Conveyancing & the role of a conveyancing lawyer
Conveyancing is the legal process of transferring ownership of real property from one person to another. In Malaysia, this process involves:
- Performing due diligence on the parties and the property involved
- Drafting and reviewing the Sale and Purchase Agreement (S&P / SPA)
- Conducting land searches
- Securing state authority consent
- Filing the relevant Real Property Gains Tax Forms
- Preparing loan documentation
These steps involve not just paperwork, but legal precision to avoid costly mistakes.
Is it mandatory to appoint a conveyancing lawyer?
While you may need the services of a conveyancing lawyer to complete certain aspects of the transaction (i.e. witnessing your signatures, preparing loan documentation etc.) you are not legally required to appoint a conveyancing lawyer.
However, due to the complexity of certain land transactions (e.g. where the land in question is encumbered or where state authority consent is requires) it would be prudent to appoint an experienced conveyancing lawyer.
Further, it is worth noting that if you are intending to apply for a housing loan to finance your purchase, banks require you to appoint their panel lawyers to attend to the loan documentation process.
What if I decide not to use a conveyancing lawyer?
If you decide to be unrepresented in a property transaction, you may be exposed to the following risks:
Legal pitfalls
Unfamiliarity with the legal process and the legal documentation involved may expose you to unwanted delays and costly mistakes.
Without legal guidance, you may be a victim of unfair terms, miss crucial deadlines or misinterpret contract clauses, potentially resulting in penalties or even legal disputes.
Dealing with Authorities
If you have no experience dealing with the relevant authorities (e.g. land office, land registry, IRB etc.) you may be unfamiliar with their processes and requirements.
It must be noted that the different land registries and land offices in Malaysia tend to have their own processes and administrative procedures that must be complied with.
Risk management
A conveyancing lawyer often acts as stakeholder in holding large sums of money or important documents while pending compliance of certain terms and conditions by parties to the sale and purchase agreement.
Without a stakeholder, parties would have to resort to releasing large sums or important documents to the party with no guarantee that they will perform their obligations under the sale and purchase agreement.
Cost of appointing a conveyancing lawyer
Legal fees for conveyancing in Malaysia are regulated by the Solicitors Remuneration Order (SRO) 2023 and are usually calculated as a fixed percentage of the property price.
In other words, legal fees for most conveyancing matters are fixed by law (including any discounts that law firms are entitled to give).
Therefore, since all law firms are required to charge their fees strictly according the SRO, it is more important to look for a firm you can trust.
Conclusion
While hiring a conveyancin lawyer in Malaysia may seem like an optional expense, it is often essential – especially if you want to protect your interests, ensure that the transaction is valid, and avoid costly legal pitfalls. As property transactions involve significant sums and legal complexity, expert guidance is invaluable.
So, do you really need a conveyancing lawyer in Malaysia? In most cases, the answer is a clear YES.