This is the final chapter on what are the things to look for when signing the letter of offer with the banker.
The last stretch.
Click here for Part 1
Click here for part 2
Continue from the 7th page
You should read on:
- Other terms and condition – Usually this is the part where the bank states that they will only release if certain conditions are met.On 5th July 2018 MAS revised the loan to value limits on the housing loan granted by bank, hence in this particular case, you can see the bank actually incorporate the before 5th July 2018 vs after 6th July 2018.You can read about the amendments by MAS on the banking regulation here.
Continuing on the 8th page :
You should check on :
- Insurance – Most banks requires you to buy fire insurance from their appointed insurance company or others in their appointed panel. Take note there might be a yearly administration fee if you wish to use your preferred insurance company.Do check if the insurance premium is paid separately by you in cash or by an auto deduction from the bank account.
- Tenancy – If the unit is tenanted for more then 6 months from the date of purchase, please inform your banker and law firm so they can inform the bank.
- Review of rates – Bank can revise the rates from time to time. Do take note that typically the interest will be much higher from the 3rd year onward, most people will do a refinancing or a repricing of the loan there forth.So when do you need to engage a lawyer? you can refer to the following.
Refinancing/Redemption – You need a lawyer to discharge the mortgage charge.
Re-pricing – No need lawyer as the mortgage is with the same bank but at a lower rate.
Cash/CPF Capital Repayment – No need lawyer as you are just clearing the loan with a lump sum.
- Not a license developer – This usually applies to private developer with little to no track records that purchase a piece of land to develop a small project or to build a couple of landed units on it.There are rules governing that they can only sell once the unit(s) gotten TOP/certified completed, thus the bank include this clause to protect themselves.
Continuing on the 10th page :
This is the acceptance page, basically you confirmed you understand the offer letter and all the clauses set forth within, points to take note:
- You have read all the T&C. a copy of the MAS notice 632 can be found here.
- For fixed rate, the interest will be variable after the first few years.
- For variable rate package bank will give you 30 days notice once the rate changes.
- For variable rate package pegged to market indices, bank do not have to give you any notice.
Continuing on the 11th page :
This is the acceptance page, the one that requires your autograph.
- Our solicitor is – check that its the solicitor you wanted.You will have to pay additional legal fees (on top of your own law firm) if the one you have appointed is not in the bank’s approve panel list. This is because the bank will need to appoint another law firm to act for them.
The additional fees ranges from $500 to $750.
- You can retrieve a copy of credit bureau report (a report on how good you are as a paymaster) from the credit bureau website.
Click here for part 2.
Click here for part 3.