You’ve been scrimping and saving to buy your first property, and now they tell you you have to pay a few thousand dollars for a lawyer? What lunacy is this?
Unfortunately, lawyers are a necessary evil when it comes to property transactions. So, does your lawyer immediately skip off to the golf course once you pay him? Not all the time. Here’s what he really does.
1. Protects your rights
When you purchase a property, you’re not really buying it in the same way you buy a copy of The New Paper at 7-11. The seller can’t just hand you your new apartment in a plastic bag and send you merrily on your way.
What you’re really buying are the rights to a property that stays right where it is. And let me ask you… can you tell me with certainty exactly what those rights are? Exactly.
What are your rights if you’ve moved in to a newly built condo only to have the toilet bowl split apart? What happens if your surveyor tells you the property is actually 20% smaller than you thought, but you’ve already paid the deposit? What happens if all the banks reject your home loan applications?
In general, nobody likes to talk to lawyers until bad things happen. Then they’re suddenly your new best friend and shoulder to cry on.
Your lawyer’s job is to look out for you and make sure nobody tries to infringe your rights even if you have no idea what they are in the first place. And his abrasive personality actually becomes a plus point when he’s pitted against your enemies.
2. Vets your documents
No matter now closely you read every document you’re given, it’s unlikely you’ll be able to spot all of the important issues, including mistakes and unfavourable clauses that should be changed.
Even if you got an A in literature, reviewing contracts is something else altogether, other than being more boring, that is. Even lawyers themselves take a while before they are proficient, simply because there’s so much that you can only know through experience.
The amount of paperwork involved in a property transaction is huge, from your option to purchase and sale and purchase agreement to your letter of offer and mortgage documents.
Then there are the instruments to be lodged with the SLA and arrangements to be made with IRAS.
And your long-suffering lawyer has to make sure all these tedious documents are accurate and in order.
3. Liaises with everyone involved in the transaction
From the day you first show up at your lawyer’s office with your option to purchase to the day you collect your keys, a lot goes on behind the scenes. In fact, it’s an administrative nightmare.
Property purchases involve an insane amount of paperwork, and in the lead up to the completion of your purchase, your lawyer and his secretary will be writing stacks of of letters to the seller’s lawyers, chasing them for stacks of documents, calculating how much you need to pay down to the last cent when property tax and MCST fees are taken into consideration and basically just wasting a lot of paper.
In addition, calls will have to be made to various parties to chase them for various items. Your lawyer or his secretary will have to call and nag your banker, the seller’s lawyers and even your property agent.
4. Monitors your property as it is being built
If you’re buying a property that’s still being built, you might get to relax in your current home without a care in the world until it’s ready, but that’s not the case for the construction workers slaving away to build it, or for your lawyer.
In the interim, your lawyer will be holding on to your documents and monitoring the progress of your property. He will be the first to know when you have to pay for another installment, and it is he who will be liaising with the bank you’ve borrowed money from to release the money on time.
Just as your doctor is the going to be the first one to see your newborn child, your lawyer is going to be the first to tell you the keys to your long-awaited property are ready for collection.
5. Ensures you don’t make any costly mistakes
While your lawyer is going to take care of almost everything for you, that doesn’t mean you can just take off on a year-long vacation and retire your Singapore phone number indefinitely.
Your cooperation is needed to ensure you don’t make yourself lose money, and your lawyer will hound the living daylights out of you until you comply.
So you can bet that when payment of the purchase price is due, you’re going to be receiving many calls from an annoyed secretary hassling you to bring the cashier’s orders down to the office immediately.
I guarantee you won’t be looking forward to calls from your lawyer’s office, but believe me, when they call you it’s usually for your own good.
Do you have any experiences with property lawyers to share? Let us know in the comments!
Read more here: http://blog.moneysmart.sg/property/lawyer-actually-buy-property/