debt collection in thailand

[MartinKal]

Has anyone any knowledge of a farang obtaining repayment of debt in thailand?

What are the problems with debt collection here?

Is it possible to go to court without a lawyer - is there a 'small claims court'?

[Ulysses G.]

A buddy of mine sued a Thai loan shark (that he had invested with) and won. However, I do not know if he was ever able to collect the debt. 

[ezzra]

It's all very much depend on the type of the debt, the nature of it

and how well documented  it is, if the debts is backed up by

a proper contract of loan where it's states very clearly the

conditions of the loan, terms and lawfully interest payable

than you can either sue as criminal or civil and in both cases

you will need a lawyer, now lawyers in Thailand is another story,

a sad story at that....but in general debts collecting is mostly iligal

and fraught with controversies, going the legal is best, but money

and time consuming and not always successful.....

[Dante99]

1 hour ago, Ulysses G. said:

A buddy of mine sued a Thai loan shark (that he had invested with) and won. However, I do not know if he was ever able to collect the debt. 

That is the rib, you can win in court and end up getting nothing.

[meatboy]

best to look out for,2on a bike ,dressed in black,a black shiny jacket,black helmet with a blacked out visor and a concealed ?

that's your best bet to be able to get anything.

[dotpoom]

There is a small claims court in Pattaya.

[Loaded]

Farang solutions for a Thai problem usually don't work.

 

From my experience of living her, I have seen several ways debts can be collected.

 

1. You use a senior person in society, or perhaps a policeman (high risk), to negotiate on your behalf. 'krieng jai' pressures the other side to compromise. 'compromise' is the key because face cannot be lost. You may not recover all the debt and some may go to the intermediary, but you still get something.

 

2. You scare the other person with threats of violence. It's unlikely this will be successful for farang because Thais have all the advantages - connections, language, tribal solidarity etc. Plus, they will kill you first.

 

3. You try and outwit them. Again, difficult for farang because they are living here oblivious of all the social mores that control Thai behaviour.

 

Courts are a waste of time.

Edited September 4, 2017 by Loaded

[Minnehaha]

2 hours ago, ezzra said:

It's all very much depend on the type of the debt, the nature of it

and how well documented  it is, if the debts is backed up by

a proper contract of loan where it's states very clearly the

conditions of the loan, terms and lawfully interest payable

than you can either sue as criminal or civil and in both cases

you will need a lawyer, now lawyers in Thailand is another story,

a sad story at that....but in general debts collecting is mostly iligal

and fraught with controversies, going the legal is best, but money

and time consuming and not always successful.....

Well said. 

Agree and would add that criminal cases can usually be resolved in month or 3. Civil cases usually take much longer but you can sue for more money like damages etc.  

[phantomfiddler]

Unfortunately the Thai courts do not enforce the decision, even though they will probably rule entirely in your favour. Unless it is a sizable sum best to just learn and forget it. An alternative would be to promise a policeman a decent percentage if he can make that person pay up. Thai policemen do have considerable sway over us, especially when there is motivation :)

[RickFarang]

Was repaid by three people. One a woman who had a stall at a open air market and needed money to move the stall to a better location -about 530,000 baht. It took a couple of months but she paid off every last baht. Later she borrowed about 55,000 baht to expand her inventory and once again she paid it all back!

 

The other two were an Australian and an American in separate loans totaling about 110,000 baht. They both paid off fully though one took over two years.

 

In none of the above cases was it necessary to remind them of their debt.

 

This is in contrast to hundreds of thousands not paid back. I now refuse to make loans but will make small gifts to get people out of hot water.+

[khunPer]

I don't think you can go to Court without a Thai lawyer.

 

Benjawan Poomsan Becker and Roengsak Thongkaew says in the book "Thai Law for Foreigners" (ISBN 978-1-887521-57-4) on page 27:

 

»Unless you are a court officer or work in the legal profession, you don't want to go to court in Thailand. Thais consider going to court, or having matters that require them to go to court, to be bad luck...«

and:

»You can go to court as a plaintiff in either a criminal or civil case. For criminal matters, the prosecutor is your representative, and for civil matters, you will be represented by a private lawyer...«

 

Just using a lawyer that states in his letters to debitor, that he will bring the case to the Court, may result in some level of debt collection or payment plan, depending of size of debt; and of course that the paperwork is in order and within the law (for example interest rate charged, if any).

 

A Thai lawyer will normally give a price for the full case and ask for an advance, before he writes the first letter. If he is going to do further, he may want the full payment up front, plus Court fees (which will be returned, if you win the case). Sometimes it's possible to make a agreement before a Court meeting, but ask the lawyer to have the agreement fulfilled in the Court in front of the judge, as it will then be a binding agreement. If no payment is received, agreement or not, you can consider to take possession of property, but you, or your lawyer's office, will need to find out what can be processed (which might cost you extra fees to look up).

 

The good news is, that a foreigner can sue a Thai with success for a financial debt if the paperwork is clear and in accordance with the rules (I talk from positive experience); the bad news is, that when some Thai lawyers have been prepaid, they will work extremely slow (not much interest in the case, any longer, however an extra tip, like offering some level of transport compensation for a Court meeting, can speed up the process again).

 

Wish you good luck...

 

EDIT: I should add, that a Thai lawyer, and a judge in the Court, may offer debitor a discount to settle the case, or make a "binding" payment plan; further compensation for your expenses to lawyer etc. may not be included. But talk to the lawyer about, what is possible in your case.

Edited September 4, 2017 by khunPer

[twizzian]

4 hours ago, Loaded said:

Farang solutions for a Thai problem usually don't work.

 

From my experience of living her, I have seen several ways debts can be collected.

 

1. You use a senior person in society, or perhaps a policeman (high risk), to negotiate on your behalf. 'krieng jai' pressures the other side to compromise. 'compromise' is the key because face cannot be lost. You may not recover all the debt and some may go to the intermediary, but you still get something.

 

2. You scare the other person with threats of violence. It's unlikely this will be successful for farang because Thais have all the advantages - connections, language, tribal solidarity etc. Plus, they will kill you first.

 

3. You try and outwit them. Again, difficult for farang because they are living here oblivious of all the social mores that control Thai behaviour.

 

Courts are a waste of time.

 

So he really doesn't have a cat in hell's chance to get more than a ฿100 back

[Global Guy]

I've tried to use police to mediate a case where they found a Thai taxi driver guilty of reckless driving (he hit me on my motorcycle and I had significant injuries and needed numerous surgeries to put me back together).

 

The driver would show up at the police station in his taxi company uniform, park the yellow/green taxi in front of the entrance to the police station, and tell the police he didn't have a job any longer and could not pay anything towards my hospital bills. I had my Thai wife with me. I pointed out the obvious, that he was in uniform and his taxi was parked three meters from us. We had 4 more "mediation" meetings and finally he said he could pay a ridiculously low amount, that would take about 10-15 years to pay off the balance.

 

Mind, you, my wife is educated and works in the construction engineering field and is used to negotiating with Thais. The meetings got no where. Of course, it was the driver's plan to frustrate us and eventually I had to leave Thailand for additional surgeries and we gave up. The good part was the court gave us some money he paid for fines. Then, when he was arrested and posted bail, they called us to collect his bail, which we did. 

 

We also tried to get an attorney during all of this and met with four firms. All four tried to scam us and we gave up on that too.

 

Overall, the rule of law in Thailand for foreigners, in my opinion, is nonexistent. It's zero. There may be some charade of rule of law, (with some exceptions thrown in) but in the end, it's just that...a theater designed to look like a legal system for expats.

 

This lack of rule of law is also why I steered my investment group away from Thailand and I decided against buying investment property, a business, and a house/condo myself. Again, there are exceptions, but the system is built against foreigners. 

[ubonjoe]

A off topic post meant to derail the topic has been removed.

[CyclingLight]

Having tried to reclaim a bad loan, I first went to my local police station and the officer was quite interested and willing to apply pressure until he saw that the debtor lived in another jurisdiction.

 

I went to the police where the debtor lived and the first officer took my phone to try to call the guy who owed me, but the call didn't go through and he took me to a more ranking officer, who looked at the information I presented (the loan papers and ID of the debtor). He then asked if I was gay and turned me away. Can't remember if it was him or someone else who sent me to the nearby civil court. I often wondered if I returned to that police station and got a different officer if there might have been a different answer.

 

At the civil court, I was told it could be done by going to the civil court in the province where the loan was issued (which in my case was based on my address), but that it would take a lot of time spread over months, and in the end perhaps be fruitless if the person who owes you doesn't have the money anyway. I got the impression that I could do it without a lawyer. 

 

My "local" court is quite far away and unhandy to get to, so I never followed up on the court option. 

 

I asked around, but the amount of the loan (28,500Baht) was too small for a lawyer to be involved and I so far haven't met anyone willing to collect it for me.

 

Someplace, I read that there is a 2 year limit on collecting a loan through the court process. I believe I also read there is a default interest rate applied if there wasn't one specified in the original loan.

 

 

[elektrified]

Hire the collectors. You know the guys which can be seen all over Thailand every morning around 8:00 riding motorcycles with the black slacks and green or black windbreakers with the logos on the back. In Bangkok sometimes you see 30 of them going down the road at once. Supposedly they are very effective. They are debt-collectors. I have no idea what their commission is but hey something is better than nothing.

 

 

[rebo]

Gave interest-free loans up to THB 100'000 and up to half a year several times, and got ALL back on time or earlier without any difficulties to Thai people from our neighbour villages (many of them members of our local cyclists group), most of them farmer families who needed new seeds after e.g. ripped off/stalled by rice millers/government or customers, or in need of urgent machine repairs to avoid loan sharks. All of them people well known for managing their family income well under "normal circumstances".
Made "contracts" by western handshake, both parties agreed clearly when to pay back the latest, and we gave the money in cash, during a dinner at our place. Always other Thai friends, knowing both parties, joined. My wife always handed out the money to the women, never to the men.
Of course this sometimes caused other people to ask for a loan, too, but it was never a problem to politely reject their attempt in case we were not 100% sure of their credibility.
Most of the loans we offered by us because we learned about a dilemma, and were not asked for.
I can't imagine to give out a loan under other circumstances than described.
 

[MyFriend You]

19 hours ago, CyclingLight said:

Having tried to reclaim a bad loan, I first went to my local police station and the officer was quite interested and willing to apply pressure until he saw that the debtor lived in another jurisdiction.

 

I went to the police where the debtor lived and the first officer took my phone to try to call the guy who owed me, but the call didn't go through and he took me to a more ranking officer, who looked at the information I presented (the loan papers and ID of the debtor). He then asked if I was gay and turned me away. Can't remember if it was him or someone else who sent me to the nearby civil court. I often wondered if I returned to that police station and got a different officer if there might have been a different answer.

 

At the civil court, I was told it could be done by going to the civil court in the province where the loan was issued (which in my case was based on my address), but that it would take a lot of time spread over months, and in the end perhaps be fruitless if the person who owes you doesn't have the money anyway. I got the impression that I could do it without a lawyer. 

 

My "local" court is quite far away and unhandy to get to, so I never followed up on the court option. 

 

I asked around, but the amount of the loan (28,500Baht) was too small for a lawyer to be involved and I so far haven't met anyone willing to collect it for me.

 

Someplace, I read that there is a 2 year limit on collecting a loan through the court process. I believe I also read there is a default interest rate applied if there wasn't one specified in the original loan.

 

 

"He then asked if I was gay and turned me away"   wonder what that had to do with it??   maybe he thought it was a lovers loan and wanted nothing to do with it, dunno, sorry for your loss.

[MyFriend You]

12 hours ago, rebo said:

Gave interest-free loans up to THB 100'000 and up to half a year several times, and got ALL back on time or earlier without any difficulties to Thai people from our neighbour villages (many of them members of our local cyclists group), most of them farmer families who needed new seeds after e.g. ripped off/stalled by rice millers/government or customers, or in need of urgent machine repairs to avoid loan sharks. All of them people well known for managing their family income well under "normal circumstances".
Made "contracts" by western handshake, both parties agreed clearly when to pay back the latest, and we gave the money in cash, during a dinner at our place. Always other Thai friends, knowing both parties, joined. My wife always handed out the money to the women, never to the men.
Of course this sometimes caused other people to ask for a loan, too, but it was never a problem to politely reject their attempt in case we were not 100% sure of their credibility.
Most of the loans we offered by us because we learned about a dilemma, and were not asked for.
I can't imagine to give out a loan under other circumstances than described.
 

     Finally someone that believes in the human kind, it pays to know who you are loaning too, my wife loans to farmers in her home province in Vietnam, nothing more than a notation in a book - they always pay back, she doesn't gauge them for 'renting money' just a little to keep them honest and shows the loan is not charity, which would embarres them.  She was visited by a loan shark once and told to stop, her three brothers and I escorted him out the gate, he never came back.

[CyclingLight]

8 hours ago, TunnelRat69 said:

"He then asked if I was gay and turned me away"   wonder what that had to do with it??   maybe he thought it was a lovers loan and wanted nothing to do with it, dunno, sorry for your loss.

 

At the time, I assumed it was because he thought it was a "lover's loan". When I wrote this post, it occurred to me that perhaps he was homophobic.  Maybe it was something else entirely.

 

Anyway, thanks for your words.

[MartinKal]

Interesting answers. Looks like noone has ever gotten to the end of a legal debt collection process.

Seems like should consider lhending a gift, or at least screen carefully and arrange big social to make for peer pressure.

Alternatively, use the alt-debt collectors. Someone mentioned seeing 30 every morning. Where is that then? In Chiang Mai? I will suggest try that but where to find them?

[khunPer]

3 hours ago, MartinKal said:

Interesting answers. Looks like noone has ever gotten to the end of a legal debt collection process.

Seems like should consider lhending a gift, or at least screen carefully and arrange big social to make for peer pressure.

Alternatively, use the alt-debt collectors. Someone mentioned seeing 30 every morning. Where is that then? In Chiang Mai? I will suggest try that but where to find them?

If you read post #11 again, you'll will see at least one (me) who had got to the end with a legal debt collection...
 

Quote

The good news is, that a foreigner can sue a Thai with success for a financial debt if the paperwork is clear and in accordance with the rules (I talk from positive experience)...

 

[MartinKal]

Khun Per. How to contact you privately?

[MartinKal]

On 04/09/2017 at 0:03 PM, khunPer said:

I don't think you can go to Court without a Thai lawyer.

 

Benjawan Poomsan Becker and Roengsak Thongkaew says in the book "Thai Law for Foreigners" (ISBN 978-1-887521-57-4) on page 27:

 

»Unless you are a court officer or work in the legal profession, you don't want to go to court in Thailand. Thais consider going to court, or having matters that require them to go to court, to be bad luck...«

and:

»You can go to court as a plaintiff in either a criminal or civil case. For criminal matters, the prosecutor is your representative, and for civil matters, you will be represented by a private lawyer...«

 

Just using a lawyer that states in his letters to debitor, that he will bring the case to the Court, may result in some level of debt collection or payment plan, depending of size of debt; and of course that the paperwork is in order and within the law (for example interest rate charged, if any).

 

A Thai lawyer will normally give a price for the full case and ask for an advance, before he writes the first letter. If he is going to do further, he may want the full payment up front, plus Court fees (which will be returned, if you win the case). Sometimes it's possible to make a agreement before a Court meeting, but ask the lawyer to have the agreement fulfilled in the Court in front of the judge, as it will then be a binding agreement. If no payment is received, agreement or not, you can consider to take possession of property, but you, or your lawyer's office, will need to find out what can be processed (which might cost you extra fees to look up).

 

The good news is, that a foreigner can sue a Thai with success for a financial debt if the paperwork is clear and in accordance with the rules (I talk from positive experience); the bad news is, that when some Thai lawyers have been prepaid, they will work extremely slow (not much interest in the case, any longer, however an extra tip, like offering some level of transport compensation for a Court meeting, can speed up the process again).

 

Wish you good luck...

 

EDIT: I should add, that a Thai lawyer, and a judge in the Court, may offer debitor a discount to settle the case, or make a "binding" payment plan; further compensation for your expenses to lawyer etc. may not be included. But talk to the lawyer about, what is possible in your case.

Thankyou for the down-to-earth  review. I am trying to contact you privately...

[sendintheclowns]

On 9/4/2017 at 12:26 PM, ubonjoe said:

A off topic post meant to derail the topic has been removed.

is there an active forum thread, about DIY claims under the Consumer Protection Act, and/or The Small Claims Court? Thanks 

Edited February 28, 2018 by sendintheclowns
spelling

[Gumballl]

I always think of worse case scenarios (in a banana republic, similar to Thailand).

Is it worth it to point out another's faults... for example, "hey, you owe me money!'

The answer could include one of the following:

1. Person pays you immediately
2. You take person to court, and after favorable judgement they pay you
3. You are found dead the next morning.

Jeez, I do not speak Thai, nor do I know a person in Thailand willing to take a bullet or knife wound for me. I would go with option 4... cut my losses.

[HaleySabai]

On 9/4/2017 at 9:11 AM, phantomfiddler said:

Unfortunately the Thai courts do not enforce the decision, even though they will probably rule entirely in your favour. Unless it is a sizable sum best to just learn and forget it. An alternative would be to promise a policeman a decent percentage if he can make that person pay up. Thai policemen do have considerable sway over us, especially when there is motivation :)

.....you've heard about those two 'men in black' that ride around on scooters wearing full faced helmets?...yup, guess who they work for....

[luther]

On 9/4/2017 at 12:23 PM, Global Guy said:

Overall, the rule of law in Thailand for foreigners, in my opinion, is nonexistent. It's zero. There may be some charade of rule of law, (with some exceptions thrown in) but in the end, it's just that...a theater designed to look like a legal system for expats.

I don't know about collecting debts, but a small group of farang friends working in Thailand sued for severance pay, won, and collected well over ½ a million US dollars. The case with appeals took 6 years and was eventually settled in the supreme court. The lawyers involved took less than 2 percent of the settlement. That's not a typo.