HOME  -    PROPERTY ADS   -   DISCUSSION FORUM   -   REALTORS   -   LINKS    -   CONTACT US



Realtors and Real Estate Agents - Sign Up for Free Account at Property.net.my >>


Malaysia Real Estate
Malaysia Real Estate Portal
 
 FAQFAQ   SearchSearch   UsergroupsUsergroups   RegisterRegister 
 ProfileProfile   Log in to check your private messagesLog in to check your private messages   Log inLog in 

Financing matter...please help

 
Post new topic   Reply to topic    Malaysia Real Estate Forum Index -> Property Financing
View previous topic :: View next topic  
Author Message
mikewong



Joined: 02 Jun 2005
Posts: 7

PostPosted: Thu Jun 02, 2005 7:44 pm    Post subject: Financing matter...please help Reply with quote

hI all,

Present moment, there's a piece of property I intend to invest in, it's got a market value of about 150k (valuer's amount). The owner wants to get out fast and therefore I managed to get a discount, willing to offload the property for 100k in 3 months.

My question is...
1. DO banks allow the financing of the property be BASED ON the valuer's amount and not the S&P AMount?

If not, are there other alternative procedures to get financing on the valuer's price (meaning the higher price between s&P and valuer price)?

Please give me your honoured opinions and options in this matter. THanks

Mike
Back to top
View user's profile
nick1994



Joined: 24 Apr 2005
Posts: 6116

PostPosted: Thu Jun 02, 2005 7:51 pm    Post subject: Reply with quote

its very hard......most banks give lower of S&P or value......

try shopping the banks.....some may b desperate enuf....

and if all else fails ......theres a roundabout way.......but u'll need your own funds and u need a certain time lapse.....
Back to top
View user's profile
Banzai



Joined: 25 Oct 2004
Posts: 3367

PostPosted: Thu Jun 02, 2005 10:21 pm    Post subject: Reply with quote

get the lawyers to create a supplementary agreement to refund the excess? Razz
Back to top
View user's profile
aimtrue



Joined: 18 May 2005
Posts: 139

PostPosted: Fri Jun 03, 2005 12:32 am    Post subject: Reply with quote

Banzai: He he he. Yes, along the same lines, the seller can pay an agent's commission (3%) to a friend/relative of yours, or he can pay in advance to your contractor for renovations (who knows, RM20K-30K is reasonable). It's a loop hole of sorts.

(One which has been used by our esteemed Datuks and Tan Sris since before I was probably born.)
Back to top
View user's profile
aramis



Joined: 02 Jun 2005
Posts: 156
Location: Cyberjaya / Old Klang Road

PostPosted: Fri Jun 03, 2005 1:50 am    Post subject: Re: Financing matter...please help Reply with quote

mikewong wrote:
hI all,

Present moment, there's a piece of property I intend to invest in, it's got a market value of about 150k (valuer's amount). The owner wants to get out fast and therefore I managed to get a discount, willing to offload the property for 100k in 3 months.

My question is...
1. DO banks allow the financing of the property be BASED ON the valuer's amount and not the S&P AMount?

If not, are there other alternative procedures to get financing on the valuer's price (meaning the higher price between s&P and valuer price)?

Please give me your honoured opinions and options in this matter. THanks

Mike


Ask the seller if he is willing to jack up the S&P price? Then talk to your preferred bank and tell them you wanna get full loan. Tell this to your lawyer as well and they will know what to do.

I used the same method and got both my properties via zero down.

Smile

"Ask and ye shall get" ....thats what I do
Back to top
View user's profile
mikewong



Joined: 02 Jun 2005
Posts: 7

PostPosted: Sat Jun 04, 2005 2:56 am    Post subject: Reply with quote

Ask the seller if he is willing to jack up the S&P price? Then talk to your preferred bank and tell them you wanna get full loan. Tell this to your lawyer as well and they will know what to do.

I used the same method and got both my properties via zero down.


Hi Aramis,

Thanks for your reply.
Just a question...if I'm getting a discount from the seller and asking him to jack up the s&p price...wouldn't he say...might as well you pay me full then...
or even if he says ok...and then give him 100k and he refuse to transfer title as s&p says 150k...
can an agreement be made to do have a formal s&p to get financing and another one just for the actual price.
when you both your properties for zero down...what was your strategy? to cash-out the excess from bank financing and reinvest or just to get a positive cash flow from rentals?

thanks
Mike
Back to top
View user's profile
mikewong



Joined: 02 Jun 2005
Posts: 7

PostPosted: Sat Jun 04, 2005 3:02 am    Post subject: Reply with quote

aimtrue wrote:
Banzai: He he he. Yes, along the same lines, the seller can pay an agent's commission (3%) to a friend/relative of yours, or he can pay in advance to your contractor for renovations (who knows, RM20K-30K is reasonable). It's a loop hole of sorts.

(One which has been used by our esteemed Datuks and Tan Sris since before I was probably born.)


Hi aimtrue and Banzai
thanks for the reply.

so basically banks would only finance the lower of s&p and valuation. ok...
banzai, you mentioned something about a supplemental agreement for refund...once gotten financing (based on the s&P OMV price), the seller refunds the excess to me? do you mean sign an s&p to get the bank financing while agreed with seller on a lower price, then sign a supplemental agreement to get back the refund?

how do you go about doing this?

thanks,
mike
Back to top
View user's profile
mikewong



Joined: 02 Jun 2005
Posts: 7

PostPosted: Sat Jun 04, 2005 3:04 am    Post subject: Reply with quote

nick1994 wrote:
its very hard......most banks give lower of S&P or value......

try shopping the banks.....some may b desperate enuf....

and if all else fails ......theres a roundabout way.......but u'll need your own funds and u need a certain time lapse.....


thanks for your reply nick, if that's the case, the policy of lower of s&p and valuation is not consistent with all banks?

could you explain your roundabout way more detailed please?

thanks,
mike
Back to top
View user's profile
Banzai



Joined: 25 Oct 2004
Posts: 3367

PostPosted: Sat Jun 04, 2005 7:16 am    Post subject: Reply with quote

mikewong wrote:


Hi aimtrue and Banzai
thanks for the reply.

so basically banks would only finance the lower of s&p and valuation. ok...
banzai, you mentioned something about a supplemental agreement for refund...once gotten financing (based on the s&P OMV price), the seller refunds the excess to me? do you mean sign an s&p to get the bank financing while agreed with seller on a lower price, then sign a supplemental agreement to get back the refund?

how do you go about doing this?

thanks,
mike


PM
Back to top
View user's profile
nick1994



Joined: 24 Apr 2005
Posts: 6116

PostPosted: Sat Jun 04, 2005 8:27 am    Post subject: Reply with quote

if u can get the seller 2 up the S&P price in a side deal as suggested above, thats one simpler way.....

if not...

..well, if u were 2 ask for bank funding in an outright S&P....almost all will, in fact all, will only give u lower of S&P or market value......

...what i do normally, in fact have done, for one of my case......is buy the whole thing for cash.....

...after 3-4 mths...i took it 2 another bank and asked for refinancing.......in this instance of 'refinancing'......some will take the market value and not S&P price.......

...but u need 2 essential ingredients....

1) a source 4 the funds first....
2) ...maybe a 3-4 mths time lapse...
Back to top
View user's profile
Banzai



Joined: 25 Oct 2004
Posts: 3367

PostPosted: Sat Jun 04, 2005 9:40 am    Post subject: Reply with quote

Nick1994,

Good idea, never thought of that. I've never done a zero down deal before because i somehow have never been able to make it positive cash flow so i normally just shove in 10% anyway.
Back to top
View user's profile
nick1994



Joined: 24 Apr 2005
Posts: 6116

PostPosted: Sat Jun 04, 2005 11:29 am    Post subject: Reply with quote

..banzai....

..zero down with positive.....................possible......again, one important factor above all else.....

...the willingness 2 look hard and go for lots of viewing 2 source 4 it......

there was a time when every weekend, view an average of 2-3 potentials..........nowadays a bit lazy....sum more.....in mid term, i am in divestment mode........

Very Happy
Back to top
View user's profile
mikewong



Joined: 02 Jun 2005
Posts: 7

PostPosted: Sat Jun 04, 2005 12:38 pm    Post subject: Reply with quote

nick1994 wrote:
if u can get the seller 2 up the S&P price in a side deal as suggested above, thats one simpler way.....

if not...

..well, if u were 2 ask for bank funding in an outright S&P....almost all will, in fact all, will only give u lower of S&P or market value......

...what i do normally, in fact have done, for one of my case......is buy the whole thing for cash.....

...after 3-4 mths...i took it 2 another bank and asked for refinancing.......in this instance of 'refinancing'......some will take the market value and not S&P price.......

...but u need 2 essential ingredients....

1) a source 4 the funds first....
2) ...maybe a 3-4 mths time lapse...



wow...ok...
refinancing definitely gives you up to 90% of market value. that's a different way looking a financing a property what you just done there...

unfortunately...i dont have that amount of cash to put into a deal and re-fi later...that's why i want to cash out upon the deal and re-invest in other deals.
Back to top
View user's profile
Banzai



Joined: 25 Oct 2004
Posts: 3367

PostPosted: Sat Jun 04, 2005 1:11 pm    Post subject: Reply with quote

nick1994 wrote:
..banzai....

there was a time when every weekend, view an average of 2-3 potentials..........nowadays a bit lazy....sum more.....in mid term, i am in divestment mode........

Very Happy


Think i'll continue investing until i die. Boring lah after retirement.
Back to top
View user's profile
aramis



Joined: 02 Jun 2005
Posts: 156
Location: Cyberjaya / Old Klang Road

PostPosted: Sat Jun 04, 2005 1:20 pm    Post subject: Reply with quote

mikewong wrote:
Hi Aramis,

Thanks for your reply.
Just a question...if I'm getting a discount from the seller and asking him to jack up the s&p price...wouldn't he say...might as well you pay me full then...
or even if he says ok...and then give him 100k and he refuse to transfer title as s&p says 150k...
can an agreement be made to do have a formal s&p to get financing and another one just for the actual price.
when you both your properties for zero down...what was your strategy? to cash-out the excess from bank financing and reinvest or just to get a positive cash flow from rentals?

thanks
Mike

Well, be prepared to be asked a lot of question by the seller...that's common. Smile

Let say the property was 140k and you manage to jack up the S&P to 150K. You down payment should be 14K (10% of the actual price). What I did was my lawyer help me to draft a separate agreement, saying that I have paid 15k instead of 14K and ask the seller to sign it. This will deter the seller from claiming that you have under-paid him.

I guess there are other methods which some of the forumers have responded to you. Smile
Back to top
View user's profile
mercuri



Joined: 03 May 2005
Posts: 4599
Location: KL

PostPosted: Sun Jun 05, 2005 7:12 pm    Post subject: Reply with quote

Wahlau, never knew things like this existed, isn't this cheating? Shocked

But seriously I dun think this is against any law, right? basically it's an agreed thing between the buyer and seller only, any legal implications here? Razz
Back to top
View user's profile
aramis



Joined: 02 Jun 2005
Posts: 156
Location: Cyberjaya / Old Klang Road

PostPosted: Sun Jun 05, 2005 7:15 pm    Post subject: Reply with quote

For my case, the lawyer and the bank are well aware of it. The only thing is not many people does it.

Smile
Back to top
View user's profile
mercuri



Joined: 03 May 2005
Posts: 4599
Location: KL

PostPosted: Sun Jun 05, 2005 7:17 pm    Post subject: Reply with quote

I reckon reading the forum here is better than any books on real estate, never knew this can be done, perhaps in my next property I might try using the methods here! Laughing
Back to top
View user's profile
candic3



Joined: 07 Jun 2005
Posts: 96
Location: Alliance (Mortgage)

PostPosted: Tue Jun 07, 2005 6:23 pm    Post subject: Margin of Finance Reply with quote

Citibank - up to 89% (Property <150k)
Standard Charted Bank - 85%
HSBC & other local banks - 90%

Somethings that you should take note when you take up a loan.
1) Flexibility - allow you to make excess payment? do they need advance notice? what is the minimum amount of the excess payment? will the excess payment deduct principle or only as advance payment
2) Daily interest calculation - only benefits you when advance notice of prepayment not needed.
3) Total interest paid
4) Any hidden cost, esp withdraw excess payments.
5) What is the terms & conditions.

Not advisable to take package with conditions - bi-weekly.
Back to top
View user's profile MSN Messenger
Display posts from previous:   
Post new topic   Reply to topic    Malaysia Real Estate Forum Index -> Property Financing All times are GMT + 8 Hours
Page 1 of 1

 
Jump to:  
You cannot post new topics in this forum
You cannot reply to topics in this forum
You cannot edit your posts in this forum
You cannot delete your posts in this forum
You cannot vote in polls in this forum



This is a free forum intended to foster communication between all users.
Hileytech Sdn Bhd does not guarantee the correctness or validity of postings, nor does Hileytech endorse any postings. No posting or contents in this forum can be copied and reproduced without prior permission from Hileytech and the owner of the posting. All other names and marks are trade names, trademarks or registered trademarks of their respective owners.
Powered by phpBB, Another web site by www.hileytech.com,Forum Archive
Tel : +603-89449965, +603.89449365 ::  Fax : +603-89440665 :: hiley@hileytech.com