Getting Loan Approved, Handing over the Keys

GETTING LOAN APPROVED

Time was running out, Venessa from Affin didn’t help. 

We signed the SPA at the end of June and now its the end of August 2016. Time was running.

But,Citi Bank with Wifeys application, luck had changed for the better. I received an exciting call from her while at work saying "We got a loan approval !" I was so happy I screamed. I asked her
over the phone how much was the interest, was a  bit more but was okay with me. We had a home loan approved ! After all the stress building up and getting rejected, the tides had finally changed and we were now getting to an Awesome state.

The pressure came off the shoulders and things felt good. By this time, it was in the 3rd week of August, coming up to 2 months running into the SPA. The banks would take another month to sort things out too. So we were running very close the the SPA's expiry.

Citi Bank had a nice way of doing business. They looked at our documents, and moved forward quicker than any other bank. I didnt have to submit any additional stupid documents, no site visit by them either. No need for images of my work place, or why my payments didnt come in occasionally on time.

They moved forward first with our documents, and while waiting for a formal Loan Approval Letter they also gave us this 1 AND ONLY form to sign. The rest was filled by them. This was to select the prefered lawyers we would like from Citi Bank for our loan approval documents. Now this was ease and comfort of moving forward.

They meant business, and so did we. No bullshit. We had a firm answer and a quick one. No filling up of 5 pages of forms and shit here that asks whats your EPF contribution every month, your salary, etc like the other banks.

 

The only Citibank Document we had to Fill Up and Sign

This was the document that we signed to select our preferred banks lawyers for the signing of the loan approval documents in the week or so that followed. I truly liked how they moved forward first while awaiting for the Loan Approval Letter to come out. This is how business ought to be. 1 page, not 5 like Affin or Public Bank. We sign, the bank does the rest. Thats how customers ought to be treated. 

Citi Bank came to our aid with an offer letter of 899,000. Which of course was way lower than what we expected for a 90% Home Loan. 

Why ?

Because Citi Bank is Global. It consolidates its losses with its other countries it invests in. 

So why didn’t HSBC work out ? Well HSBC is as it turns, may be on its way out from Malaysia.
But Lowyatt folks already knew that right ?

In a time of crisis, DEAL with International Banks. International Banks will invest in property for bad times and make money. Local banks do this when times are good.

Shallow thinking before, clear and aware now.

Did you get a 90% loan ?

NO.

Because they don’t have to follow local rules. So kudos Citi Bank and the Wifey !

However Citi Bank, your loan though was heaven sent, gave us thought.

A loan offer was made at 890,000 on our 1.33 Million property. Which was lower than our interest of 90% margin of financing offered by MO1's banks. To this, the loan repayments would have costed us a whopping 4,500.00 a month. Which was basically saying, we stab you with many small cuts till you  have a slow and painful death. Which I could not accept.

While my wife was very excited and things were hot on the plate. I simply could not stomach the fact that 4,500 a month would be a detriment to our savings in the future and having to live modestly. Its 2017 and times are tougher, a lot can be done with 4,500.00

She too encouraged to take the loan offer and be done with it. Perhaps she too was feeling that time was running out and it was now or never. However, having some Vodka that night I had to say that the repayments were way too high at RM 4,500.00 a month.

And if the banks were going to stab us at this kind of interest, we had to stab back too. So we decided that a RM 700,000 loan would be what we will need. This was all discussed in a matter of probably half an hour and letting the wife sink in that the loan amount had to now have a bigger "differential sum" in order for us to live more comfortably within our means for the future. 

In the end, what will 3,500.00 be valued at in 5 years compared to 4,500.00. We will be getting out of a strain faster at 3,500.00 than 4,500.00 a month. If banks would like to drain you because that is how they make money, then dont let them win. 

Its better to loose in the short run and recover in the long run. Never let banks screw you. Its either you get what you are promised, or you offer what you want.

Banks, as mentioned, rely on us, we should not rely on them. Never feel thankful to a bank, money comes to them, they never look for you. Its like a customer walking straight to your doorstep without having to knock on doors to find one. Be the customer. Know what your value is. 

We dont need to eat steak everyday like lowyatt folks who claim they eat modest chicken rice everyday like me. Perhaps once every 2 weeks a steak or a nice dinner will be fine. And with 4,500.00 a month, thats a lot of money and we cant even have steak once a month.

So after a hard discussion over some Vodka, I laid it out that its stupid to be repaying that kind of money on a Single Storey. And we agreed that we will make a counter offer knowing well we will pay an ever greater differential sum to the Seller.

So the wife made a phone call and said "Thank you very much, but what we want is RM 700,000.00 for a Home Loan"

Even our Lawyers got a shock. Thats almost half the house, paid in cash. Were we broke ? Yes. 

Here is the letter we had then had to send to the Seller. We contacted the property agent and our Lawyer and forwarded this letter. The Seller told us to send this letter to our lawyers as well. You can imagine the shock of the lawyers.

We paid in the end RM 633,000 in cash, for our first home. Is that what you call being fair to a first time home buyer ? We had to borrow to get these funds as well. Talk about property and bank websites offering 90% Margin for Home Loans ? Balls. Happens in lowyatt world though and online property websites and bank websites. This is the real world. This is Malaysia. This is the truth that no one wants to hear.

Look folks, if the banks want to squeeze your balls, ensure that they are going to loose too. It can only be a win-win. Or everyone looses. 

Can you imagine the kind of investments we could have made ? We could have been lowyatt folks too. We could have put in a downpayment for another 2 apartments as an Investment. But this is our Home.

The tone of the Home Loan agent had changed. And although cheap tactics such as "We will need to redraw the home loan offer amount and could take another 10 working days...." was mentioned, its still better than moving on with life with 4,500.00 monthly. I knew as well that time was running out and so we wrote a bold statement to our lawyer saying 

We will pay a differential sum of 449,000 now, and in return, we are awaiting for the banks to approve our loan as times are tough. So please do not charge us if its beyond 3 months after the SPA's expiry date.

I know lowyatt folks, its fart in the wind with their 10 properties that they own. Because they are rich, but not me. That money did not grow on trees. We saved and borrowed and when you are in this deep of shit, desperate measures had to be taken. 

So finally, after a week, the Loan Offer was redrawn, the Home Loan Agent didnt get a bigger greedier cut than she was expecting and what happens next ? You sign the loan documents.

August 29th 2016. 2 months after SPA, and telling the banks to change to loan amount, we had our loan offer letter ready. We now had to chase for the banks to get the Loan Approval Document ready. We had to tell our lawyers as well, that we had received the offer and were now waiting for the banks to get back to us with the "Facility Agreement" document we needed to sign to then disburse the loan to the Seller. Stressful times.

Here are questions you may have :

Where do I sign the loan documents ? :

You will head to EITHER the Home Loan Branch where the Banks lawyers will be waiting for you

OR

The banks Lawyers office 

What happens there ?

You will submit your IC and then be given a Wet Gel pen to sign a shit load of pages for your Loan Approval Document. In this case Facility Agreement as shown below. Its like applying for a car loan.
Its something like 100 pages or so. You will do a lot of flipping of pages and signing on them.

Documents signed, we then sent an image immediately to our lawyer to tell the Sellers Lawyer that some money will be coming in soon to the Seller. This was to ensure the Seller we have our loan sorted and were ready now to pick the keys soon. Do this immediately upon signing

What do I do after I have signed the loan documents ?

Take a picture of the front page, back page, and a couple of pages where you have signed the loan documents, send this immediately to your Lawyer

Why ?

So you can collect your keys. This is important as well so that your lawyer and the Sellers lawyer now know that the loan has been approved, and to ensure that things are running well. So the Seller now just has to wait for the money.

What happens now ?

1. You wait for Your Lawyer and the Banks Lawyer and the Sellers Lawyer to make arrangements for disbursing the funds to the Seller of the property.


2.This is where KTN 16A (Kanun Tanah) needs to be produced. Not KTN 14A, but KTN 16A which basically is your Title of the property belonging now to YOU. This will be another trip to the Land Office by your lawyer. where the Title of the property will have your spouses name.

30th September 2016. Just 3 months after signing the SPA, the KTN 16A was produced. This is

KTN 16A. This is where your title of the property says you are the owner of the property at the Land Office. Congratulations, you have now gone through a name change. Now you will pay for Cukai Tanah as well. You will need a Certified True Copy by the Banks Lawyers. Ask for this fast. You will need it for your EPF withdrawal as well.

3. Your GERAN / Grant will also need to be produced. This will also happen at the Land Office. The Grant will mention that the land belongs to YOU and the Banks in our case Citi Bank.

The front page of your Grant

The grant clearly mentioning our names with the Banks as well

The originals for the Geran and KTN 16A will be kept by the Banks till you one day settle off your loan. The Geran / Grant, just like your car, will be given to you after / sometime when you have paid more than a decent share of the property, usually exceeding the 60% mark.

How long will this take ?

Between 2 to 3 weeks.

What do I do meantime ?

Set an intended date for collecting your keys

Who will give me the keys ?

Unlike in the States, its customary for the Seller and the Buyer to meet when handing over the Keys to the owner. In Malaysia, your lawyer will collect it for you and will hand it to you when all money has been disbursed to the Seller. 

HANDING OVER THE KEYS FINALLY

Your lawyer will meet you at your new Home, where he will hand over the keys to you on a nice Sunny afternoon, and when you open the gates, he will ruin shit that has been playing in your head since the time you had a faint memory of "what will it be like one day getting the keys to my Home ?"by being probably the first person to step into your Home. This happened on the 13th of October 2016. I couldnt help but laugh when moments like this, Husband and Wife, trying to soak in a moment, get ruined by a lawyer who possibly has no thought or regard of First Time Home buyers appreciating their hard earned effort of owning their first property, their first Home.

Well Congratulations, this is how you own a Home in Malaysia

If you have been reading this so far, Theres a new Saga that will be coming up and it will involve Renovations. This will be even more extensive than getting a Home Loan.

But before that, a post getting your keys of things in the home and paper work you will need to do when you have bought your Home.

Theres some annoying paper work that needs to be done, while nothing great but its important to get your Home in order first.