Property can be divided into two sections. A freehold or leasehold property. A freehold property is a property where you will have the rights on the property with any time frame or duration. For leasehold property, one will have a lease duration usually 30, 60 or 99 years.
Below are the disadvantages of purchasing a leasehold property :-
1. Less chance in appreciation in value.
2. Harder to sell. Even harder to sell if the lease is nearing the end.
3. Need to pay premium. To extend the period of the lease one needs to pay premium. The longer the extension of the lease, the more premium one needs to pay.
4. Harder to get loan. To purchase leasehold property, banks are more strict in giving out loans. Property which has shorter lease period might not even get a bank loan.
5. Limitations. The leasehold agreement places limitations on what can be done with the property. Eg. to knock down an old development and build a new one would require a new leasehold agreement. There are associated costs with each of those arrangements.
Wednesday, March 14, 2012
Tuesday, March 13, 2012
What Do You Know About Bankruptcy?
A bankrupt is someone who has officially declared that he cannot pay what he owes. In Malaysia, the minimum amount outstanding debt amount to initiate bankruptcy is RM30,000.
How Does a Person Become a Bankrupt?
1. Taking Up a Loan - There are various loans available to cater for different needs and wants. These loans can be personal loans, study or education loans, housing loans and even buying a car under a hire-purchase scheme.
2. Acting As a Guarantor - A guarantor can be a social guarantor or a corporate guarantor. A person who stood as a guarantor for loans like education, house, car hire purchase, scholarship and also third-party loans is known as a social guarantor. A corporate guarantor is a person who stood for loans relating to business loans, for example in a business partnership. A guarantor is also liable to face bankruptcy when summoned by the creditors. The creditors will go after the borrower first and if that fails to recover the amount owed, they will go after the guarantor to settle the debts.
3. Defaulting On Credit Card Payment - The inability to pay up the amount owed in the credit card account is also one reason to go bankrupt.
What Does It Mean To Be a Bankrupt?
1. He had to give up all his belongings and assets.
2. He is not allowed to open a bank account without the approval of the Director General of Insolvency (DGI).
3. He is not allowed to travel outside from the country without first getting approval from the DGI or the court. The DGI will hold his passport.
4. He is not allowed to do any business nor become a company director nor even be part of the company's management.
5. He has to sacrifice a certain percentage of his monthly income to the DGI to repay his debts.
How Does a Person Become a Bankrupt?
1. Taking Up a Loan - There are various loans available to cater for different needs and wants. These loans can be personal loans, study or education loans, housing loans and even buying a car under a hire-purchase scheme.
2. Acting As a Guarantor - A guarantor can be a social guarantor or a corporate guarantor. A person who stood as a guarantor for loans like education, house, car hire purchase, scholarship and also third-party loans is known as a social guarantor. A corporate guarantor is a person who stood for loans relating to business loans, for example in a business partnership. A guarantor is also liable to face bankruptcy when summoned by the creditors. The creditors will go after the borrower first and if that fails to recover the amount owed, they will go after the guarantor to settle the debts.
3. Defaulting On Credit Card Payment - The inability to pay up the amount owed in the credit card account is also one reason to go bankrupt.
What Does It Mean To Be a Bankrupt?
1. He had to give up all his belongings and assets.
2. He is not allowed to open a bank account without the approval of the Director General of Insolvency (DGI).
3. He is not allowed to travel outside from the country without first getting approval from the DGI or the court. The DGI will hold his passport.
4. He is not allowed to do any business nor become a company director nor even be part of the company's management.
5. He has to sacrifice a certain percentage of his monthly income to the DGI to repay his debts.
Monday, March 5, 2012
What Happen If There Is No Will?
If there is NO WILL in Malaysia, the estate will be distributed in accordance with the Distribution Act 1958 (Amended 1997) as follow:-
1. Spouse - 1/4
2. Parent - 1/4 (siblings if parent also die without will during the distribution process)
3. Children - 1/2
In the case when and intestate dies without leaving a surviving spouse, child or parent, the following person(s) are entitled to the estate in accordance to priority :-
1. brothers and sisters
2. grandparents
3. uncles and aunts
4. great grandparents
5. great uncles and aunts
6. government
Under the law, there is no provision for other groups of people (eg. partner, step children, illegitimate children, aged relative, etc). They might fall into financial difficulties without your support.
The legal process could take years. Assets could have frozen and shrunk in value when Letter of Administration is obtained.
Please consider writing a Will today for your loves one. Be sure they get what you want them to get when you are not around.
(Note: This Act does not apply to Muslims)
1. Spouse - 1/4
2. Parent - 1/4 (siblings if parent also die without will during the distribution process)
3. Children - 1/2
In the case when and intestate dies without leaving a surviving spouse, child or parent, the following person(s) are entitled to the estate in accordance to priority :-
1. brothers and sisters
2. grandparents
3. uncles and aunts
4. great grandparents
5. great uncles and aunts
6. government
Under the law, there is no provision for other groups of people (eg. partner, step children, illegitimate children, aged relative, etc). They might fall into financial difficulties without your support.
The legal process could take years. Assets could have frozen and shrunk in value when Letter of Administration is obtained.
Please consider writing a Will today for your loves one. Be sure they get what you want them to get when you are not around.
(Note: This Act does not apply to Muslims)
Saturday, March 3, 2012
Real Property Gain Tax (RPGT) & Exemption
Under Budget 2012, a new structure of RPGT was introduced:-
- Properties held and disposed within 2 years, RPGT = 10%
- Properties held and disposed after 2 years & up to 5 years , RPGT = 5%
(Note: The RPGT of 5% flat for disposal of real properties or shares un real property companies within 5 years is no longer applicable.)
However, RPGT is exempted or no RPGT is levied even though they are disposed within the first 5 years from the date of purchase:-
- Disposal of a residential property once in a lifetime by an individual who is a Malaysian citizen or a permanent resident if he/she elects in writing for the exemption to apply to that private residence.
- Transfer as gifts between parent and child, husband and wife, grandparent and grandchild which are deemed to be "No Gain No Loss" (transfer between sibling/brothers or sisters is not applicable); and
- Exemption of RM10,000 or 10% of the chargeable gain, whichever is greater, for each disposal of a property by an individual. Chargeable gain is generally meaning sale proceeds less purchase cost.
- Transfers between companies that bring greater efficiency or for purpose of reorganization/restructuring.
- Transactions in which the disposal price is deemed equal to acquisition price (i.e. “No Gain No Loss" transactions)
- Properties held and disposed within 2 years, RPGT = 10%
- Properties held and disposed after 2 years & up to 5 years , RPGT = 5%
(Note: The RPGT of 5% flat for disposal of real properties or shares un real property companies within 5 years is no longer applicable.)
However, RPGT is exempted or no RPGT is levied even though they are disposed within the first 5 years from the date of purchase:-
- Disposal of a residential property once in a lifetime by an individual who is a Malaysian citizen or a permanent resident if he/she elects in writing for the exemption to apply to that private residence.
- Transfer as gifts between parent and child, husband and wife, grandparent and grandchild which are deemed to be "No Gain No Loss" (transfer between sibling/brothers or sisters is not applicable); and
- Exemption of RM10,000 or 10% of the chargeable gain, whichever is greater, for each disposal of a property by an individual. Chargeable gain is generally meaning sale proceeds less purchase cost.
- Transfers between companies that bring greater efficiency or for purpose of reorganization/restructuring.
- Transactions in which the disposal price is deemed equal to acquisition price (i.e. “No Gain No Loss" transactions)
Friday, March 2, 2012
Fisherman & Businessman Story
There was once a businessman who was sitting by the beach in a small village. As he sat, he saw a fisherman rowing a small boat towards the shore having caught quite few big fish.
The businessman was impressed and asked the fisherman, “How long does it take you to catch so many fish?” The fisherman replied, “Oh, just a short while.” “Then why don’t you stay longer at sea and catch even more?” The businessman was astonished. “This is enough to feed my whole family,” the fisherman said.
The businessman then asked, “So, what do you do for the rest of the day?” The fisherman replied, “Well, I usually wake up early in the morning, go out to sea and catch a few fish, then go back and play with my kids. In the afternoon, I take a nap with my wife, and evening comes, I join my buddies in the village for a drink — we play guitar, sing and dance throughout the night.”
The businessman offered a suggestion to the fisherman. “I am a PhD in business management. I could help you to become a more successful person. From now on, you should spend more time at sea and try to catch as many fish as possible. When you have saved enough money, you could buy a bigger boat and catch even more fish. Soon you will be able to afford to buy more boats, set up your own company, your own production plant for canned food and distribution network. By then, you will have moved out of this village and to Sao Paulo, where you can set up HQ to manage your other branches.”
The fisherman continues, “And after that?” The businessman laughs heartily, “After that, you can live like a king in your own house, and when the time is right, you can go public and float your shares in the Stock Exchange, and you will be rich.”
The fisherman asks, “And after that?” The businessman says, “After that, you can finally retire, you can move to a house by the fishing village, wake up early in the morning, catch a few fish, then return home to play with kids, have a nice afternoon nap with your wife, and when evening comes, you can join your buddies for a drink, play the guitar, sing and dance throughout the night!”
The fisherman was puzzled, “Isn’t that what I am doing now?”
----------------------------------------------------------------------
We live in a world in which being successful is everything. Success is measured by power, popularity, control, achievement, wealth and winning. Having more and being more is success but how true it is? Let's spend some time to think about it. It's your life anyway. I hope you will find what you want....
The businessman was impressed and asked the fisherman, “How long does it take you to catch so many fish?” The fisherman replied, “Oh, just a short while.” “Then why don’t you stay longer at sea and catch even more?” The businessman was astonished. “This is enough to feed my whole family,” the fisherman said.
The businessman then asked, “So, what do you do for the rest of the day?” The fisherman replied, “Well, I usually wake up early in the morning, go out to sea and catch a few fish, then go back and play with my kids. In the afternoon, I take a nap with my wife, and evening comes, I join my buddies in the village for a drink — we play guitar, sing and dance throughout the night.”
The businessman offered a suggestion to the fisherman. “I am a PhD in business management. I could help you to become a more successful person. From now on, you should spend more time at sea and try to catch as many fish as possible. When you have saved enough money, you could buy a bigger boat and catch even more fish. Soon you will be able to afford to buy more boats, set up your own company, your own production plant for canned food and distribution network. By then, you will have moved out of this village and to Sao Paulo, where you can set up HQ to manage your other branches.”
The fisherman continues, “And after that?” The businessman laughs heartily, “After that, you can live like a king in your own house, and when the time is right, you can go public and float your shares in the Stock Exchange, and you will be rich.”
The fisherman asks, “And after that?” The businessman says, “After that, you can finally retire, you can move to a house by the fishing village, wake up early in the morning, catch a few fish, then return home to play with kids, have a nice afternoon nap with your wife, and when evening comes, you can join your buddies for a drink, play the guitar, sing and dance throughout the night!”
The fisherman was puzzled, “Isn’t that what I am doing now?”
----------------------------------------------------------------------
We live in a world in which being successful is everything. Success is measured by power, popularity, control, achievement, wealth and winning. Having more and being more is success but how true it is? Let's spend some time to think about it. It's your life anyway. I hope you will find what you want....
Becoming A Guarantor
Financial institutions may require guarantees from prospective borrowers to enhance the borrower’s credit standing and enable them to obtain financing.
If someone names you as a guarantor, you are legally bound to pay back the loan or balance there of if the borrower cannot or will not pay.
What must you remember as guarantor?
- Read and understand the nature of the guarantee. Most people willingly sign on as a guarantor without understanding the impacts on them.
- Check and ensure the guarantee is subject to the laws of Malaysia.
- Be wary about giving a copy of your identification to anyone other than the financial institution or your lawyers.
- Do not sign a blank or partially filled document, or if you do not have a financial, business or moral interest in the transaction.
- Do not become a guarantor to someone whom you have doubts about their ability or integrity.
- Ensure that you are aware of your liabilities in the event that variations are made to the terms and conditions of the loan.
How To Make A Bank's Complaint?
A bankrupt is someone who has officially declared that he cannot pay what he owes. In Malaysia, the minimum amount outstanding debt amount to initiate bankruptcy is RM30,000.
How Does a Person Become a Bankrupt?
1. Taking Up a Loan - There are various loans available to cater for different needs and wants. These loans can be personal loans, study or education loans, housing loans and even buying a car under a hire-purchase scheme.
2. Acting As a Guarantor - A guarantor can be a social guarantor or a corporate guarantor. A person who stood as a guarantor for loans like education, house, car hire purchase, scholarship and also third-party loans is known as a social guarantor. A corporate guarantor is a person who stood for loans relating to business loans, for example in a business partnership. A guarantor is also liable to face bankruptcy when summoned by the creditors. The creditors will go after the borrower first and if that fails to recover the amount owed, they will go after the guarantor to settle the debts.
3. Defaulting On Credit Card Payment - The inability to pay up the amount owed in the credit card account is also one reason to go bankrupt.
What Does It Mean To Be a Bankrupt?
1. He had to give up all his belongings and assets.
2. He is not allowed to open a bank account without the approval of the Director General of Insolvency (DGI).
3. He is not allowed to travel outside from the country without first getting approval from the DGI or the court. The DGI will hold his passport.
4. He is not allowed to do any business nor become a company director nor even be part of the company's management.
5. He has to sacrifice a certain percentage of his monthly income to the DGI to repay his debts.
How Does a Person Become a Bankrupt?
1. Taking Up a Loan - There are various loans available to cater for different needs and wants. These loans can be personal loans, study or education loans, housing loans and even buying a car under a hire-purchase scheme.
2. Acting As a Guarantor - A guarantor can be a social guarantor or a corporate guarantor. A person who stood as a guarantor for loans like education, house, car hire purchase, scholarship and also third-party loans is known as a social guarantor. A corporate guarantor is a person who stood for loans relating to business loans, for example in a business partnership. A guarantor is also liable to face bankruptcy when summoned by the creditors. The creditors will go after the borrower first and if that fails to recover the amount owed, they will go after the guarantor to settle the debts.
3. Defaulting On Credit Card Payment - The inability to pay up the amount owed in the credit card account is also one reason to go bankrupt.
What Does It Mean To Be a Bankrupt?
1. He had to give up all his belongings and assets.
2. He is not allowed to open a bank account without the approval of the Director General of Insolvency (DGI).
3. He is not allowed to travel outside from the country without first getting approval from the DGI or the court. The DGI will hold his passport.
4. He is not allowed to do any business nor become a company director nor even be part of the company's management.
5. He has to sacrifice a certain percentage of his monthly income to the DGI to repay his debts.
e-Share Payment
e-Share Payment is an electronic settlement facility provided by all stockbrokers for the purpose of :-
- payment of share sales proceeds by the stockbroker directly into your bank account
- providing an option for you to initiate payment via e‐channels (e.g. internet banking, mobile banking, ATM, etc) or to authorize the banks where you maintain your bank account to allow the stockbroker to debit your bank account (auto debit) for the purpose of share purchases.
e-Share Payment eliminates the need to bank-in the cheques received from the sale of shares and also enable you to make online payments anytime from the comfort of your home.
Check with your broker (not the bank) if you are interested. Not applicable trading account opened with the bank.
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