Home Purchase Procedure

What process is involved with buying a property?

Buying a Property under Construction

Steps (Days required) Procedure
Step 1
  • Choose a desirable property.

 Step 2
(3 - 14 Days)

  • Sign the Preliminary Sales & Purchase
    Agreement and pay the initial deposit.
  • Apply for a mortgage loan from a bank, get property valuation and choose a solicitor.

 Step 3
(30 - 60 Days)

  • Sign the Formal Sales & Purchase Agreement at solicitor's office and pay the deposit and stamp duty.
  • Approval from bank on mortgage loan application.

Step 4

  • Sign the Equitable Mortgage Agreement, Trust Deed and other legal documents at the solicitor's office; pay the balance of the property value, solicitor's fees and other related expenses.
  • Drawdown of approved bank loan amount to pay part of the property price.

 Step 5
(Note the construction progress)

  • Prompt settlement of loan repayment by instalments or sale of property for repayment.

Step 6
(14 - 30 Days)

  • Receive occupancy permit.
  • Sign all official documents, including the Formal Sales & Purchase Agreement at solicitor's office, settle related expenses, check the property and move in.

 

Buying a Completed Property

Steps(Days required) Procedure
 Step1
  • Choose a desirable property.

 Step2
(7 - 14 Days)

  • Sign the Preliminary Sales & Purchase
    Agreement and pay the initial deposit.
  • Apply for a mortgage loan from a bank, get property valuation and choose a solicitor.

 Step 3
(30 - 60 Days)

  • Sign the Formal Sales & Purchase Agreement at solicitor's office and pay the deposit and stamp duty.
  • Approval from bank on mortgage loan application.
Step 4
  • Sign the Assignment, Mortgage Agreement, Trust Deed and other legal documents at the solicitor's office; pay the solicitor's fees, pay the balance of the property value and other related expenses.
  • Drawdown of approved bank loan amount to pay part of the property price.
Step 5
  • Take over the property and move in.
  • Prompt settlement of loan repayment by instalments or sale of property for repayment.

FAQs

The following are answers to some frequently asked questions that you may find useful when purchasing your own home.
 

If I have found a suitable unit, how much do I have to pay for the first instalment? 
It all depends on your income and how much you can afford to spend on your property. Generally speaking, your first down-payment is 40% of the property value, with the balance of 60% to be settled by bank loan. If you want to pay less for down-payment, you can apply to the mortgage insurance company for a 90% mortgage loan guarantee.
Other than privately-owned properties, do I have other housing schemes to choose from?
Yes. There are public housing schemes subsidised by the government such as the Home Ownership Scheme and the Tenants Purchase Scheme, etc. Please note that each Scheme has its own specific application requirements.
Apart from the down-payment, what are the other expenses involved?
You should take into account the related expenses which include the real estate agent's commission, solicitor's fees (including sales & purchase agreement, transfer deed and mortgage agreement), stamp duty as well as search and registration fees charged by the Land Registry.
If I want to get a mortgage loan from a bank, what kind of properties would be more acceptable or preferred by the bank?
The age of the property and its quality are the two major factors a bank considers when granting a mortgage loan. A more conservative attitude would be adopted towards older buildings. Therefore it would be more desirable to choose new, well-managed and well-maintained properties.
There are so many repayment alternatives provided by banks. How do I know which one best fits my requirements?
Apart from considering your own financial position, you should also find out the various repayment alternatives available in the market before making your decision. For example, repayments can be made on monthly or bi-weekly basis, with fixed amount and fixed or variable tenure.
What kind of documents should I submit to apply for a mortgage loan from a bank?
You should bring along the preliminary or formal sales and purchase agreement, your identity card, and the original copy of your income proof (including income tax statement, salary statement and bank statement). For corporate applicants, you should also submit the business registration certificate, company registration certificate, list of directors and the company's memorandum and articles of association.
Will the bank accept guarantors for a mortgage loan?
Generally speaking, most banks do accept a guarantor nominated by the applicant. For an individual applicant, the said guarantor must be directly related to the applicant. The identity card of the guarantor and his/her financial proof must also be presented.