Tenancy agreement will state date of paying rental for every month and the mode of payment. Normally there are 2 situations when the tenant does not make payment for rental.
1. Lost contact with the tenant – this is a simple situation where landlord can just wait for him to contact or terminate the contract with immediate effect.
2. Able to contact with tenant who is still staying in the unit but tenant keep on delaying on the rental payment– this is a tougher situation where landlord may set the due date of payment and solution on the issue.
If condition is allowed, accept the delay for a few days which within agreed period.
Example: Set a deadline and inform the tenant if there is always delay in rental payment. The situation is always not beneficial to the landlord if there is any unpleased situation.
Normally landlord will collect 2 months of security deposit from tenant. Landlord should take action when the tenant do not pay 1 month rental and never agree to pay off rental by using the deposit. This is to avoid the situation when tenant leaving the house without notice and owner might need to pay all the repair fees of house and furniture damage.
* Situation 1: Lost contact with the tenant *
(Timing: Unable to contact with the tenant for more than 2 weeks and there is no payment for rental)
1. Leave a memo outside the rental unit and stated that action will be taken if no payment receive before a specific date (For example: If there is no payment made by XXX date, we will cut off the electricity and water supply or report to police to take back the unit). Capture photo of it and record the date.
2. If there is no reply, cut off or suspend the water and electricity supply (Or directly to the next step)
3. If there is still no reply from tenant, make a report at Police Station. Request companion from police or with the security to enter the house for inspection.
4. Only enter the rental unit with third party and take photo or video. This is to avoid tenant blaming the owner if they lost their things.
5. Check the rental unit condition (appliances and systems) and if the unit is still occupied. Besides that, check with neighbours on when they saw the tenant for the last time. Before leaving the unit, change the lock and leave a memo (with last date to clear off the house) with attach police report record copy.
6. Lastly, decide when to clear the unit if there is still not reply from the tenant.
* It is reasonable for landlord to enter the property and check is that any accident happens if the tenant lost contact for 2 weeks till 1 month.
* Do not enter the rental property before making police record.
* Situation 2: Able to contact with tenant who is still staying in the unit but tenant keep on delaying on the rental payment*
1. Call the tenant to chase for payment: If condition allowed, tolerate and set a due date of payment with condition (for example: cut off the electricity and water).
2. If the tenant agreed on the date and condition, request tenant to confirm by written message (sms or email).
3. Cut water and electricity supply: For condominium, landlord can inform the management to cut the supply until further notice.However, for landed property, landlord might need to apply it in SYABAS.
4. If the tenant remains staying in the unit, landlord needs to appoint lawyer to apply for court order and inform the tenant to move out according to law procedures.
* The most appropriate way is applying court order through lawyer and inform tenant to move out. The procedure is not time consuming.
*Basically, tenant will move out if the water and electricity supply is cut off. However, there are some tenants who will destroy the unit. In this case, landlord can only repair it by using the deposit and take it as a lesson.
*Settle the issue as soon as possible to avoid all the deposits are used up for unpaid rentals and in the end of the day landlord needs to bear for the repair fees.
Monday, October 29, 2012
What is 3 + 1 ?
After both parties signed sell & purchase agreement, in S&P will specify the deadline that buyer need to pay off to homeowner. Generally is 3 months period, otherwise buyer need to pay daily interest starting on the 4th month. After 3+1 homeowner has right to cancel the deal while forfeited the deposit.
1. When "3+1" start calculate?
depend on house title
Freehold : start to calculate after sign on S&P.
Leasehold : start to calculate after getting the letter of consent.
2. What happen 3+1 is over?
When 3+1 over, if buyer’s responsibility (no matter what reason), owner has right to cancel the deal, while forfeited 10% of the deposit from the buyer.
How to calculate 8% after the 4th month?
* (Deal price) x (delay days) x 8% / 365 days = Compensation amount *
* For example: 400K(deal price) x 7days(delay days) x 8% / 365 days= RM613.69
After 3+1 over, homeowner has right to forfeit 10% of down payment from the buyer and open for sale again.
Remind:
The safest way is buyer to sign on the bank loan letter offer (make sure loan is approved), then only to sign the SPA afterward loan agreement. On general procedures as long as the documents get ready, no problem to catch up the 3+1 process.
It is more concerned that some of the buyers as certain factors after sign on the S&P in period of time then only apply for bank loan, or keep delaying on the incomplete documents. The late charges of 8% interest quite a considerable amount, the worst situation when over 3+1 homeowner forfeited 10% of the down payment.
1. When "3+1" start calculate?
depend on house title
Freehold : start to calculate after sign on S&P.
Leasehold : start to calculate after getting the letter of consent.
2. What happen 3+1 is over?
When 3+1 over, if buyer’s responsibility (no matter what reason), owner has right to cancel the deal, while forfeited 10% of the deposit from the buyer.
How to calculate 8% after the 4th month?
* (Deal price) x (delay days) x 8% / 365 days = Compensation amount *
* For example: 400K(deal price) x 7days(delay days) x 8% / 365 days= RM613.69
After 3+1 over, homeowner has right to forfeit 10% of down payment from the buyer and open for sale again.
Remind:
The safest way is buyer to sign on the bank loan letter offer (make sure loan is approved), then only to sign the SPA afterward loan agreement. On general procedures as long as the documents get ready, no problem to catch up the 3+1 process.
It is more concerned that some of the buyers as certain factors after sign on the S&P in period of time then only apply for bank loan, or keep delaying on the incomplete documents. The late charges of 8% interest quite a considerable amount, the worst situation when over 3+1 homeowner forfeited 10% of the down payment.
How to choose tenant ?
It is not an easy task to look for good tenant. The relationship between tenant and landlord is long term and must be stable and communicable. Hence, there a several suggestion on how to choose a good tenant
* Do not rush *
It is a long term contract for at least a year. Although there might be pressure of paying the installment, but it is better to choose rationally to keep away from problematic tenant.
* Choose good tenant instead of good rental *
Although it is good to rent the unit with high price, but the quality of tenant is far more important. It is not easy to get a good tenant; hence it is wise to lower down the rental and getting a good tenant. This will keep you away from all the hassle like late payment or receive complains from the neighbors.
* Tenant with stable and legal occupation *
Landlord should request for business card or any proof from the tenant to show that he/she is working in legal company. Tenant who do not have stable job might delay in payment. If anything happen in the unit and the tenant is found not work illegally, it will create endless hassle to the landlord.
* Ask for moving reasons *
This is an important way to filer the tenant. Landlord should check on the reasons of moving and details of their last stayed. Landlord may contact with their previous landlord to know their payment promptness, their cleanliness and some other information.
* Problematic Tenant *
There are several types of problematic tenant. Apart from the hassle from tenant, the prices of that housing area will fall too. So, instead of detach with the problematic tenant, it is better to choose a tenant wisely.
* Look for long term and stable tenant *
Despite the rental price increase yearly, it is still a type of cost saving to have a long term and stable tenant. It is tiring to go through all the hassle every year. The additional expenses involved as:
* Maintenance fees like repainting, refurbishment and cleanup cost.
* Additional 1 month agent commission
* Installment burden of the unit while looking for new tenant
* Administration jobs
* Insist to collect sufficient deposit *
If tenant is unable to pay 2+1+0.5 utilities deposit, it is risky to collect monthly rental on time from the tenant. Deposit is the safe guard to the landlord in order to get back the unit in well condition.
* Interview and understand the tenant *
Before signing the agreement, it is better for the landlord to interview or understand the tenant well. Since all the details like chasing for rental, solving tenant problem should be handled by the landlord and not the agent, hence decision should be made by landlord and not agent.
* Do not rush *
It is a long term contract for at least a year. Although there might be pressure of paying the installment, but it is better to choose rationally to keep away from problematic tenant.
* Choose good tenant instead of good rental *
Although it is good to rent the unit with high price, but the quality of tenant is far more important. It is not easy to get a good tenant; hence it is wise to lower down the rental and getting a good tenant. This will keep you away from all the hassle like late payment or receive complains from the neighbors.
* Tenant with stable and legal occupation *
Landlord should request for business card or any proof from the tenant to show that he/she is working in legal company. Tenant who do not have stable job might delay in payment. If anything happen in the unit and the tenant is found not work illegally, it will create endless hassle to the landlord.
* Ask for moving reasons *
This is an important way to filer the tenant. Landlord should check on the reasons of moving and details of their last stayed. Landlord may contact with their previous landlord to know their payment promptness, their cleanliness and some other information.
* Problematic Tenant *
There are several types of problematic tenant. Apart from the hassle from tenant, the prices of that housing area will fall too. So, instead of detach with the problematic tenant, it is better to choose a tenant wisely.
* Look for long term and stable tenant *
Despite the rental price increase yearly, it is still a type of cost saving to have a long term and stable tenant. It is tiring to go through all the hassle every year. The additional expenses involved as:
* Maintenance fees like repainting, refurbishment and cleanup cost.
* Additional 1 month agent commission
* Installment burden of the unit while looking for new tenant
* Administration jobs
* Insist to collect sufficient deposit *
If tenant is unable to pay 2+1+0.5 utilities deposit, it is risky to collect monthly rental on time from the tenant. Deposit is the safe guard to the landlord in order to get back the unit in well condition.
* Interview and understand the tenant *
Before signing the agreement, it is better for the landlord to interview or understand the tenant well. Since all the details like chasing for rental, solving tenant problem should be handled by the landlord and not the agent, hence decision should be made by landlord and not agent.
Any refund if buyer loan not approved ?
Deposit is a commitment from the buyers to the sellers before signing S&P. It means, the owner shouldn’t sell the unit to the other party in an agreed period. Otherwise, the owner needs to compensate the buyer with double of deposit. However, if the buyer breaks his/her promise, the deposit will not be refund.
To owner, if the buyer had paid for the deposit but end up do not buy, they are wasting their time and might lost some potential buyers. At the same time, to buyer, it is very sad if they have strong intention to buy the unit and had paid for the deposit but their loan is not approved.
Suggestion:
1. If the there is no others buyer, the owner may accept “SUBJECT TO LOAN” by setting an “On-hold Period”
2. If there is other buyer who is interested, owner may explain to the buyer on their situation and clarify that once deposit is given and it will be no refund.
3. To avoid all the hassle and be fair to both parties, buyer should check the Loan status/ property value. Buyer can pay the deposit once the loan is approved.
** Communication is crucial. Buyer has to bear the full responsibility if owner had highlighted that deposit is not refundable.
It is complicated if the agent is involved in the deal. In normal case, agent will try to collect half of the commission as they have done their duties. In this case, it is much depends to the written agreement and willingness of owner. Some of the owner will refund the deposit or half amount of the deposit although they have informed that “DEPOSIT IS NOT REFUNDABLE”.
There are several cases of unethical agent in the markets who pockets the deposit, for example:
Agent pocketed the deposit by convinced the owner to return the deposit but in fact it was returned to the buyer.
To owner, if the buyer had paid for the deposit but end up do not buy, they are wasting their time and might lost some potential buyers. At the same time, to buyer, it is very sad if they have strong intention to buy the unit and had paid for the deposit but their loan is not approved.
Suggestion:
1. If the there is no others buyer, the owner may accept “SUBJECT TO LOAN” by setting an “On-hold Period”
2. If there is other buyer who is interested, owner may explain to the buyer on their situation and clarify that once deposit is given and it will be no refund.
3. To avoid all the hassle and be fair to both parties, buyer should check the Loan status/ property value. Buyer can pay the deposit once the loan is approved.
** Communication is crucial. Buyer has to bear the full responsibility if owner had highlighted that deposit is not refundable.
It is complicated if the agent is involved in the deal. In normal case, agent will try to collect half of the commission as they have done their duties. In this case, it is much depends to the written agreement and willingness of owner. Some of the owner will refund the deposit or half amount of the deposit although they have informed that “DEPOSIT IS NOT REFUNDABLE”.
There are several cases of unethical agent in the markets who pockets the deposit, for example:
Agent pocketed the deposit by convinced the owner to return the deposit but in fact it was returned to the buyer.
What is Master Title ? Strata / Individual Title ?
*** Master Title ***
(It is master title, which developer is the land holders)
Before the existence of Strata Title/ Individual Title, developer will be the land holders in Master Title. Developer has the right to control all the transactions of the land.
After the units are sold out, developer will apply for transfer of ownership of the land. Each unit will have separate /Pemilik Tanah /according to the owner of the unit. According to government rules,
developer must transfer the ownership of land to the house owner within 6 months after CF is approved.
(Why there is housing area which still under Master title after several years? Because...Malaysia Boleh!)
*** Strata Title ***
(Separate lease issued to owner of sub-divided property)
Strata title only happen in Sub-Divided Property like condominium, apartment, townhouse, flat and etc. It is known as Strata Title when there is a few houses on the same land but with different lease.
*** Individual Title ***
(Separate lease issued to owner of landed property)
All the landed property like terrace house, bungalow, semi-D and etc will have separate land holders. Land holders are the owner of the landed property and this is known as individual title. However, there are some of landed property who share the facilities is consider as Strata Title.
*** Influence of Master Title or Strata Title/ Individual Title to owner ***
Master Title: Developer is the land holder
Strata Title/ Individual Title: House owner is the land holder
1. If it is under Master Title, all transaction must be approved by the developer
2. If the property is under Master Title, but the developer is bankrupted, it is not recommended to buy the property. This is because it is difficult to get the title and bank loan is hardly approved.
3. If a 10yrs property which is still under Master Title, normally bank will not approved the loan.
4. It will influence the transaction process time.
5. If the property is under Master Title, buyer is unable to buy the house using the money in EPF.
FAQ
Q : How to know it is Master Title or Individual Title/ Strata Title?
A : Check if previous S&P indicated it is individual title/ Strata title ,check Geran, it will be indicated ,and check with developer for latest updated
Q : If property under Master Title, is transaction allowed?
A : Yes, but it must be approved by developer since developer is the land holder.
Q : Can we sell the unit if transferring of land ownership by developer is in process?
A : It is allowed to do direct transfer if the application of transferring land ownership was sent. The owner does not need reapply for transfer to the buyer. However, if the application is yet send,
then direct transfer is not allowed.
Q : Who should do the application of Individual Title/ Master Title?
A : Developer needs to apply with State Government and acknowledge all the units’ owner.
Q : Is that any influence if the unit is under Master Title and owner is staying in the unit?
A : If the owner does not have intention to sell the unit, it doesn’t matter. However, it is still advisable to get the title for protection purposes (in case the developer is bankrupt)
Q : If the unit is under Master Title and developer is bankrupt, should owner inform the buyer?
A : Yes, do not hide it because the buyer will know it sooner or later especially when they apply for bank loan and S&P.
Q : How to get Individual/ Strata Title if the unit is under Master Title while developer is bankrupt.
A : It is very complicated. The owner from each units can set up a committee and collect a fund (bayaran khas tanah), and apply from the state government to get back the land ownership. Owner should pressure the developer to get the Individual Title/ Master Title as soon as possible.
(It is master title, which developer is the land holders)
Before the existence of Strata Title/ Individual Title, developer will be the land holders in Master Title. Developer has the right to control all the transactions of the land.
After the units are sold out, developer will apply for transfer of ownership of the land. Each unit will have separate /Pemilik Tanah /according to the owner of the unit. According to government rules,
developer must transfer the ownership of land to the house owner within 6 months after CF is approved.
(Why there is housing area which still under Master title after several years? Because...Malaysia Boleh!)
*** Strata Title ***
(Separate lease issued to owner of sub-divided property)
Strata title only happen in Sub-Divided Property like condominium, apartment, townhouse, flat and etc. It is known as Strata Title when there is a few houses on the same land but with different lease.
*** Individual Title ***
(Separate lease issued to owner of landed property)
All the landed property like terrace house, bungalow, semi-D and etc will have separate land holders. Land holders are the owner of the landed property and this is known as individual title. However, there are some of landed property who share the facilities is consider as Strata Title.
*** Influence of Master Title or Strata Title/ Individual Title to owner ***
Master Title: Developer is the land holder
Strata Title/ Individual Title: House owner is the land holder
1. If it is under Master Title, all transaction must be approved by the developer
2. If the property is under Master Title, but the developer is bankrupted, it is not recommended to buy the property. This is because it is difficult to get the title and bank loan is hardly approved.
3. If a 10yrs property which is still under Master Title, normally bank will not approved the loan.
4. It will influence the transaction process time.
5. If the property is under Master Title, buyer is unable to buy the house using the money in EPF.
FAQ
Q : How to know it is Master Title or Individual Title/ Strata Title?
A : Check if previous S&P indicated it is individual title/ Strata title ,check Geran, it will be indicated ,and check with developer for latest updated
Q : If property under Master Title, is transaction allowed?
A : Yes, but it must be approved by developer since developer is the land holder.
Q : Can we sell the unit if transferring of land ownership by developer is in process?
A : It is allowed to do direct transfer if the application of transferring land ownership was sent. The owner does not need reapply for transfer to the buyer. However, if the application is yet send,
then direct transfer is not allowed.
Q : Who should do the application of Individual Title/ Master Title?
A : Developer needs to apply with State Government and acknowledge all the units’ owner.
Q : Is that any influence if the unit is under Master Title and owner is staying in the unit?
A : If the owner does not have intention to sell the unit, it doesn’t matter. However, it is still advisable to get the title for protection purposes (in case the developer is bankrupt)
Q : If the unit is under Master Title and developer is bankrupt, should owner inform the buyer?
A : Yes, do not hide it because the buyer will know it sooner or later especially when they apply for bank loan and S&P.
Q : How to get Individual/ Strata Title if the unit is under Master Title while developer is bankrupt.
A : It is very complicated. The owner from each units can set up a committee and collect a fund (bayaran khas tanah), and apply from the state government to get back the land ownership. Owner should pressure the developer to get the Individual Title/ Master Title as soon as possible.
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