GET SHORTY!

Short sale buying is one of the best options for home buyers looking to get the cheapest homes on the listing. But do note, dear buyer, that buying short sales may not be as easy as it seems.

See, short sale Malaysian homes are homes that are in danger of foreclosure. The slightest amount of carelessness and the smallest mistake may just cost you a huge, huge problem including having to assume a mortgage loan gone bad (nobody wants that)!

So arm yourself with knowledge and prudence before jumping into this quickie of a sale called short sale. Here are some of the most common mistakes home buyers make when trying to buy short sales:

  • Jumping in to the sale too soon. Okay, so I get the point of a short sale is to get the house sold as quickly as possible. And I get that, on your part as the buyer, you want things to get done as quickly and as cheaply as possible. But that does not mean you should blindly and carelessly swoop into a hasty decision without considering things – the papers, the current mortgage situation (most important), the current market value of the house, etc. Just because it’s cheap does not mean it’s a good buy, remember that!
  • Not getting a full assessment and inspection of the house. Considering that the owner of a house is kind of in deep financial rut, you might have to spend on home inspection yourself. After all, you will most benefit from it. You can use whatever you find out about the true structural condition of the house not only to get a sweeter deal on the house but also for your peace of mind – that you’re moving into a house that can protect you and your family through and through.
  • Offering too much just to get the house. With a house sold a bit too cheaply, the person who bids highest is likely to end up getting the house. But that may not be the wisest thing to do. Make sure that the price you’re willing to go for the house would be justified by the condition of the house as well as its other attributes. Buying it a little more than it’s offered would be a forfeiture of your original intention: getting the house cheaply.
  • Not consulting the mortgage lender. This is what makes the short sale crucial. A short sale is never fully final nor legal unless it has the full permission of the mortgage company that holds it. And if you buy the house without checking the status of the house paperwork and legality wise, you might be buying someone else’s trouble. So take that one extra step of talking to the mortgage lender about the house to be fully certain that you are entering into a deal that is clean and with no problems attached.
  • Not consulting a real estate professional. It may not be in your best interest to try to buy a short sale without an agent and without an attorney. Short sale homes have a little too many strings attached to them that you don’t want to make the slightest bit of mistake that could cost you a fortune.

You’re Making A Terrible, Terrible Mistake There Bucko!

NOTE: This article was first published in the Hartanah Malaysia magazine, December 2013 issue.

Along with the rising number of things that homemakers can do for themselves today as the DIY trend on practically everything continues to soar, there is also an increasing number of homeowners who decide to go DIY on their home sale. FSBO, or For Sale By Owner, supposedly presents tons of benefits for the Malaysian homeowner, the most dominant one being the fact that they won’t have to share the spoils with the real estate agent’s commission which can get quite a burden to some.

These homeowners brave all the responsibilities and demands of home selling and try to compete with the many professionals in the real estate market.

Buying a FSBO home or a unit from  does have its benefits for you, the buyer. For one, it is almost always easier to directly transact with the owner over having to go through a middle man (the real estate agent) for practically everything. The homeowner, after all, could make all the right decisions spot on; the agent would have to make a call to confirm, deny, etc. Another reason is the great possibility that a house sold FSBO is sold slightly lower than a house sold via an agent. After all, there’s no commission to worry about.

But while it may sound perfect enough, is it really the best way to buy a Malaysian house? These reasons might make you think otherwise about buying a FSBO house:

The homeowner may not be knowledgeable enough about a real estate sale. Selling a house may require more things than just selling the house itself. When it comes to the technical stuff, a regular homeowner may not exactly have adequate amounts of knowledge. This could be a problem if the papers, the mortgage, or some other technical thing gets complicated. Also, they may sell their house much higher than its fair market value. Some homeowners translate their love and emotional attachment to the house in its selling value, therefore putting a much higher asking price on the house than its actual value. It may become a big problem if they insist on it and negotiating would be a very, very difficult challenge.

Undertstand that they may exaggerate on the sales talk. Unless you’re dealing with a homeowner with a professional sales background experience, the FSBO seller might exaggerate on the sales pitch simply because they don’t know any better. This is not a problem until they try to sugarcoat the underlying problems of the house and you may never know about it until you come face-to-face with it. Finally, the whole process might take much, much longer. With their relative inexperience, they may not know the ins and outs of the whole real estate selling process. They don’t have liaisons or messengers to do the small paperwork; they even possibly have kids to take to school on a daily basis; and more importantly, they don’t have enough connections to shorten the whole process for them and so it just might take a while.

Buying a house, FSBO or not, is always a matter of weighing the odds. Weigh in on the good and the bad of FSBO buying, it may just be the thing for you…or not. Try to get a Real Estate Lawyer and ask these questions. Good luck.

Real Estate Lawyers Are Not All Despicable…

Apart from your real estate broker, there has got to be one other person who is the perfect example of ‘authority’ as far as real estate expertise is concerned and that is no one else other than your real estate lawyer.

Your Malaysian broker is the technical guy and your lawyer is, obviously, the legal guy. He is who you turn to make everything about your home selling or home purchase official in the eyes of the law, and more importantly, if it involves mainly the part about the money.

The Malaysia real estate lawyer, your real estate lawyer should definitely not be the last person you turn to in your every real estate decision-making process. He is not someone you put last on your schedule; you choose your lawyer around the same time you get your real estate agent. Why? Simply because you need him every step of the way and not just towards the end when you have to have papers signed by him. And because your real estate lawyer is an absolute and unquestionable authority in the subject, he sure has an answer to most every real estate law-related question. Here are some questions you should never forget to bring up to your lawyer when the great Q&A portion surfaces:

  1. How can I protect myself? This is, in my opinion, the most important question to get answers from. The thing is, you have to know how you can stay protected throughout the entire process of home selling or home buying. You have to know how you can protect yourself from every little thing and every single person you deal with through and through. And certainly, no one else but your real estate lawyer can make certain of that.
  2. Is there some other way to get this (enter condition) done? This is perhaps the real reason why you would be better off picking a lawyer yourself and not someone that your mortgage agent or your real estate agent picked for you. Pick someone with no biases and will definitely be on your side because should any of your agents suggest one thing, your real estate lawyer can tell you straight away of there is a better alternative for you.
  3. Have you ever had a case similar to mine? A lawyer’s expertise is best tested and built when he has gone through the same exact case as you do. And it would be best that you know how your lawyer handled it and on what your possible scenarios would be. That way, you can weigh your options and come up with a possible solution with your attorney.
  4. How soon can we get it done? In every real estate transaction, time is of the essence. And it would be best to know that you have your whole transaction planned and your time ‘budgeted’.
  5. What possible problems can come from this?  Prevention is better than cure, so a good foresight of what possible problems can arise from your current transaction can really help you dodge them.

If you need a good lawyer, call Kwabena Pratt at 013-2019928 and say that Marson asked you to call!

Turning Away Help…

keys to your condo

IMAGE CREDIT: John Soh

I know I will get lots of hate mail from agents but I am going to publish this anyhow! ;)

Selling your Malaysian condo on your own and unaided by a real estate agent is in a lot of ways different from selling your home on your own. And yet, in so many ways too, selling your condo FSBO (For Sale By Owner) are practically one and the same.

The biggest difference lies mostly in the fact that selling your condo means having to sell the entire complex. It’s not about selling your front yardage; it’s not about selling a house that’s different from your neighbors – heck, you have to sell them something that looks practically like everything else within the building. It’s about selling what the entire complex offers, selling the charm that is city living, and practically convincing them that they’re better off having to pay monthly repair and maintenance fees and not getting the chance to do whatever they want with their unit.

for sale by the owner

IMAGE CREDIT: Mohd Jamal Bin Aziz, CPA

So, how do you effectively sell your condo without having to share your goods with a real estate agent?  Here are some tips:

  1. Market your condo the way it was marketed to you. There’s no better nor easier way to market your condo other than the way the real estate developer marketed it to you. The truth is, your unit does not hold anything special against your next door neighbors. Unless you have the penthouse unit, you unit is a complete copy of the one next to it. So why make an extra effort on marketing it any other way? That saves you time and money.
  2. Get it listed. Some sites that you may want to consider are: STProperty, KLCCcondominiums.com.my, Thai Property. Others are not so good.
  3. Don’t stress too much on ad presentation. You don’t have to have a hundred thousand photos of your unit taken; just one or two actual photos of your place will do. Grab one from your real estate developer and voila! You already have everything you need to market your place, including actual sizes! Everything else that your potential buyers would need are on the condo complex anyway so grab away (with permission and proper credits of course).
  4. Get your ads to focus on the perks of living in a Malaysian condo. That’s what condo buyers are looking for: what is in your condo complex that would make them want to buy it? So go ahead and market the rest of the complex – pool, sauna, regular maintenance (this is really essential since this would tell them how well maintained your place is), nursery services, etc – these will make it seem like the place is actually worth all the actual extra price of it.
  5. Focus on the good stuff about the area. People live in condos mainly because they want the comforts of living close to the city; so by all means take a photo of the city view from your bedroom, the close proximity between your condo and the supermarket and the kindergarten, etc.
  6. Get all the necessary papers for you to fully move out of the complex. There are potentially more things and more papers to consider and work on when you’re trying to let go of your condo than when you do with a house. There’s always the homeowners’ association for instance! And as with everything else, you have to make sure that all the financially related papers would be good and ready to go to avoid all hassles.

I know I will get lots of hate mail from agents but who cares? ;)

The First Time

The first time I looked into your eyes I cried. -SURFACE

Buying a house for the first time is one of the biggest, most important milestones in any person’s adult life. And because of the gravity of it, not to mention the price it comes in, buying a house is something crucial as a financial move as well.

This is overwhelming to second- or third-time Malaysian buyers. And you can only imagine how much more overwhelming and stressful it is for the first time homebuyer – especially the part about mortgage. All the papers, the technical stuff, and everything else in between can drive you really crazy! Everything seems expensive and legal and can get you a lawsuit if you do something wrong about it. After all, you’re strapping yourself to at least 10 years of enormous debt!

So to defeat the overpowering mortgage jitters, here are some important first-time tips on mortgage and home buying:

  • Hire the services of a good Malaysian real estate lawyer. You’re bound to need one towards the end anyway so invest in one early on. This would save you from all the troubles of signing the wrong contract and other similar problems. Plus they can give you some good advice on the rest of the financial and legal aspects of the purchase all the way towards the end. For tips on how to deal with property lawyers, click here.
  • Have a bank account and have all your other assets well accounted for. This will serve as proof of your capacity to pay for your home. While this isn’t a top priority, it would give your lenders a boost of confidence about your financial readiness to take on a responsibility as big as a mortgage.
  • Clean off your credit records. This is one of the first things that your mortgage agent will look into the moment you apply for your mortgage. So take that extra measure of making sure that you have a clean credit record. Do not hesitate about taking that side trip to the creditors and apply for whatever program they have on cleaning up records. That would be more than worth it when you get a smoother mortgage loan approval.
  • Do your homework. In this day and age, there’s really no excuse for not knowing beforehand what you’re getting yourself into. Always only buy what you can afford, and equally as important, also get good valuation for your property. Use a site like PropertyReviews in order to get past transacted prices in order for you to compute the fair market value of the property you want to buy.
  • Don’t go to a single mortgage lender. There are tons of mortgage lenders around and it would be such a waste to just jump right into the first one that you find just because you’re too lazy to check out the others. Each one has a different offer from the others so you might definitely want to find out about that. Shop around and ask as many questions as you want until you find one that you’re fully comfortable with.
  • Use a good property site. My personal favourites are GoodPlace.my (http://goodplace.my/) and Knight Frank (http://www.knightfrank.com.my)/
  • Have your down payment money ready. While you don’t need it yet until you make a final offer, you may need it to let your lender know that you are indeed serious about buying a house and that you’re not just wasting their time. This will also help them better figure out how much of a house you can truly afford.
  • Ask as many questions as you can. Don’t let the mortgage agent intimidate you. Ask about anything that you don’t understand about because that is your right.
  • Lastly, don’t forget to get a pre-approval. This will make your house hunting trip more specific and you won’t be wasting yours or anyone else’s time on looking at houses that your mortgage loan won’t afford anyway. Good luck!

PS: Also see these articles which you may find useful – here and here. :)