Technically, it’s not a must to have a lawyer when you want to purchase a home in Malaysia. Everything about conveyancing is already spelt out clearly in the National Land Code 1965, Stamp Act 1949, Housing Development (Control and Licensing) Act 1966, Strata Titles Act 1985, Banking and Financial Institutions Act 1989 as well as the Contract Act 1950.
Just by referring to the legal Acts above, you’ll be able to draft your very own SPA in no time! Also, there are runners who can do the conveyancing work for you, with a fee of course, which is usually less than that of a professional’s. So, why would anyone want to hire a lawyer? Well, you might want to consider the following (very good) reasons…
1) You get professional assurance
When it comes to conveyancing, lawyers are bound by the Legal Profession Act 1974, while runners are obviously not. So hiring one in the early stages of purchasing a property will give you an edge in negotiations as they are obliged to do everything in the best interests of their client every step of the way.
Rather than guessing what’s next, you can also be assured that there’ll be no shady deals going on as a lawyer is subject to disciplinary action if they breach any rules. The legal body governing lawyers in West Malaysia is the Malaysian Bar, whereas for Sabah and Sarawak, it’s the Sabah Law Association and the Advocates’ Association of Sarawak respectively.
So it’s safe to say that a lawyer will do his/her utmost best to protect you against any unforeseen legal circumstances and advise you on your best way out if things suddenly don’t go to plan. This would enable you to quickly reassess the situation and explore other available options.
2) Ensuring the documentation is in order
It’s common for property buyers, especially first timers, to become overwhelmed by the sheer number of documents they need to complete and submit before the deal can be closed. Some of these include the SPA, housing loan, title deed, insurance application, and personal documentation.
A lawyer is one who’s had years of experience in dealing with these crucial paperwork (and sometimes more), so he/she is the best person to guide you to ensure you didn’t accidentally miss one or two that could delay the whole process. The worst case scenario is if you filled in the wrong details on your own and cause a pricey legal battle down the road.
A delay alone could already prove to be costly to you as a buyer, since the seller may have a change of heart/mind and decide to negotiate for better terms with another potential buyer just waiting for the chance to strike!
3) Explaining the procedure and jargons
The same mindset cannot be applied to the documents related to a property transaction in case there are missing information or fine print in there that will create massive problems for you in the future. “Liens or encumbrances”? “Caveats, covenants or easements”? If all these sound like some sorta mumbo-jumbo to you, they’re just examples of complicated legal words that you’re gonna need help with.
This is where having a property lawyer by your side REALLY comes in handy to explain everything. And since you’re paying for the services, you’re also allowed to ask anything and everything that concerns you before you sign on the dotted line.
4) Dealing with third parties
Buying from sellers/brokers in the secondary market can be a terribly confusing experience, more so to newbies. You might not be able to tell if someone is really offering you a good deal or you’re just being taken for a ride. Won't you need all the help you can get?
A lawyer will be able to advise you on the do’s and don’ts when dealing with any potential seller, as well as run a background search on your dream property to check if there are any outstanding legal restrictions. This will ensure you aren’t taken advantage of by dishonest individuals out to make a quick buck, such as those who demand an upfront payment without any proper documentation.
5) Planning for your will and trust
There’s a saying which goes – “The only thing certain in life are death and taxes”. Although it can be an unpleasant experience to plan for your death, this is a vital step to protect your loved ones from further pain. We’re talking about the possibility of fighting over your assets – especially your property – when you’re gone.
Even though you might decide to write your own will, you may not be familiar with some of the legal requirements and technicalities to create a concrete one. For example, how many witnesses would you need to make the will a legal and binding document? Are there any specific formats in writing a will? What are the implications of any outstanding loans or taxes related to the property? What information is mandatory to be included in the will?
The transfer of properties after one’s death can quickly become a complex and prolonged issue, especially if it’s a battle between your spouse and children. Engaging a lawyer in advance would at least ease this difficult phase for your family when the time eventually comes.
While it might be cheaper to DIY the purchasing process…
It’s not necessarily the most effective and guaranteed way to seal the deal. Unless you’re willing to take the risk of losing all your money and the efforts you poured into securing your dream home, it’s best to take up the professional services of someone who has the qualifications to ensure you emerge a satisfied homeowner.
If you want to know if you're ready for the leap (financially), check out Loanstreet's home loan eligibility report to determine whether you can get your finances approved.
This article was repurposed from "5 things a lawyer can do for you when purchasing a house", first published on iProperty.com.my