Legal fees for aborted loan

Hi Kin Lian
I have signed an OTP to buy a flat and proceed to get a bank loan for it. I have subsequently ask for a AIP(approval in principle) loan approval from a bank. It was stated that the loan is void if HDB disapprove the sale.


The sale was disapproved by HDB and I immediately informed the bank. I was assured that it will be void with no further actions needed from my side. However 2 months later, I was told that I have to pay the law firm, which the bank engage to lodge a caveat 1 month after I faxed in the HDB letter.  Can you advise if this is a common practice? Who should be paying for the law firm fee?


I have checked with the bank, however they claim that I should pay for it. I'm still contesting it and I'm asking them to state the clause though it was not mentioned to me beforehand.  You might want to highlight to the readers when they are taking up loans from a bank.

REPLY
I think that the bank should bear it unless there can show you a clause in the agreement that states clearly that you are required to pay the fee. If they incur the expenses after the loan has been rejected, then they should bear the cost as it was their mistake.