Tips for Purchaser when inspecting property and before signing Booking Form

1. Inspecting Property

   1. Check the condition of the property thoroughly (for example : whether there is any water leakage, any cracks on the wall, any defects). If possible, bring along your own contractor/professional personnel to assist you during inspection.
   2. It is advisable to take photo(s) of different areas of the property, especially those defects discovered during the inspection.
   3. Request a copy of the title if possible and conduct a land search on the title. You may engage a lawyer to conduct the land search and to advise you accordingly.

2. Before Signing Booking Form

   1. Check the Booking Form whether the agreed purchase price and the arrangement in the payment of earnest deposit, balance deposit and balance purchase price.
   2. Generally, the completion period written in the Booking Form is 3 months/90 days and the extended completion period is 1 month/30 days from the date of the sale and purchase agreement/consent to transfer/receipt of developer confirmation letter.If you require longer time to complete the deal, negotiate with the seller.
   3. Communicate with the seller if you require the seller to repair the defects discovered during inspection. Remember to write it down if the seller agrees to repair the defects as requested.
   4. If the property is sold with fixtures and fittings, it is advisable to take photos of those fixtures and fittings and state all items in the Booking Form. If possible, please mention that those items are to be given to you in working conditions.
   5. When property is currently tenanted, you will have to decide whether you wish to take over the existing tenancy from the seller upon completion.If you wish to take over the existing tenancy, ask for information of the current tenancy such as the tenancy tenure, monthly rental, deposits collected from the existing tenant and etc so that you can expect how much rental you will be collecting after taking over the tenancy.
      If you wish to have the vacant possession, tell the seller so that he/she can make necessary arrangement with the existing tenant.
   6. There is a time frame for the Purchaser to sign the sale and purchase agreement i.e. within fourteen (14) working days from the date of the acceptance of the Booking Form/Offer to Purchase by the seller (“Signing Time Frame”), failing which, the seller is entitled to forfeit the earnest deposit (or more commonly known as ‘booking fee’) paid.If you intend to apply for a loan to finance the purchase of property, 14 working day is hardly sufficient for you to obtain loan approval from the bank.Hence, ask from the seller to allow at least fourteen (14) working days for you to obtain loan approval with the preferred loan margin, failing which, the earnest deposit will be fully refunded to you.Example : Purchaser shall obtain loan approval at margin of 90% of the Purchase Price within fourteen (14) working days from the from the date of the acceptance of the Booking Form/Offer to Purchase by the seller, failing which, the earnest deposit shall be fully refunded to the Purchaser.
      Upon loan is approved at preferred margin, the Signing Time Frame shall start to commence.

Finally and most importantly, make sure all special arrangements are stated in the Booking Form and sign the same.

This article is written by 

Liew Chen Siang
Partners, Low & Partners

Yap Yie Laine
Senior Associate, Low & Partners