Financing your villa
purchase in Malaysia must be a priority when deciding to buy a property
for sale. Whether you are paying for your villa in cash or taking
out a mortgage we can advise you on the pros and cons of the various
options. You will need to consider a range of questions before buying
your property. We will guide you through all stages of organising
your mortgage and finance.
Tropical Cluster Village Q&A’s
1 Is there a bank guarantee?
There is no bank guarantee needed as the development is a third
owned by the State Government so the money is safe as there’s
not much chance of the Government going bankrupt.
2 Do you get title deeds as it’s a 99 year lease?
Yes, clients will receive individual Strata Titles upon completion
3 Are the lawyers English speaking?
Yes they are
4 Who are the likely rental clients?
Mainly locals from KL as this is the nearest coastline to the city
and is already a recognised area for weekend breaks, the State of
Selangor has a population of 7.2 million so this project will not
be dependent on foreign tourism although foreign tourism will be
targeted with regards to marketing the resort
5 Who will manage phase 2?
Tropical Cluster will be managed by either Swiss BelHotel International
(who are signed to manage phase 1) or an alternative large group.
Talks are currently being held.
6 What is the likely rental returns?
Please use phase 1 as a guide eg) a yield of between 8-10%. Please
note phase 2 offers the first 2 years guaranteed at 8% net, the
following years are based on a rental pool share of 70/30.
7 What is the buying process?
£2000 to reserve a unit - Payment is 30% (over 9 months) and
70% on completion if purchasing via a mortgage. Staged 12 payments
with cash.
8 What are the additional fees?
Closing costs approx 2% as most fees are covered by the Developer.
9 When will phase 2 be completed?
2 ½ years ie)2010-2011
10 What mortgages are available?
Mortgage details - 3 banks to choose from: please note these terms
can change dependent on credit rating and financial status etc....:
Asian Finance Bank –
· Maximum margin of finance of up to 70%
· Interest Rate: 7.5% fixed for 3 years, after 3 years
then becomes variable BLR (currently 6.75) + 1.75%
· No early redemption penalty
Bank of Nova Scotia –
· Maximum margin of finance of up to 70%
· Interest Rate: BLR + 0.75% variable.
· 5 year early redemption penalty – 3%
· Loan to value can be extended after completion to
70% of current market value without incurring redemption.
· Can pay up to 10% per annum without penalty
CIMB –
· Maximum margin of finance up to 60% only
· Interest rate : BLR + 0% (current BLR is 6.75%)
· Mortgage Reducing Term Assurance is compulsory (Life
Cover)
The lenders do not charge mortgage set up costs however there is
a legal fee to pay when setting up a mortgage in Malaysia which
the solicitor will send an invoice for at the point of signing the
loan agreement. The fees are approx 1.5-2%. These fees can be included
in the mortgage depending on the lender. If this is required this
will need to be specified upon application.
'I haven't got a 30% deposit in my bank account for a
deposit'
Not many people do - but what you can do is to look for other
ways to raise the money, a very common practice in this age
of multiple home ownership. One common method is to release
capital tied up in your own house, which may well have appreciated
since you first took out your mortgage. By increasing the
mortgage on your own house you can release the capital needed
for the deposit on a second home. Another option is to buy
the villa with another friend or family, sharing the cost
of the deposit. Whichever method you choose, it is important
that you don't overstretch yourself financially and consider
the process carefully. Many people can make it happen with
a little imagination.
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