One danger of buying below market value property for inexperienced buyer - ⚠️
Today an occupant of a house auctioned off last week contacted me as I'm the agent of my successful bidder.
Occupant told me that he was victim of scam by previous owner. He had "bought" the house at 700K+ via an agent and have released his 10% RM70K+ and also paid the agent RM20K commission. Ended up the house was still being auctioned off because owner didn't settle loan arrears. RM90K gone and ended up with no house 😢
Buyer and seller signed S&P... agent advise buyer to release 10% to seller... sound okay right? 🤷♂️Sadly no...
1)If the property is suspiciously below value....Buyer must check seller's loan arrears before releasing the money as current purchase price must be more than enough to cover owner's mortgage loan redemption sum...
2)If redemption sum is higher than purchase price (means owner making loss). Buyer better not release deposit because there is no guarantee the seller can settle the difference owing to bank after the sales.
3) So if got such case can buyer still proceed? Yes...buyer must appoint a lawyer as stake holder for his deposit. So both parties are protected. In event seller default then buyer wont lose his deposit.
Hope more buyers are aware and fall into trap by unethical seller & agent without knowledge. IF the deal is too good (below market value) then beware. 🙏
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