:

a) Private Caveat (PC)

The most common type of caveat. Any tom,d*** and harry with a caveatable interest can lodge a PC upon a property. Once a PC is lodged, it restricts any dealings upon the property. Most common intent is to prevent transfer to another party. You have caveatable interest like when you put in 10% down payment when executing a SPA. A PC can last for max 6 years.

A PC can be easily removed by the registered proprietor. An application to remove is made, notice is given to the person who entered the caveat, and within 2 months, if no just cause is given why the caveat ought to remain, it is automatically removed. The registered prop can also sue that person for compensation.


b) Registrar's Caveat (RC)

This is a caveat which the registrar or land administrator can lodge upon the property. Effect is the same as PC, but it is more 'powerful' because it also restrains dealings which have been presented for registration but not yet registered. So, it can be back-dated to even stop dealings which have been presented. A PC cannot restrain a dealing which has been presented.

More often than not, RCs are applied for by the govt to restrain debtors who owe the govt from transferring their property and defeating the govt's claim against them.

I've also heard of landowners who are victims of fraud apply to lodge a RC to protect their interests while they pursue legal action against the fraudulent party. In that case, the transfer was presented for registration but not yet registered. If by way of PC, it cannot be prevented from being registered. However, the RC can do so. Thus, the alleged fraudulent transfer could not go through and would still be pending.

The 6 years limit does not apply to RCs. It lasts as long as the Registrar does not remove it - or until an application by the registered proprietor, or a Court order is issued to compel its removal.

c) Lien-holder's caveat.

In the old days, when banks didn't want to go through creating a charge over the property and when there were no lenghty facility/loan documentation, a person can deposit his original title (called an IDT) with the bank, who will in turn grant him a loan. The bank can then apply to lodge a lien-holder's caveat over the property to secure its interest. If the borrower defaults, the lien-holder can go for an order for sale. This type of caveat is, however, very hardly used these days.

d) Trust caveat.

Basically to protect the rights of trustees and beneficiaries of property given to them pursuant to a trust. Once again, it is hardly used due to one condition - it can only be removed with the consent of both trustees AND beneficiaries. That may be cumbersome, as it is not easy to gather everyone around just for that. As such, most beneficiaries would just lodge a private caveat over the property in the interim. It serves the same purpose, and they can just withdraw it on their own accord when they wish to, without the need to refer to the trustee.

Hope the above explanation helps.

Your lawyer is right. It must be transferred to her name as beneficiary, and only then can it be subsequently transferred to the buyer. Don't worry about stamp duty as it is RM10 only.

With regard to RPGT, yes she would still have to fill up the forms and submit it, but surely there would be no RPGT as the market price as at date of acquisition would be almost the same as at date of disposal - since it is a back-to-back MOT. But for formality sake, the forms have to be completed and submitted.

1. One name is ok. Surely the wife is signing on her husband's behalf and has his authority to do so. If two friends are owners, then perhaps it would be prudent to have both to sign.

2. Verbal promises is worth nothing as in the event of a dispute, it is your word against his word. So how do you prove your case? If you want to be prudent, get the owner to list out the items and get it annexed to the SPA.

3. The lawyer is supposed to act on your behalf. He is your lawyer. Common solicitor only refers to his role as assisting the vendor to redeem the loan, prepare discharge docs, and filing CKHT forms. At all times, he must act in your best interest.

Surely you trust the capabilities of your own lawyer better than another lawyer right? Given the choice whether to retain your SPA lawyer to also do the loan doc, or take bank panel lawyer, it would be better to stick to the same lawyer as it usually makes it faster - it eliminates a trail of correspondence. However, i used the word "usually" as there could be a delay if the lawyer is not adequately experienced in handling the loan docs. So it could backfire.

Choice of lawyer is very personal. Depends on the individual. If you're confident that your lawyer can do the job, then by all means go ahead.

Never heard of that. Let me check and get back to you.



Calculation of the sum in cases of early settlement would be a question best answered by an experienced banker.

If I'm not mistaken, the CCC replaces the need for a CFO. With the CCC, the owner can move into the unit already. I think this came into place sometime in 2007 to eliminate the need for CFO, which was a cumbersome process, full of red tape. However, if i'm not mistaken, it only applies to new properties which are not larger than 2 stories.

If your property fits the description, then the bank ought to be satisfied with proof of a copy of the CCC in order to release the balance loan sum.

Milo_O:


Disbursements you can always nego for discount. No prohibition there.

For stamp duty upon loan, it is always rounded up to next thousand - so your loan is deemed to be RM511K - so the sum is correct.

Purchase of documents from bank - the bank charges for copies of the loan doc. Price ranges from RM100-RM150.

Land search - RM30/search.

Bankruptcy search - if same lawyer for SPA and loan, it needs to be done once only. The onus is upon you to search whether the seller is bankrupt, not the seller, so you have to pay for it.

Total disbursements for both SPA and loan is RM500. If you've read the earlier posts you'll have a rough idea as to whether it is too much and what you may do.

There's no difference, from the way I see it. It's not like a car where some people are hesitant to buy at the end of the year as it will be referred to by the year of purchase/registration, and not the month.

Any superstitious beliefs?

There has been no announcement as to change of service tax to date, so I guess it would still be 6%.

For CKHT forms - please note that filing of forms is free - you're paying legal fees for the lawyer to prepare and file it. Please refer to SRO 2005 which you can download at the first page. The legal fees has not changed since then so I doubt if the coming year will make any difference.

Thanks Dario. I have further clarifications.
Apologize if u may have answer this but i cant seem to digest the answer.

SPA

Registration on MOT RM 500
Statuatory declaration RM 20
What is this and is this necessary ?

Loan Agreement
Preparation of charge document RM 402.21
Registration Fee on Charge Document RM120.00
Registration Fee on Entry of Private Caveat RM340.00
Registration Fee on Withdrawal of Private Caveat RM80.00
Statutory Declaration for Owner Occupancy RM 20.00
Stamp Duty for Statutory Declaration for Owner Occupancy RM 20.00
Stamp Duty for Letter of Offer RM20.00
Purchase of Document RM100.00
What is this and is this necessary ?