By Farah Wahida:

Before signing a letter for vacant possession of a property, home buyers should read the fine print, especially in cases wherein a developer refuses to hand over the keys of a property unless a letter is signed, according to the National House Buyers Association (HBA).

“What house buyers must know is that this letter for collection of keys should contain nothing more than an acknowledgement by the buyer that he has collected the keys and a confirmation as to how many sets of keys are given,” said Chang Kim Loong Honorary Secretary-General of HBA and councillor at the Subang Jaya Municipal Council.

As such, the letter must not contain any terms or conditions stipulating that the buyer has waived certain rights, benefits and entitlement under the sale and purchase agreement (SPA), or that the buyer forfeits any claim whatsoever against the developer.

This is because unscrupulous developers used this letter to escape paying liquidated ascertained damages (LAD) to home buyers affected by a project’s late completion. LAD is 10 percent per annum of the purchase price, depending on the period of delay.

But what can home buyers do if the letter contains a waiver, and they are forced to sign it so that they can get the keys, asked Chang.

“Sign ‘Under Protest’ is one way. The house buyer can write a note on the letter that he does not agree to waive LAD, or that he does not agree to waive his rights, or that it is ‘Without Prejudice’ to his/her rights under the SPA. Alternatively, he can delete the offending words or sentences.”

Moreover, they can also file a complaint at the Housing Tribunal and the Enforcement Division of the Housing Ministry (www.kpkt.gov.my).

Farah Wahida, Editor of PropertyGuru, wrote this story. To contact her about this or other stories email farahwahida@propertyguru.com.my

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