What does the Purchasers’ solicitors do?
Prior to exercising the Option, the buyers’ solicitors would conduct the following checks:
1. Title Search
A title search would reveal:
- ownership - the seller must be the owner of the property
- area of the property
- whether the owner had used CPF moneys or taken a bank loan.
2. Bankruptcy Search
The buyers’ solicitors must do bankruptcy search on all the sellers to ensure that none of them is bankrupt.
If the buyer is using a bank loan to pay the 9% of the purchase price to exercise the Option (this loan is called a Bridging Loan), then the buyers’ solicitors must do a bankruptcy search and any other searches as required by the Bank to be done on the buyer.
Once the buyer has exercised the Option (i.e. the buyer’s solicitors enclose the original signed Option and the 9% of the purchase price), then the sellers’ lawyers must send out Notices of Redemption to the Bank and CPF Board.
When should I engage the service of a lawyer?
For completed properties or apartments, Purchaser should consult a lawyer before the Option Money is paid over to the Seller. The lawyer will then make a Title search with the Singapore Land Registry and confirm the following:-
(a) that the "Seller/s" is in fact the owner (or if the Option to Purchase is granted by his representative, then a valid and subsisting Power of Attorney must have been executed giving all necessary power to execute the same and a copy thereof must be registered with the Supreme Court of Singapore);
(b) the land area if the property is landed or the built in area in the case of an apartment or condominium (not the built-in area in the case of a landed property such as a bungalow or a terrace house);
(c) that the property is not encumbered (i.e. mortgaged to any bank or finance institution or subject to any charge and if so, the same to be discharged upon legal completion); and
(d) that all the terms and conditions of the sale and purchase are fair and reasonable.
What does the Sellers’ lawyers do during the period from the date of exercising the Option to Completion?
During this intervening 8 to 12 weeks, the sellers’ lawyers would:
1. Deliver the title deeds to the purchasers’ lawyers with a Schedule of Deeds (listing out the documents) on the usual undertaking.
2. Obtain from the vendor current bills of property tax, service and maintenance charges to apportion the amount which the purchaser has to pay.
3. Liaise with the management corporation.
4. Checking the Transfer
Check and approve the Transfer prepared by the purchaser’s lawyer. After the purchaser’s lawyer has prepared the Transfer, arrange for the vendor to sign.
5. Sending the completion account
Prepare the completion account and forward it to the purchaser’s lawyer. The completion account shows the total amount payable by the purchasers, after taking into account the deposit paid, and the apportionment of property tax, maintenance and service charges already paid by the vendor.
6. Arranging for completion
Arrange with the purchaser’s solicitor the completion of the transaction, particularly as regards the place and time, and the documents that the vendor will be handing over to the purchaser in exchange for the final balance of the sale price according to the completion account.
7. Attending to completion
a. Vendor’s lawyer
In exchange for the payment (cashier’s orders), hand over to the purchaser’s lawyer:
- the signed Transfer in favour of the purchaser, certificate of title, other title deeds if any, discharge of vendor’s mortgage, receipts for property tax and service and maintenance charges.
- a copy of the Notice of Transfer, and
- keys to the property.
b. Vendor’s mortgagee
If the vendor’s property is under a mortgage, then hand over the redemption money (usually from the sale proceeds payable by the purchaser who has previously been requested in the completion account to prepare for a cashier’s order for the vendor’s mortgagee).
c. Property Tax Department (Chief Assessor)
Send the Statutory Notice of Transfer to the Chief Assessor of the Property Tax Department notifying him of the change of ownership of the property sold with all required particulars of the sale and the Purchaser.
d. Management corporation - Notify the management corporation of the change of ownership of the property.
8. Reporting completion
- Report to vendor that the sale is completed and release all the funds to him less the legal costs.
- Notify various persons of change of address
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