We all know that going through any legal process requires a lot of legal knowledge and attention to detail. While it is possible to go through a conveyancing process without a conveyancer, usually people would still choose to hire a conveyancing lawyer as they are equipped with legal knowledge. Although it is vital to have a basic understanding of the conveyancing process before purchasing a property in Malaysia.
There are two parties that have to go through the conveyancing process, the seller and the buyer. We have previously discussed the conveyancing process when selling a property in Malaysia. In this article, we will be diving deeper into the step by step conveyancing process when purchasing a property in Malaysia.
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General Conveyancing Process
The conveyancing process consists of two parts. The first stage requires the seller to draw up a legal contract. The second stage is confirmation and handover. While it may sound simple in writing, but in reality, the conveyancing process takes up a lot more than that.
You can choose to go through the conveyancing process yourself or hire a lawyer to help you through the process. Generally, people tend to choose the latter as it requires legal knowledge to go through the process by yourself. If you are looking to hire a conveyancer, you can find more tips on how to choose your conveyancer or conveyancing lawyer.
Conveyancing Process Without A Lawyer
Hiring a lawyer comes with costs that you have to agree on prior to hiring. If you are not up to hiring a professional, you may consider going through the process yourself.
Title Of The Property
The title of an estate refers to the document that states the ownership of the property. In places like apartments, the tenants receive strata titles as an owner for one unit, but the owner of the whole building or land would have the big title. This might become an issue because when a strata titleholder is selling their property, the transaction would go on without a title. The process would become a little more complicated when this happens.
Encumbrance of a property refers to the conditions that might impact the process of the ownership transfer of the estate. Encumbrance on the property may be in the form of a mortgage, easements, or property tax liens.
To be safe in your conveyancing process, you should check by doing a land and title search and find out whether it is an immovable property. In the case where a property becomes an immovable property, and ownership transfer could not happen. This simply means that a conveyancing process can never take place and you should look for an alternative property.
Consent and Restrictions
Executing a land and title search would also reveal if there are any restrictions on the estate. If there are restrictions from the State Authority, then one must apply for consent to state authority for an ownership transfer of the said property. The application process and requirements may vary as each state has its own set of rules and regulations for an ownership transfer.
Generally, the application might take two to six months, but if there are any issues, the application might take even longer. Hence, this is one of the tricky parts of the conveyancing process.
Forms and Stamp Duty
Here comes the most dreaded part, which is filling up the forms and completing all information. It helps to keep your documents neat in a folder and do not fold your documents. Folding documents might increase the chances of missing documents. Keeping your documents neat would also ease the process of cross-checking your important documents.
Ensure that you have your documents and forms in their order. Remember to include the Sales and Service Tax (SST) document as well as the Real Property Gains Tax (RPGT) document. When you have all your documents ready, you may proceed to submit your documents to the land office.
After filing your correct documents in order, one must proceed to pay for the stamp duty. One must submit your ownership transfer documents to the Inland Revenue Board of Malaysia or LHDN and they will give you a notice stating the amount that you need to pay for stamp duty.
After submitting all your documents, all there’s left to do is to wait until your documents are verified and approved by the authorities. The step by step conveyancing process might be complicated for individuals. This is why people tend to hire lawyers to help them complete the conveyancing process and help to ensure that they are buying property from a trusted seller.
A lawyer would be able to guide you through the step-by-step conveyancing process and give you professional advice along the way. If you are concerned about going through the conveyancing process, do not hesitate to consult Sim & Rahman for professional guidance on the conveyancing process.