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The Owner Finance Agreement is a crucial document used in Malaysian property transactions where traditional bank financing is either not preferred or not available. This agreement enables property owners to sell their property while acting as the financier, creating a direct financial relationship with the buyer. The document must comply with Malaysian legal requirements, including the Contracts Act 1950, National Land Code 1965, and relevant financial regulations. It typically includes comprehensive details about the property, purchase price, payment terms, interest rates, security arrangements, and default provisions. This type of agreement is particularly useful in situations where buyers may not qualify for conventional bank loans, or when sellers wish to generate ongoing income through interest payments. The document provides protection for both parties by clearly outlining their rights, obligations, and remedies under Malaysian law.

1. Parties: Identifies and defines the parties: the Property Owner/Seller-Financier and the Buyer/Purchaser

2. Background: Sets out the context of the agreement, including the owner's title to the property and the buyer's desire to purchase with owner financing

3. Definitions: Defines key terms used throughout the agreement

4. Property Details: Detailed description of the property being sold, including legal description and any encumbrances

5. Purchase Price and Payment Terms: Specifies the total purchase price, down payment, and financing amount

6. Interest Rate and Amortization: Details of the interest rate, how it's calculated, and the amortization schedule

7. Payment Schedule: Monthly payment amounts, due dates, and payment methods

8. Security and Title: Provisions regarding property title transfer and security arrangements

9. Insurance Requirements: Mandatory insurance coverage for the property

10. Property Maintenance and Responsibilities: Obligations regarding property upkeep during the financing period

11. Default and Remedies: Consequences of default and available remedies for both parties

12. Transfer and Assignment: Restrictions on transferring rights under the agreement

13. Notices: How formal communications between parties should be made

14. Governing Law: Confirms Malaysian law governs the agreement

15. Execution: Signature blocks and execution requirements