Forging on, midway only.
Onwards! the fourth page.
You should check on :
Cancellation fee – take note that the penalties is 1.5% of the disburse loan, meaning to say if you sign the offer letter today, and you decide to cancel it tomorrow, you will have to pay 1.5% of the loan. That’s really hefty for one wrong move. Common scenarios are couple breaking up before the lock in period is up or divorce etc.Do check if they include other conditions that allows you to cancel without penalties like for this example if HDB doesnt approve the EC purchase.
Bank loan validity – This is quite standard 6 months unless otherwise stated. You can request for your banker to extend the validity for some cases ie OTP will only be exercised more then 6 months later (applies for resale private).
Other special conditions – Depending on banks, the type of property purchased and profile of the borrowers, there are conditions to be fulfilled.Valuation – Most common across all banks, the valuation must not fall below what the bank’s valuer value at. The bank needs to protect its loan from any loses, can you imagine they lend you 75% loan, but the property value is only valued at a much lower rate, that will not be inline with regulations set by MAS.
Continuing on the 5th page :
- Administrative Fee – Some banks charge this administrative fee, it its actually the fee for doing the valuation on the unit. It ranges from $80 (desktop valuation for under construction property) to more then $500-$1000 (on site valuation for completed property).This amount can be found in the letter of instructions which is sent separately to the law firm. Your law firm will inform you how much to pay to them so that they can issue to the bank using their company cheque. This is because, the bank will not accept client’s personal cheque.
- Letter of Undertaking to sell your current property – This is to undertake that you promise to sell your current property. If for some reasons your sale cannot be completed or has to be delayed ie buyer goes bankrupt, divorce pass away due to outside factors which you have no control over, please inform your law firm so they can do the needful.If your sale cannot be completed due to your own reasons, ie divorce, break up, seller remorse, realised there’s SSD payable etc, then you have to prepared to pay the penalties.
- Tenancy agreement – If the unit is tenanted at the point of purchase, the law firm will need to give a copy of the tenancy agreement to the bank. Its because if you are unable to pay the monthly installment one day, the bank will take the rental proceeds from you.
- Spousal consent. – If you are married, but you are buying the property under your name or with someone else (not your spouse) then you will be required to sign a spousal consent form for your spouse to be aware and give you consent to buy this property. Only spouse of certain countries will need to sign, so this means you will need to fly your spouse in to meet the lawyer if they are abroad.
You can read more about spousal consent form here. (its located at the mid section).
- Mailing address – If you are staying abroad long term, you must appoint someone with a valid Singapore address so that the bank can mail the letters to you. No P.O box allowed.
- Pledging – You will need to keep and maintain funds in your account and show proof if the bank asked for it.