Malaysia Real Estate

[ivantan79]

My dear adviser,

I have signed the S&P, and have applied loan from Affin Bank. Just recent, I received a letter as the loan is rejected. I want to claim my deposit back from the agent but the agent told me the S&P is being stamped I need to pay on the legal fee and stamping fee.

Upon signing the sales application, the agent clearly told me if the loan is rejected I could claim back my deposit and will only charge a RM500 processing fee and there wouldn't be any legal fee or stamping fee will incured if I make the sign up on that day.

My question is what I could do to claim back the deposit?

Is it right for the agent to do the stamping without obtain the approved loan?

Thanks,
Ivan

[subseconds]

Hello Ivan,

As far as I know, once the S&P is stamped, your deposit (plus stamping and legal fees) will be forfeited. Depending on the agreements, you may want to pay the penalty to the seller at the agreed interest rate.

It is always recommended that one should get a pre-approval loan before proceed with S&P. This is to protect you in case loan not being approved.

Unless it is specified as an additional term in Offer to Purchase that says purchase is subject to loan approval, otherwise, it will be difficult to claim back the 10% deposit.

I'm not an expert in this field, but any forumers may take following as a guideline as far as subsale is concerned .. just for your reference:

1) Identify the property you wish to buy and price.
2) Get bank to give you pre-approval for that price (e.g. 90%)
3) Include a term "subject to XX% loan approval" in the Offer To Purchase agreement.
4) Place 3% ernest deposit. Get relevant documents from seller such as master S&P, title etc. Insist on this so that you have sufficient documents to get the loan + executing the S&P within XX days as agreed in the Offer to Purchase agreement.
5) Submit your application to bank for the actual loan application. One thing is try several banks.
6) Once loan is approved, then only you proceed with the S&P, balance deposit. Your lawyer will do the rest ... he/she should protect your interest throughout the sales and purchase, subject to his professionalism.

Just my two cents.

[z78]

I need legal advice from anyone.

SITUATION:
I bought a property through an agent and had paid the earnest money of 3% with a cheque issued, payable to the agent (company). Unfortunately, the sale and purchase agreement was voided. This is becoz the seller's stubborn/reluctant to cooperate/execute the agreement although given 2nd chance. Letters of demands were subsequently issued to the seller for failing to execute the agreement. Finally, due to this circumstances, the deal is off.

Since the deal is off, I would like to claim back the 3% earnest money from the agent. It seems that the agent is reluctant to refund the payment and insisted me to carry on with this unreasonable seller.

I found out later on that the agent had banked in the amount although the S&P is not yet signed by the seller.


QUESTIONS:
1) Does the agent has the right to retain the fund since the deal is off? What property act to define this?

2) There is an act which If I am not mistaken clearly stated that the property agents are not allowed to secure the commission as long as the S&P is not completed. Which act was that? Can anyone quote?

3) What should i do?

[subseconds]

Hi z78,

I'm sorry to hear that. I understand it is really frustrated to have these kind of owner/agent.

In your agreement to purchase, there should be a term saying in the event the Vendor fails to execute the S&P within the said period, the purchaser is entitled to ask for specific performance. If the purchaser does not institute an action for specific performance, then the purchase may have the earnest deposit refunded. The vendor will have to pay you additional sum equivalent to the earnest deposit paid to him as compensation.

As far as I know, the agent suppose to be just a stackholder of the earnest deposit. They have to refund you if the deal cannot be materialized.

My suggestion is ask your lawyer for advise. I'm sure they will be able to offer you help.

I wish you will be able to settle and get your dream home soon.

[z78]

Thanks Subsecond (sobbing...),

The terms are clearly stated in the letter of offer. U were right. In fact, I should be refunded. My lawyer is now fighting to get back the money.

Initially, I wanted to sue the seller out of frustration for failing to execute the agreement. However, after careful consideration, i've decided not to initiate the lawsuit since it would cost me few thousands more and nobody is winning in the end. I rather lose few hundreds to move on with another purchase and take this as a lesson for the next purchase.

Unfortunatey, the unreasonable seller decided to take legal action against me instead for aborting the purchase agreement, which i find it ridiculous after I have issued him several letters of demands for failing to execute the agreement.

It has been a month now. Not only i couldnt get the compensation from the seller, I couldnt get my 10% deposit back up to this date. My lawyer kept telling me that the legal issue is still in progress.

Due to this seller's action, i had to get a defend lawyer to fight on with this silly case which happened to be my lawyer's associate.

QUESTIONS:
How long am I going to be stuck in this silly situation?
Who is winning this litigation case?

Sad and frustrated now

[z78]

Thanks Subsecond (sobbing...),

The terms are clearly stated in the letter of offer. U were right. In fact, I should be refunded. My lawyer is now fighting to get back the money.

Initially, I wanted to sue the seller out of frustration for failing to execute the agreement. However, after careful consideration, i've decided not to initiate the lawsuit since it would cost me few thousands more and nobody is winning in the end. I rather lose few hundreds to move on with another purchase and take this as a lesson for the next purchase.

Unfortunatey, the unreasonable seller decided to take legal action against me instead for aborting the purchase agreement, which i find it ridiculous after I have issued him several letters of demands for failing to execute the agreement.

It has been a month now. Not only i couldnt get the compensation from the seller, I couldnt get my 10% deposit back up to this date. My lawyer kept telling me that the legal issue is still in progress.

Due to this seller's action, i had to get a defend lawyer to fight on with this silly case which happened to be my lawyer's associate.

QUESTIONS:
How long am I going to be stuck in this silly situation?
Who is winning this litigation case?

Sad and frustrated now

[z78]

I don't understand why the 10% deposit is stuck in this litigation case as this is an exclusive case. It is entirely different issue (independent legal matter).

From the way I see it, whether the purchaser or the seller is losing or winning in the end, STILL the 10% deposit should be refunded to the purchaser.

Can anyone advise?