All about OTP / S&P

At the showflat, if you decide to commit you will need to give a 5% cheque of the purchase price to declare your interest via “Expression of interest (EOI)” form.

During the balloting If you get your preferred unit on the balloting day you will be receiving the following documents:

• Option to purchase – An Option to Purchase agreement is a legal contract signed between a buyer and seller of a residential property, and basically gives a buyer the exclusive rights to purchase a property from a seller in the future.  
• Purchasers’ particular form. – A form to record down your details ie your NRIC number, correspondence address etc, you can also indicate your request here.
• Annexures and side letters. – Information and specifications on the unit that you are purchasing. etc membership, furniture discount, specs on the project etc.
• Letter of Authorisation.

After the balloting the developer will be sending the Sales and Purchase agreement to your law firm,

The sales and purchase agreement will contain details about the your unit, such as purchaser’s details, price, size, address, material used by the developer etc. Once received, the law firm wil arrange for an appointment with you.

The developer will provide you with a set of particulars, documents and information related to the housing project and unit that you are interested in before accepting the booking fee, which will include the following:

• Scaled location plan, site plan and unit floor plan.
• Strata area of strata-titled properties, which is the amount of space sold to a buyer based on the strata boundary of the unit. To ensure that the property meets your needs, please review the strata area breakdown e.g. area of bedroom, balcony, air-conditioner ledge and void area. To understand more on void areas, you may refer to SLA’s infographic.
• Specifications of the building e.g. floor materials, common facilities, appliances provided.
• General description of the housing project, including:
• Total number of units in each class
• Number and type of car parking lots provided, e.g. surface parking lots,
  mechanical parking lots or handicapped lots. If the number of car parking lots provided is less than the number of housing units and you are a car owner, you should check with the developer on the method of allocation of the car parking lots.
• Conditions and restrictions imposed by the authorities. Some projects may be affected by public schemes such as drainage reserves, road reserves, sewage pipes and electrical cables. There may be specific conditions imposed by the relevant authorities in relation to these public schemes which may affect the liabilities of the owners or residents of the housing project after its completion.
• Amendments to the prescribed Sale and Purchase Agreement (S&PA), as approved by the Controller of Housing. Past projects completed by the developer or its related companies. You should review the information carefully to ensure that the housing project and unit meet your needs before making any payment. You do not have to proceed with the purchase, if you
  do not wish to after reviewing the information. The developer is required to obtain written acknowledgement from you that these mandatory information has been provided to you.
• The developer is also required to make available the Schedule of Strata Units for strata-titled properties, showing the share values assigned to each unit. The share value assigned to your unit will be the basis for computing the maintenance charges payable by you.

For the OTP, you need to ensure your personal details are correct and also take note of

• Block and Unit number.
• Size of the unit.
• Purchase price.

For the S&P, the crucial things that your lawyer will go through with you are as follows:

1. The progressive payments.
2. The last 15% and how it will be apportioned and paid to whom(developer’s account).
3. Repudiation– 14 days to pay for each payment. Developers will serve all homeowners a 21-days’ notice if they fail to make the payment on time.
4. Errors and omission– Developer will be liable to compensate you if there are >3% in error as what was promised to you for your unit after it is built and ready by Temporary Occupancy Permit (TOP) date.
5. Defects Liability Period– You have exactly one (1) year from the date of TOP Notice (The day the developer serves the TOP Notice letter to your law firm).

Yes you can, but subject to the developer and COH (Comptroller of housing).

Your law firm will first need to write to COH to seek for approval, COH will reply they are ok subject to developer is also ok (assuming that COH approves).

The developer will then give its approval (or not).

Do note that the law firm will charge additional legal fees.

Exercising the Option
If you are granted an OTP, the developer is required to deliver the S&PA and the original or
copies of the title deeds to you or your lawyer for review within 14 days from the date of the
Option.

If you decide to proceed to purchase the property, you need to exercise the Option by doing
all of the following before the Option expires, i.e. 3 weeks after the date of delivery of the S&P
and title deeds to you:

• Sign all the copies of the S&P.
• Return all copies of the signed Agreement to the developer.
  The developer will keep a copy, the bank will keep a copy and the developer law firm will keep a copy.
• Pay to the developer the balance down payment, which is 20% of the purchase price less the booking fee paid

Non-Exercise of Option
If you do not wish to exercise the OTP, you can serve a written notice to the developer stating
that you do not wish to exercise the Option. The Option will lapse immediately upon the receipt by the housing developer of the written notice.

If the OTP is not exercised before its expiry, the developer may forfeit 25% of the booking fee
and refund 75% of the booking fee to you. The developer can then proceed to sell the unit to
any other interested party.

These are the following steps to abort your purchase.

1. Give a written confirmation to the law firm by email.
2. Law firm will write to the developer to abort your case, developer writes back to confirm the same.
3. You will need to return all documents to the developer. ie OTP, S&P, side letters and annexes.
4. Developer will take about 3 weeks to refund you 75% of the 5%.

If you have exercised the sales and purchase agreement but you decided not to proceed, do note that you will lose full 5% paid and potentially more.

• The developer might bring you to court and sue you for more money.
• The developer will re-market your unit to others.

And if you have signed the letter of offer, draw down the CPF funds.

• The bank will charge you cancellation fees (typically 1.5% of the disbursed loan amount).
• Developer will refund you in about 4-5 weeks, and your CPF will need to be refunded (with accrued interest).
• Law firm will charge you abortive fees.

These are the following steps to abort your purchase.

1. Give a written confirmation to the law firm by email.
2. Law firm will write to the developer to abort your case, developer writes back to confirm the same.
3. You will need to return all documents to the developer. ie OTP, S&P, side letters and annexes.
4. Developer will take about 3 weeks to refund you (if there’s any cash to be refunded).

No, deferred payment scheme only works for EC. it no longer works for normal private condominium .