Wednesday October 31, 2012
When free legal fees is not free
IT has become a standard practise at almost every new property launch the offer of free Sale and Purchase Agreement legal fees be it for residential or commercial properties.
I wonder how many purchasers really know or have been briefed on the actual implications of this so called Free SP legal fee.
I purchased a new property from a developer with this free legal fee offer through an agent.
During signing of the SP agreement, the lawyer requested me to sign a letter acknowledging that since I won’t be paying the SP legal fees, he did not represents me.
All questions to certain unfavourable clauses in the agreement were answered with standard “this is standard agreement from the developer and we cannot change”.
When the property was completed and title issued, I was requested to pay a portion of the legal fees supposedly for MOT, i.e. registration of the title with the land office upon paying the stamp duty.
Only then I realised that the “free” legal fee was only for preparing the “standard agreement from the developer” which we cannot change.
To register your name in the title, there is another legal fee which comes up to 25% of the full legal fee calculated by normal rate on the purchase price.
My regular legal firm advised that registration of title is part and parcel of the Sale and Purchase and normally the purchaser pays the legal fee for the completion of the sales and purchase.
Even though it seems acceptable, I feel that this practice should be regulated.
FREE BUT NOT FREE