Malaysia Property Progressive Payment Schedule

What is the progressive payment schedule for buying a new property under construction in Malaysia?

property-construction-r

 

The Housing Development Act (HDA) 1966 was updated with Housing Development Amendment Act (HDAA) 2012 that came into effect on June 1, 2015.

 

Details of the breakdown for progressive payment for Schedule G & H are as below:-

Schedule G is for landed residential while Schedule H is for strata residential.

There is no schedule for commercial properties thus less protection for buyers.

 

SCHEDULE OF PAYMENT OF PURCHASE PRICE

Instalments Payable % Amount
1. Immediately upon the signing of this Agreement 10 RM
2. Within twenty one (21) working days after receipt by the Purchaser of the Vendor’s written notice of the completion of:-
(a) the work below ground level including piling and foundation of the said Building comprising the said Parcel 10 RM
(b) the reinforced concrete framework and floor slab of the said Parcel 15 RM
(c) the walls of the said Parcel with door and window frames placed in position 10 RM
(d) the roofing/ceiling,electrical wiring, plumbing (without fittings), gas piping (if any)and internal telephone trunking and cabling to the said Parcel 10 RM
(e) the internal and external plastering of the said Parcel 10 RM
(f) the sewerage works serving the said Building 5 RM
(g) the drains serving the said Building 5 RM
(h) the roads serving the said Building 5 RM
3. On the date the Purchaser takes possession of the said Parcel with water and electricity supply ready for connection to the said Parcel 12.5 RM
4. Within twenty-one (21)working days after receipt by the Purchaser of the written confirmation of the Vendor ‘s submission to and acceptance by the Appropriate Authority of the application for subdivision of the said Building 2.5 RM
5. On the date the Purchaser takes vacant possession of the said Parcel as in item 3 and to be held by the Vendor ‘s solicitor as stakeholder for payment to the Vendor as follows – 5 RM
(a) two point five per centum (2.5%)at the expiry of six (6)months after the date the Purchaser takes vacant possession of the said Parcel RM
(b) two point five per centum (2.5%)at the expiry of eighteen (18)months after the date the Purchaser takes vacant possession of the said Parcel RM
TOTAL 100 RM

 

Monthly Instalment Interest Calculation

RM400,000 at 90% loan rate at 4.40% for first 10% released in month with 30 days

400,000 x 10% x 4.40% x 30 / 365 = 144.65

Examples of Monthly Instalment

1m at 90% loan rate at 4.30%

 

600k at 90% loan rate at 4.35%

400k at 90% loan rate at 4.40%

 

LAD Late Delivery Payment to Housebuyers

Liquidated Ascertained Damages payable to housebuyers for lateness is delivering of vacant possession in 24 months (landed) or 36 months (strata) calculated 3 years from date in S&P.

LAD: 10% per annum on purchase price for period of delay

Note: Complaint must be submitted within 12 months from CCC

Caution: Do NOT sign any documents that waive your rights to LAD which have been practised by certain unscrupulous developers.

If you face difficulties getting your keys, contact the Housing Tribunal (TPPS)

 

What Developers are No Longer Allowed to Promise Housebuyers

  • Developer Interest Bearing Scheme (DIBS)
  • Free legal fees
  • Projected monetary returns/gains/rentals
  • Claim panoramic views
  • Travel time to nearby destinations
  • Other information developer cannot genuinely lay proper claim

 

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5 thoughts on “Malaysia Property Progressive Payment Schedule

  • August 14, 2017 at 1:02 pm
    Permalink

    Hi
    Just wanna ask..if there is a rebate 13% or 15% . Means 9% when SPA, 2% on stage 2A and 1% on VP. Does it means that i only have to fork out just 1% right?

    Hi Fizy, It depends on the seller for the rebate timing. But yes based on the rebate schedule you provided, it appears you only need to pay 1% (10%-1%) upfront. (Excluding legal/misc fees if applicable)

    Reply
  • December 26, 2017 at 7:53 pm
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    Hi, referring to your given example eof monthly repayment for “400k at 90% loan rate at 4.3% interest”, can you explain how the “monthly installment amount” being calculated?? Let say during the “Pilling & Foundation” stage, buyer needs to start paying 4.3% interest of the 10% loan (or RM40,000), which should be RM172/month right? May I know the calculation method you use to get RM197?

    Hi BiliBala Seng, Thanks for the query. The previous illustration was a monthly installment for interest + capital payment. We have updated the illustrations to be clearer and more up-to-date, and a new section on monthly installment interest calculation.

    Reply
  • January 3, 2018 at 1:18 pm
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    Hi,
    Will the interest paid during the constuction period be deducted from overall interest amount imposed during loan tenure?

    Hi Faiz, the interest paid will be on the amount of loan disbursed. In a sense, the interest you are paying is part of the overall interest amount due. However, it does not reduce the interest that you will need to pay for the entire property loan based on an amortization table.

    Reply
  • January 10, 2018 at 9:36 am
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    Hi,
    If the developer failed to deliver the unit on the stated period (36months), what should the buyer do?
    How is the 10% per annum on purchase price calculated, if let’s say the unit priced at 400k?
    And do the buyer still need to serve the interest? What about the monthly installment?

    Hi Natrah, Buyer should contact the developer for liquidated and ascertained damages (LAD) payment. 10% of 400k per annum would be 40k per year (pro-rated for period less than 1 year). The buyer will still need to pay interest and monthly installments as this would be the buyer’s obligation with the financier.

    Reply
  • February 28, 2018 at 12:03 pm
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    LAD Late Delivery Payment to Housebuyers
    Liquidated Ascertained Damages payable to housebuyers for lateness is delivering of vacant possession in 24 months (landed) or 36 months (strata) calculated 3 years from date in S&P.

    LAD: 10% per annum on purchase price for period of delay

    I plan to buy a small unit service apartment in Subang. The developer claims that government has extend VC to 48 months. Is this true? If this is false information, is it meaning the developer cheated on us? So we can proceed for LAD claim if they delay after 36months, right?

    Hi Penny, the High Court has in the past made a decision to set aside the order by the urban wellbeing, housing and local government minister to give a 12-month extension to a developer. You may want to seek legal remedy for the extension.

    http://www.freemalaysiatoday.com/category/nation/2017/02/28/delays-are-developerss-responsibility-says-rehda/

    Reply

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