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Buying a home? Here’s where you know all your COSTS.

Posted in Investment Resources, Personal Finance, and Starting Property Investing

A good friend was buying a home for the very first time, after many rounds of discussion with me. Well, at least 3 mamak sessions. His wife is a medical officer and I would think must be the one who’s also pressuring him. Haha. Speaking of loan applications, he applied for three banks and all three approved him. See, it’s not hard to get it approved. Just make sure our CCRIS is pretty clean. He drives a VW Passat by the way. Somehow, all my friends drive better cars than me. Perhaps that’s why I bought my first property when I was 26? I think after that first property, I was forever ‘poor’ and could no longer allocate much for a car. One day, I will buy that Audi… (ONE DAY…) He was asking me many questions about the loan, the legal fees, stamp duty and even the tenure. I told him that these days, the banks are pretty competitive and he should just take the one with the lowest Effective Rate.

As for all the other questions, well, I found www.propertypricetag.com‘s fee calculator. Click here. Basically, it’s simply entering the house price and well, everything is calculated automatically. We can choose whether we are a buyer or a seller. Take a look at what happens when we enter the house price as RM400,000 and a downpayment of 10 percent. The calculator tells us that we MUST get ready RM63,405 if we intend to buy a RM400,000 home. In other words, instead of just the RM40,000 downpayment, we need another RM23,405 for all the rest; stamp duty, legal fees, other fees and valuation fees. By the way, this does not yet include the renovation fee which would usually be between 10-15 percent of the home price. Please try not to spend too high because when you sell your home, no one is going to pay in full for your renovation costs yeah.

So, what happens if we are not a buyer but we are the seller then? Hey, it’s as easy as a simple click to change from buyer to seller. If we are a seller and the price of the property is RM400,000, we need to pay as per the screen showed; RM6,245. Yeah, that’s one key reason why no one sells the home they bought at the same price. Usually they will sell higher. 😛  Can we save even more on the legal fee? Yes, if we did not appoint our own lawyer but uses the buyer’s lawyer instead. Be reminded that usually nothing bad may happen but the lawyer is on the buyer’s side yeah. So, they will work for the buyer while for your side, perhaps they are just an admin to you. I personally would still appoint my own lawyer even if I am the seller. Just kiasu mentality lah. Hope this will help all of us in our many questions about calculation of fees. Happy using it. The link for reference again, here. Thank you yeah propertypricetag.com (They did not pay any fee for this review. Perhaps if I drop by their office, they may treat me a cup of coffee. Haha.)

written on LABOURS DAY 2018

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