Written by June Wong

What is Perfection of Transfer and Charge? It is important to understand what it is and why it is important for property owners to proceed with the Perfection of Transfer and Charge.

What is Perfection of Transfer and Charge?

Most people think that when they purchase a new property from the developer, the property belongs to them once they have signed the Sale and Purchase Agreement (“SPA”) and have received the keys to the vacant property, however, that is only half of the process. The truth is that without the Perfection of Transfer and Charge, the property title is still under the developer’s name instead of the individual owner.

The Perfection of Transfer is the process of transferring the ownership of the property from the developer’s name to you as the property owner.

The next question is how would it affect you as the property owner if your name is not on the registered title?

1. If your name is not registered in the title, the land office does not acknowledge you as the owner /buyer and the National Land Code 1965 does not regard you as the registered proprietor. What you have is only the beneficial ownership. Hence, you cannot exercise all rights and title as a registered proprietor. One of the rights as a registered proprietor is that if you are selling your property, there will be delay as you need to request the Developer to transfer the property directly to your potential buyers. If the Developer refused to do so, you need to start the process of perfection before you have the right to sell the property to potential buyers as the registered proprietor of the property. A potential buyer may not want to wait for such long period of process and they may also face difficulties in getting loan approval on the basis that banks are often reluctant to grant loans where strata titles either have not been issued or are issued but not yet perfected.

2. If the developer or the proprietor of the land (master title) upon which your unit is erected is wound up or dies, the whole perfection process became complicated. If the Developer is wound up or an individual proprietor is bankrupt, the liquidator will take over, but there are liquidator fees incurred and this process will be long and exhausting.

3. Further, if you have taken up a mortgage to finance the purchase of the property, you would have given your undertaking to the Bank to conduct the perfection of transfer and charge process upon issuance of the title, through signing of various Bank’s documents with the Bank’s solicitors. If you refused to do so, the solicitors will notify the Bank. In this case, the Bank, upon advise of the solicitors, may choose to exercise the Power of Attorney granted by you to execute the Memorandum of Transfer and then proceed to register the charge in favour of the Bank. If this happen, all additional costs will be borne by you.

4. Lastly, one of the consequences of not perfecting the transfer of the strata title within the specific period as informed by the developer, is the imposition by the developer of an additional storage charge on the property owner. Some developers may impose storage charges that ranges between RM 100 to RM 150 per month, for every month of failure or delay to effect the Perfection of Transfer and Charge.

To conclude, it is very important for property owners to have  an issued title registered in your name to prove your indefeasible ownership of the property i.e. full ownership of the property which cannot be defeated, revoked, or made void, and it also allow you to fully exercise the rights over your property, including voting on the management affairs of the development and also disposing it with greater ease.

Written by Hang Yong

The Malaysia My Second Home (MM2H) programme is a programme which allows foreigners to stay in the country on a long-term basis. It was previously suspended due to the covid19 global pandemic.

Malaysia recently announced the reactivation of the MM2H programme after nearly 2 years of suspension, and it returns with the increase in both financial and temporal requirements compared to the previous MM2H programme.

The below is a list of changes that were announced:

i) The offshore income applicants are now required to have a monthly income of at least RM40,000 from the previous requirement of RM10,000.

ii) The applicants need to deposit and hold RM1 million in a Malaysian Fixed Deposit account for a year, from the previous requirement of RM150,000 (if you are over 50) to RM300,000 (if you are below 50).

iii) Applicants  to demonstrate liquid assets worth at least RM1.5 million which the previous was only RM350,000.00/RM500,000.00.

iv) The renewable Multiple-Entry Visa Validity has been reduced from 10 years to now 5 years.

v) Applicant must be at least 35 years old.

vi) There is now a RM5,000 processing fee for the principal and RM2,500 for each dependant.

vii) The applicant must fulfil minimum stay period of 90 days.

The financial hike of the requirements and addition of the criteria will definitely make the whole application process a prolonged and more complex one. In view thereof, there are many who called for the new requirements to be reviewed.

From the economical point of view, research shows that more than 90% of the current visa holders do not meet the new criteria and be likely to be forced to leave Malaysia and, of course, take their money with them. This small group of who did relocate here have contributed billions of ringgit to the Malaysian economy. As such, if they are forced to leave, not only will the country lose billions of ringgit but it will also severely tarnish the image of the programme itself. That would be very sad as it was widely regarded as one of the world’s best retirement programme in the world.

The MM2H programme attracted over 50,000.00 participants over last two decades. The programme helped Malaysia position itself as a country that values international connectivity and foreign direct investment. But all these positive brand equity MM2H spent decades building has now been completely obliterated with the changes of the new MM2H rules.