Malaysia House Purchase FAQ
What is Booking Fee?
Booking fee is also known as reservation fee. This fee is normally paid by buyer to the seller to reserve the property. After seller received the booking fee, an official receipt should be given to the buyer, and the property will be keep on-hold for the said buyer.
After done booking or reserve for the property, buyer can go to apply for house loan (mortgage) at banks. Usually the booking period is 14 days up to 30 days (this is normally negotiable between seller and buyer).
If buyer decide to give up on the property, the booking fee will not be refunded.
If buyer loan is rejected, depends on the agreement between seller and buyer, some seller will refund the booking fee, some seller refund 50% of the booking fee, while some will not refund the booking fee.
What is Down payment?
A down payment is a lump sum payment, usually paid in cash, in the early stages of a purchase, such as a house or a car. Down payment for property in Malaysia is set to minimum 10% of the price of the property. But, buyer can opt to pay more than this minimum amount.
Example: A house is selling at RM600,000, the down payment will be RM60,000 (10% of the selling price).
What is Agent Fee?
Based on the information on the Malaysian Institute of Estate Agents (MIEA), for the sale and/or purchase of land/buildings within Malaysia, the maximum fees or commission agent can get is set to 3% of the property’s sale price.
Property Agent normally has a long list of properties, buyer can contact property agent to get information about the properties. Property agent is also responsible to bring buyer to visit the property, help seller find buyer, help buyer and seller get the best deal and etc.
If the sale and/or purchase of the land/building in Malaysia is successful, the agent will get paid Agent Fee , also known as commission.
What is Memorandum of Transfer (MOT)?
Memorandum of Transfer also commonly known as MOT. It is a document which will have your name endorsed and registered in the individual title to the property. This document transfers of the title of the property to you as the owner, ensures your right as the owner of the property.
Stamp Duty on MOT also known as MOT fee, is considered the biggest fee among all other fees, so buyer need to take note on this when making a property purchase. Table below shows the Stamp Duty charges for MOT.
|Stamp Duty on MOT|
|MOT on 1st RM100,000||1%|
|MOT on RM100,001 – RM500,000||2%|
|MOT on RM500,001-RM1,000,000||3%|
|MOT on RM1,000,001+||4%|
Note: Stamp Duty on MOT will change from time to time depends on Government decision.
You can use our Cost of House Purchase Calculator (Malaysia) to do the calculation and get an estimation.
What is Sales and Purchase Agreement (SPA)?
First of all, Sale and Purchase Agreement is not MOT. Sale and Purchase Agreement commonly known as SPA or SNP. It is the sales and purchase contract between seller and buyer (ie: developer(seller) and you(buyer), seller and you(buyer)). It clearly indicate the terms and conditions of the purchase and is a legal binding document of the purchase.
Normally, this document is prepared by lawyer, so it will be charged certain amount of fees, known as Legal Fees (hence, Legal Fees on SPA). The fees are charged based on tier and percentage, normally as follows:
|Legal Fees on 1st RM500,000 (1%)||1%|
|Legal Fees on next RM500,000 (0.8%)||0.8%|
|Legal Fees on next RM2,000,000 (0.7%)||0.7%|
|Legal Fees on next RM2,000,000 (0.6%)||0.6%|
|Legal Fees on next RM2,500,000 (0.5%)||0.5%|
|Property above RM7.5million (negotiable)||Negotiable|
Note: Legal Fees on SPA will change from time to time and might varies among different lawyers.
You can use our Cost of House Purchase Calculator (Malaysia) to do the calculation to get an estimation.
What is Stamp Duty on Loan Agreement?
When buyer purchase a property, normally will take up house loan or mortgage with bank. Any purchase of property that involve Loan (mortgage) will have Loan Agreement and it is subjected to 0.5% Stamp Duty on the total amount of the loan.
Example: House Loan RM250,000, Stamp Duty on Loan Agreement will is RM250,000 x 0.5% = RM1,250.00
What is Statutory Declarations for House Purchase in Malaysia?
In the case of House Purchase in Malaysia, Statutory Declarations is signed by Purchaser to declare that he/she is not a bankrupt person or declarations that you would use the property for your own occupation.
What is Memorandum of Charge for House Purchase in Malaysia?
This Memorandum of Charge is a document to guarantee the bank as the mortgagee (pemegang gadaian) so we need to include the name of the bank in our property. We purchase property using the mortgage loan from the Bank, and so the property will be charged to the bank and bank will be the mortgagee (pemegang gadaian) of the property.
Present this document at the land office with a stamped transfer form (MOT) and pay stamp duty and other required documents, to register in the name of the buyer and the bank to land office.
No worries, all these procedures will be done by the lawyer firm and developer. As purchaser/buyer, we only need to sign the related documents only.