The Loan Process After the SPA Is Signed
What happens between signing the sale and purchase agreement and the release of loan funds, and why this stage runs late most often.
Updated 21 August 2026 · Written and reviewed by Nur Nabilah Binti Mohd Aris
After the sale and purchase agreement is signed, the bank issues a letter of offer, loan documents are signed, the charge is prepared and stamped, and the bank releases funds. This stage most often decides whether the matter completes within the completion period.
Many buyers think the work is done once the sale and purchase agreement is signed. In practice the part that decides the outcome is only beginning.
The sequence
- Letter of offer. The bank issues a letter of offer setting out the loan terms. You have to accept it formally within the stated period.
- Valuation. The bank appoints a valuer. If the valuation comes in below the purchase price, the loan margin is affected and you may have to top up from your own funds.
- Loan documents. The bank’s panel solicitors prepare the loan agreement and charge documents for signature.
- Stamping. Loan documents are stamped at 0.5% of the loan amount.
- Charge registration. The charge is registered against the title after or together with the transfer.
- Release of funds. The bank releases funds to the solicitors for distribution under the settlement directions.
Why this stage runs late
- Incomplete supporting documents, so the bank asks repeatedly
- Valuation takes time or comes in differently from expectations
- Further conditions imposed after the letter of offer is accepted
- The buyer signs or returns documents late
- Coordination between two firms where the bank uses a different panel
If the valuation is below the purchase price
Banks lend against the lower of the purchase price and the valuation. If the valuation is low, the loan amount drops and you have to cover the difference. This is a situation to plan for, not to be surprised by at the last minute.
The costs involved at this stage
| Property price | Legal fees | Stamp duty | Estimated total |
|---|---|---|---|
| RM250,000 | RM6,413 | RM5,125 | RM13,538 |
| RM500,000 | RM12,825 | RM11,250 | RM26,075 |
| RM750,000 | RM18,090 | RM19,875 | RM39,965 |
| RM1,000,000 | RM23,220 | RM28,500 | RM53,720 |
| RM1,500,000 | RM33,480 | RM50,750 | RM86,230 |
What you can do
- Gather bank statements, payslips, EPF statements and tax documents before applying
- Do not open new credit facilities while the application is being processed
- Confirm with the bank whether your solicitor can handle the loan documents or whether their panel must be used
- Ask early what further conditions might be imposed
Frequently asked questions
How long does the bank take to issue a letter of offer?
It varies by bank and by how complete your documents are. Applications with complete documents move far faster than those chased repeatedly.
What if the loan is rejected after the SPA is signed?
It depends on the clause in the agreement. Some agreements allow termination with the deposit refunded if financing fails, others do not. Check before signing.
Can I change banks midway?
You can, but it starts again from the beginning and will almost certainly delay the matter. Consider the effect on the completion period.
Why do I sign documents at the bank's solicitors?
Because the charge is a document between you and the bank. The solicitors acting for the bank prepare and witness it.
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