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Questions and Answers
What is the purpose of conducting bankruptcy searches during the Sale & Purchase Agreement process?
Under what condition is a property sold on an 'as is where is' basis?
What must the title of the property ensure upon completion of the Sale & Purchase Agreement?
What is the timeframe typically expected for completion after the conclusion of the contract?
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What is the implication of the Law Society's Conditions of Sale regarding 'time is of the essence'?
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Which of the following best describes the process of concluding a contract through an Option to Purchase?
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What is a potential risk associated with paying option money before seeking legal advice?
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How is the further payment typically structured once the Purchaser decides to exercise the Option?
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What document outlines the standard terms and conditions regarding the sale in real estate transactions?
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What should the Purchaser consider regarding the Vendor's obligations once the signed Option is exchanged?
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What happens if the seller fails to pay seller's stamp duty under Cond 7.4 of the 2020 conditions?
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In which scenario does the withholding tax apply?
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What are the GST implications when a vendor is a taxable person selling non-residential properties?
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According to 7.2 of LSCS 2020, who is responsible for paying GST on the purchase price?
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What is the primary purpose of lodging a caveat?
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How does lodging a caveat affect conflicting claims?
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Which of the following is a requirement for a caveat to be effective?
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What stipulation does Section 45D impose on the purchaser's solicitor?
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Study Notes
Concluding Contracts
- Option to Purchase: Vendor prepares draft, Purchaser reviews and amends, parties negotiate, Vendor signs, Purchaser pays option money (usually 1% of purchase price), Purchaser exercises option within 2 weeks by signing acceptance copy and paying further sum (usually 4% of purchase price).
- Sale and Purchase Agreement: Vendor prepares draft, Purchaser reviews and amends, parties negotiate, agreement is signed. Completion is usually within 8 to 10 weeks. Searches are updated on the day the contract is concluded (bankruptcy, company winding up, judicial management, title search).
Major Terms
- Title: Must be properly deduced and free from encumbrances on completion.
- Possession: Vacant possession or subject to tenancy.
- "As is Where is" Basis: Buying with full notice of state, condition, access, repair, drainage, and area, and all other respects.
- Legal Requisitions: Questions sent to various government departments. Define clearly what constitutes “unsatisfactory” replies.
Law Society’s Conditions of Sale 2020
- Outgoing apportionment (property tax, levies, rent).
- Late completion interest.
- Time is of the essence.
- Procedure of serving Notice to Complete.
Stamp Duty
- Payable within 14 days of concluding the contract.
- Cond 7.4 of the 2020 Conditions provides for the purchaser’s lawyer to deduct from the monies due to the seller should the seller fail to pay seller’s stamp duty.
Withholding Tax
- Applies when vendor is not resident in Singapore for income tax purposes or is assessed as a property trader.
- Purchaser's solicitor is liable to withhold tax in these situations.
Goods and Services Tax (GST)
- Chargeable on the sale or lease of non-residential properties where the vendor is a taxable person.
Caveat
- Serves as notice to third parties of the purchaser’s interest.
- Enables the purchaser to be notified of subsequent dealings.
- Prohibits registration of any other instrument claiming a conflicting interest.
- Gives priority if lodged early and there are conflicting claims.
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Description
Test your knowledge on concluding contracts, particularly focusing on options to purchase and sale agreements. The quiz covers major terms and essential processes involved in contracts, from vendor preparations to legal requisitions. Perfect for anyone studying real estate law or contract management.