Memorandum Of Transfer (MOT) And 4 Important Documents In Malaysia

When buying a property, there are many types of documents that you need to know, and one of it is the Memorandum of Transfer (MOT). We're going to walk you through why this piece of paper is so important to have, as part of the home ownership process.
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When it comes to buying that dream home, there are more than a few documents you need to remember.

These legal documents are the official checkpoints on your property purchase journey, and one of the most important you’ll encounter is the Memorandum of Transfer (MOT).

The MOT is the clap-your-hands-and-laugh-in-delight part of purchasing a property. Sure, you’ve got your fancy Sales and Purchase Agreement (SPA) with all the terms and conditions laid out.

That’s important too, don’t get us wrong. But it’s when the Memorandum of Transfer comes into play that things really get ownership-level exciting.


What is MOT (Memorandum of Transfer)?

In Malaysia, a Memorandum of Transfer (MOT) is a document that the buyer signs to transfer ownership from the seller to the buyer. 

Signing the MOT means that the Land Title will be transferred from the developer or previous proprietors’ name to yours. Hence, it’s not issued if the property in question doesn’t have its Land Title yet. 



What are the Steps in Transfer of Ownership?

Transferring ownership of something as important (and valuable!) as a property requires some crucial legal steps.

So once you’ve identified a realistic piece of real estate which you can afford and it shows good potential for capital gains yield, it’s time to start the legal process.

Here are the 5 key steps in the legal process of buying a house, and the documents that go along with them.

1. Home Loan And Lawyer Up

Searching for the right home loan is the first step towards owning a property, unless you’ve got reallyyy deep pockets, of course! It’s also the perfect point to contract a legal professional to help with the process.

It’s not compulsory for you to hire said professional, but with all the many legal documents to come, it’s probably a pretty good idea to get all the help you can!

2. Letter Of Offer (LO)

You’re at the start of the purchasing process, and you’re keen to put your name down for a property.

The Letter of Offer is a document which sets out your initial desire to purchase, and a seller’s willingness to sell.

It notes things such as the agreed selling price, relevant furnishings, and the date by which the SPA should be signed.

3. Sales And Purchase Agreement (SPA)

This is it, the legal document we’ve all been waiting for. The SPA is a comprehensive agreement setting out the terms and conditions of a purchase.

This important document sets out conditions such as the date of transfer, conditions of purchase, items included in the sale, as well as other relevant terms.

4. Facility Agreement

It’s time for the Facility Agreement! Don’t worry, this isn’t about setting out your access to the swimming pool and gymnasium.

This is the legal document to officially confirm the home loan agreement that you have signed with your bank.

5. Memorandum Of Transfer

It’s the big one now! Here's your chance to sign your Memorandum of Transfer, or the less excitingly titled ‘Form 14A’. MOT in Malaysia is the document which legally confirms the actual transfer of ownership.

It’s the legal equivalent of handing you the keys to the front door and saying the property is yours. 



What do Master Titles and Strata Titles Have to do with The Memorandum of Transfer (MOT)? 

Now you might think that it all sounds relatively straightforward, so we’re going to throw a strata-shaped spanner in the works.

Only properties which have the relevant master title will have their ownership transferred using an MOT.

The MOT will not be used as a transfer method for properties without the relevant master, individual, or strata title.

This sort of situation would usually relate to strata properties where developers have not yet properly registered the individual properties. 


What happens if the Land Title has not been issued?

Master, individual, or strata titles are all considered Land Titles, and they’re extremely important when it comes to the transfer of ownership. 

In cases where the property to be bought had not received its relevant Land Title, a Deed of Assignment (DOA) form is used to transfer ownership of property, and a further document recording the Developers Consent will also be required.

It’s also worth mentioning that strata titles (Land Titles typically issues for high-rise properties) sometimes come with a Deed of Mutual Covenants.

This deed is a legal document which sets out promises of behaviour and obligations for ownership in these shared developments.

It lists down things like pet ownership, acceptable renovations, and all sorts of stuff to make sure that these shared communities don’t get too crazy.


Why is Having a Lawyer Important when Buying Property?

We mentioned the value of getting a lawyer to help you through this process, and now hopefully you’ve got a good idea of ‘why’.


The lawyer is essentially your champion in ensuring you get the right deal, and that everything is done properly and honestly.

They’re trained to draft up and check through complex legal documents (like the SPA) to ensure that the terms and conditions are fair and balanced. 

That means making sure you’re not signing up to some crazy deal where it turns out you’re only allowed to use the front door of your property every third Tuesday.

Of course, in reality, that kind of extreme example is unlikely to happen, but there are all sorts of complicated legal jargon that are important to cross-check.

A legal professional is also experienced in navigating processes to:

  • Ensure everything runs smoothly
  • Making sure things like documents are stamped
  • Legal requirements are fulfilled within the right time frame
  • All sorts of other little miscellaneous things you’d never know to check

That also involves searching Land Office registrations to ensure the property you’re actually buying, really does belong to the person selling it.

There’s so much to remember that it’s easy to slip up, thus having someone in-the-know would greatly expedite everything!



What does Stamp Duty have to do with the Memorandum of Transfer (MOT)?

When acquiring a property, you can expect plenty of legal documents, plus stamp duty tax on each document to top it off. 

The MOT is no different, and in fact is one of the heftiest when it comes to stamp duty costs. MOT stamp duty varies between 1% - 4% of the property sale price. Scroll down to check out the detailed tiers. 


What Are The Costs Associated With Each Stage of Buying a Property?

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Alongside the major payments of purchasing the property itself, there are actually a number of financial requirements and transactions linked to the various legal steps noted above:

1) Loan Agreement

As if the financial burden of a loan wasn’t "exciting" enough, you also have to pay the legal fees for it!

House Price

Legal Fees Charge

First RM500,000

1% (minimum RM500)

Subsequent RM2 million


Subsequent RM2 million


Subsequent  RM2.5 million


2) Letter Of Offer

This is usually the point where an earnest deposit comes into play. That’s 2% of the total value of the property, and counts towards the overall 10% downpayment.

The earnest deposit is usually non-refundable.

3) SPA

Signing the SPA is when the big money payments begin. At this point, the full 10% down payment will be required. Any earnest deposit already paid will count towards this total.

This will also require payment of the SPA's legal fees.

House Price

Legal Fees Charge

First RM500,000

1% (minimum RM500)

Subsequent RM2 million


Subsequent RM2 million


Subsequent  RM2.5 million


4) Memorandum Of Transfer

It makes sense that the Deed of Transfer document is also the part where the largest stamp duty is owed! As of 1st July 2019, these are the stamp duty charges that will be due.

House Price

Stamp Duty Charge

First RM100,000


RM100,001 – RM500,000






PropertyGuru Tip
First time homeowners currently benefit from various government exemptions, which you can find out more about on our stamp duty guide.


Stamp Duty Costs for Purchase of Property

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Now, let’s put that into perspective shall we?

Here’s an example of how much it will cost you in stamp duties alone when purchasing a home. To illustrate, let’s say you’re purchasing a house at RM800,000 with a loan of RM700,000.

Example of Total Stamp Duty Calculation

Stamp Duty for Loan Agreement

1% on first RM500,000


0.8% on subsequent RM200,000

= RM5,000


= RM 1,600

Stamp Duty for SPA

1% on first RM500,000


0.8% on subsequent RM300,000

= RM5000


= RM 2,400

Stamp Duty for MOT

1% on first RM100,000


2% on subsequent RM300,000

= RM1,000


= RM6,000

Total Stamp Duty Costs Involved



Stamp Duty Exemptions in 2020/2021

Ouch, that’s a lot of money for stamp duty alone... good news though! If you’re a first-time homebuyer or buying a property under the Home Ownership Campaign (HOC),  there are stamp duty exemptions in place to help you shave off some of the costs. 

1) Stamp Duty Exemptions for First-Time Homebuyers

Under Budget 2021, full stamp duty exemption will be given on both the Memorandum of Transfer (MOT) and loan agreement.

The eligibility criteria include:

  • For first-time homebuyers only
  • Property worth not more than RM500,000
  • This exemption is for the Sale and Purchase Agreement completed between January 2021 to 31 December 2025

If your property is priced at RM500,000 (which is the maximum price tag to be eligible for this exemption), that's about RM11,250 in savings!

2) Stamp Duty Exemptions under the Home Ownership Campaign (HOC) 2020/2021

That’s right, if you didn’t already know, the HOC is back for 2020/2021. Find out all about it here.

Under the Short-Term Economic Recovery Plan (PENJANA) announced on 5 June 2020, two stamp duty exemptions were introduced. 

Full Stamp Duty Exemption on MOT and Loan Agreement 

  • For residential homes priced between RM300,000 to RM2.5 million
  • Subject to a minimum 10% discount by the developer
  • Exemption on MOT is limited to the first RM1 million of the property price.

Full Stamp Duty Exemption on Loan Agreement


How About Closing Costs When Buying A Property?

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The fees don’t stop there, there are closing costs too. Closing costs are the necessary fees to be paid by the buyer during the final steps of the property transaction. In Malaysia, these are mostly paid by the buyer.

Stamp duties aside, some closing costs that you may incur are:

1) Real Property Gains Tax (RPGT)

RPGT is a tax imposed on gains derived from disposal of real property. In simplest terms, it's a tax on your net profit when you sell a property. If you’re the seller, this cost may be applicable to you. 

RPGT is taxed on a tiered basis between 5% - 30% depending on various factors such as how long you’ve owned the property for before selling it off. Just as with stamp duty however, there are RPGT exemptions too!

2) Legal fees

Legal fees are the fees charged by the lawyer to draft the Letter of Offer as well as the Sales and Purchase Agreement (SPA) as well as other legal matters associated with the sale. In Malaysia, the legal fees are typically split between seller and buyer and are charged on a tiered basis. 

3) Valuation fee

The valuation fee is paid to a bank-appointed valuation expert to estimate how much money the property is likely to be worth. This fee typically costs about 0.3% of the final property value.

4) Property agent commission

If you’ve enlisted the help of an agent to assist you in the sale or purchase of a property, it will typically cost you a commission fee. This fee is stipulated by the agent, but regulated at a maximum of 3% of the property’s sale price. 

5) Mortgage insurance

Your mortgage insurance will either come in the form of Mortgage Level Term Assurance (MLTA) or Mortgage Reducing Term Assurance (MRTA), with the MRTA generally ten times more affordable than the MLTA. 

6) Home renovation and refurbishments

Aside from the costs associated with the legal documents involved, let’s not forget about the renovation costs! Before closing the deal, you’d want to settle any pressing renovations such as leaks or tiling. 


What Does a Transfer Of Love in Property Mean? 


A transfer of love is (maybe) the sweetest-sounding property transaction you’ll ever hear of. What it relates to, is use of an MOT to transfer property between family members.

That means situations like husband to wife or parent to child. In these cases, the stamp duty for the MOT is waived either fully or partially.

You receive 100% exemption in the case of wife to husband and vice versa, and 50% exemption in the case of parent to child or vice versa.


The journey to property ownership can sometimes feel like an uphill battle against legal documents. But remember these documents are there to protect your rights as much as the rights of others. Of course, the MOT isn’t the last step on that journey, so if you want to find out more – read our Essential Guide to Vacant Possession!

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