My team and I was discussing about a question that was posed to us regarding decoupling in private resale and I decided to looked at it in depth before sharing.
Case Study Scenario:
A + B are owners of a property and they want to remove A from the property so that A can purchase the next property without this existing property as a property count.
i.e. If A & B co-own a property, and A is a Singapore Citizen without any other residential property, and A would want to exit from the existing property to buy the next property without ABSD
- A + B to visit the law firm to do up a Sale & Purchase agreement to sell A’s shares to B
- Concurrently, B is to apply for a housing loan if a loan is required for B to buy over A’s shares and to refinance over the existing loan
Step 2 (Concurrent with Step 1 above)
- B to pay with the following as listed
- Exercise money 5% (cash)
- Buyer Stamp Duty
- Additional Buyer Stamp Duty (if required)
- Law firm representing B will apply for CPF / apply to the bank to disburse the monies for B to pay A on the completion of the decoupling transaction.
- Please arrange for at least 3 months from date of Step 1
- B will complete the purchase with A.
- Payment by B to A can be by cash and/or loan and/or CPF
IMPORTANT THINGS TAKE NOTE
If A would like to purchase the next property, A can only exercise the Option to Purchase for the next property after Step 1 & 2 is completed
If A would like to reuse the CPF refunds from the CPF used in the existing property, please time the completion of the next purchase to take place at least 3 weeks after the completion of the decoupling transaction.
All the above information serves as a general guide. Interested clients should arrange for an appointment with us to understand better on the process/ timeline/ finances required to enable a successful transaction.