Finance Company Chasing Payment

[TheRascal]

A friend of mine acted as a guarantor on a motorbike purchase for a friend around 10 years ago. They are no longer in contact and the finance company have now appeared chasing 36k from my friend. 

 

Is there any course of action that can be taken, anyone have experience of this. What happens if my friend refuses to pay as this amount of money just isn't available to their family. 

[AlexRRR]

10 years ago you say....looks like the interest has been adding up, negotiate with the finance company, not a lot your buddy can do, id be asking lots of questions and of course the lesson is never go guarantor for anyone.

[TheRascal]

Yeah definitely, not the first time I've heard of this situation. People are way too trusting here. 

[jeab1980]

Ten years! Sounds like a scam to me. Tell him to do what the Thai's do and file any letters under bin. 

[scorecard]

35 minutes ago, AlexRRR said:

10 years ago you say....looks like the interest has been adding up, negotiate with the finance company, not a lot your buddy can do, id be asking lots of questions and of course the lesson is never go guarantor for anyone.

 

How true and I share an example:

 

I have educated my Thai son (now 36 yo) to enjoy life and to be wary of life.  When he started university his buddies quickly realized that his family name was a typical farang name, and quickly the requests for loans and 'ask your father to sign to be guarantor' started, especially for motor cycles.

 

He agreed to the first request for a loan (from memory 5,000Baht) because 'hes a good friend, he's a nice guy' and he took the money from his own bank account. Maybe 18 months later zero repayments and son asked the same boy 'when are you going to start to repay the money I loaned you?' Response: 'If your going to ask for the money back your not a nice friend' and the receiver of the funds never spoke to my son again and avoided him. Further, my son had now realized that the 'nice friend' wanted the money to pay off football gambling debts, therefore a cycle which will probably never end. 

 

Meanwhile other uni friends had prompted / pushed my son to not loan money, saying 'you will never be repaid regardless of what your family name is'.

 

My son is now a successful professional person, same requests still role in, but he's learned to make comments like:  

 

'Actually I have an idea for a successful business selling som tum, will bring revenue of at least 5MBaht a month with very little work, you want to join my idea, just give me 1MBaht to join the business.'

 

Silence. 

 

Also, his Thai in-laws have asked many times for loans and, when he was old enough to sign as guarantor. His response:

 

- 'I have no cash, all my money goes into a fund for good education for my kids and I'm sure you don't want me to touch it'.

 

or

 

- Sorry but people with farang names cannot be a guarantor in Thailand.

(Not totally true, but never mind.) 

 

 

 

Edited September 6, 2017 by scorecard

[ukrules]

The guarantor should chase down the person who originally borrowed the money and extract it from them because if they don't they will end up paying. It will go to court and property could be seized.

 

 

[paul18620]

2 hours ago, scorecard said:

 

How true and I share an example:

 

I have educated my Thai son (now 36 yo) to enjoy life and to be wary of life.  When he started university his buddies quickly realized that his family name was a typical farang name, and quickly the requests for loans and 'ask your father to sign to be guarantor' started, especially for motor cycles.

 

He agreed to the first request for a loan (from memory 5,000Baht) because 'hes a good friend, he's a nice guy' and he took the money from his own bank account. Maybe 18 months later zero repayments and son asked the same boy 'when are you going to start to repay the money I loaned you?' Response: 'If your going to ask for the money back your not a nice friend' and the receiver of the funds never spoke to my son again and avoided him. Further, my son had now realized that the 'nice friend' wanted the money to pay off football gambling debts, therefore a cycle which will probably never end. 

 

Meanwhile other uni friends had prompted / pushed my son to not loan money, saying 'you will never be repaid regardless of what your family name is'.

 

My son is now a successful professional person, same requests still role in, but he's learned to make comments like:  

 

'Actually I have an idea for a successful business selling som tum, will bring revenue of at least 5MBaht a month with very little work, you want to join my idea, just give me 1MBaht to join the business.'

 

Silence. 

 

Also, his Thai in-laws have asked many times for loans and, when he was old enough to sign as guarantor. His response:

 

- 'I have no cash, all my money goes into a fund for good education for my kids and I'm sure you don't want me to touch it'.

 

or

 

- Sorry but people with farang names cannot be a guarantor in Thailand.

(Not totally true, but never mind.) 

 

 

 

And what is your sons professional scope of work ,,,since you don't mention it as would be interesting to add this to the story ?

[1FinickyOne]

Being a guarantor means your friend guaranteed that he would pay... surely he understood what it meant, right? It is usually a thankless position to be in, but he had to choose this of his own free will... usually, if you make business decisions that you cannot benefit from but only lose money, eventually you will lose money - 

 

I assume what will happen is that your friend will be called upon to honor the agreement he made. 

[dotpoom]

The way the question is put seems to suggest that the OP feels that the guarantor shouldn't be held responsible......why so?

 

 

 

 

[TheRascal]

4 minutes ago, dotpoom said:

The way the question is put seems to suggest that the OP feels that the guarantor shouldn't be held responsible......why so?

 

 

 

 

Nope, nothing to suggest I think that the guarantor shouldn't be held responsible or whether I think they should or should not pay - just asking if anyone had a similar experience. Don't try to read between the lines. 

[scorecard]

35 minutes ago, paul18620 said:

And what is your sons professional scope of work ,,,since you don't mention it as would be interesting to add this to the story ?

 

He's not a lawyer.

[Rc2702]

1 hour ago, scorecard said:

 

How true and I share an example:

 

I have educated my Thai son (now 36 yo) to enjoy life and to be wary of life.  When he started university his buddies quickly realized that his family name was a typical farang name, and quickly the requests for loans and 'ask your father to sign to be guarantor' started, especially for motor cycles.

 

He agreed to the first request for a loan (from memory 5,000Baht) because 'hes a good friend, he's a nice guy' and he took the money from his own bank account. Maybe 18 months later zero repayments and son asked the same boy 'when are you going to start to repay the money I loaned you?' Response: 'If your going to ask for the money back your not a nice friend' and the receiver of the funds never spoke to my son again and avoided him. Further, my son had now realized that the 'nice friend' wanted the money to pay off football gambling debts, therefore a cycle which will probably never end. 

 

Meanwhile other uni friends had prompted / pushed my son to not loan money, saying 'you will never be repaid regardless of what your family name is'.

 

My son is now a successful professional person, same requests still role in, but he's learned to make comments like:  

 

'Actually I have an idea for a successful business selling som tum, will bring revenue of at least 5MBaht a month with very little work, you want to join my idea, just give me 1MBaht to join the business.'

 

Silence. 

 

Also, his Thai in-laws have asked many times for loans and, when he was old enough to sign as guarantor. His response:

 

- 'I have no cash, all my money goes into a fund for good education for my kids and I'm sure you don't want me to touch it'.

 

or

 

- Sorry but people with farang names cannot be a guarantor in Thailand.

(Not totally true, but never mind.) 

 

 

 

Great counters. The 5000 baht loan was money well spent. Bargain.

[bazza73]

Best option is to chase up the "friend" and extract the money from him. Your friend is legally liable, if the finance company has a document with his signature on it.

[csabo]

Thais think loans are gifts. I have never heard of one loan or guarantor situation going well here.  Even small things like at the wife's salon "Oh can I pay you tomorrow??" Gone.  And that person/friend/customer will never go to the salon again over 100 baht.  Which means several things 1.They know they owe you the money 2. They have no intension of paying 3. Their relationship with you was worth less than 100 baht.  I would never EVER lend a Thai money or be a guarantor unless I never wanted to see that money or that person again.  If my wife needs cash no problem but she is under strict orders to never ever lend any of my money out and if she lends her own I don't want to hear one word about it and that includes family.

[HHTel]

My wife was guarantor for a family member buying a motorbike many years ago in Lopburi.  A couple of years ago, an agent of the company turned up in Hua Hin.  They'd gone to the trouble of tracing the guarantor rather than the guy with the bike.  The family member has since 'disappeared'.  She had no option but to pay the man.  i.e. she was responsible for the debt.  No question.

[anono222]

Have to counter the NEVER go well here stuff.  I personally loaned a Thai family member 200,000 Baht to buy a used car when she graduated from University.  I went into the agreement knowing I may not see a dime, but she has paid me faithfully as agreed.  Next month is her last payment which I intend to give back to her in appreciation for her hard work and dedication to doing the right thing.

[BEVUP]

9 hours ago, csabo said:

Thais think loans are gifts. I have never heard of one loan or guarantor situation going well here.  Even small things like at the wife's salon "Oh can I pay you tomorrow??" Gone.  And that person/friend/customer will never go to the salon again over 100 baht.  Which means several things 1.They know they owe you the money 2. They have no intension of paying 3. Their relationship with you was worth less than 100 baht.  I would never EVER lend a Thai money or be a guarantor unless I never wanted to see that money or that person again.  If my wife needs cash no problem but she is under strict orders to never ever lend any of my money out and if she lends her own I don't want to hear one word about it and that includes family.

How true & few posters on the forum wouldn't realise that their wives give to their well of families 

[BEVUP]

13 hours ago, scorecard said:

 

How true and I share an example:

 

I have educated my Thai son (now 36 yo) to enjoy life and to be wary of life.  When he started university his buddies quickly realized that his family name was a typical farang name, and quickly the requests for loans and 'ask your father to sign to be guarantor' started, especially for motor cycles.

 

He agreed to the first request for a loan (from memory 5,000Baht) because 'hes a good friend, he's a nice guy' and he took the money from his own bank account. Maybe 18 months later zero repayments and son asked the same boy 'when are you going to start to repay the money I loaned you?' Response: 'If your going to ask for the money back your not a nice friend' and the receiver of the funds never spoke to my son again and avoided him. Further, my son had now realized that the 'nice friend' wanted the money to pay off football gambling debts, therefore a cycle which will probably never end. 

 

Meanwhile other uni friends had prompted / pushed my son to not loan money, saying 'you will never be repaid regardless of what your family name is'.

 

My son is now a successful professional person, same requests still role in, but he's learned to make comments like:  

 

'Actually I have an idea for a successful business selling som tum, will bring revenue of at least 5MBaht a month with very little work, you want to join my idea, just give me 1MBaht to join the business.'

 

Silence. 

 

Also, his Thai in-laws have asked many times for loans and, when he was old enough to sign as guarantor. His response:

 

- 'I have no cash, all my money goes into a fund for good education for my kids and I'm sure you don't want me to touch it'.

 

or

 

- Sorry but people with farang names cannot be a guarantor in Thailand.

(Not totally true, but never mind.) 

 

 

 

Good one , & yes it never stops with being asked or pressured, sin most of them couldn't manage a f&*%k in a br*#hel

[mfd101]

17 minutes ago, Jiggyfly said:

Have to counter the NEVER go well here stuff.  I personally loaned a Thai family member 200,000 Baht to buy a used car when she graduated from University.  I went into the agreement knowing I may not see a dime, but she has paid me faithfully as agreed.  Next month is her last payment which I intend to give back to her in appreciation for her hard work and dedication to doing the right thing.

Yes, that is my experience too. I give money regularly to some members of my Thai family who work hard & are deserving. The money is a gift. I have also loaned larger amounts (20K, 30K) to other members of the family for nice-to-have purchases -  a new motorbike on 2 occasions - and each time I have been explicit that the money is to be repaid. And it has been, not always quite  'on time' but at Thai speed. And that's fine by me.

[meatboy]

10 hours ago, bazza73 said:

Best option is to chase up the "friend" and extract the money from him. Your friend is legally liable, if the finance company has a document with his signature on it.

if its a finance co they must produce the document with his signature on it,plus a record of what his friend borrowed and what has been paid back.

do the finance co have a contact address for him,and also a document showing your signature and you agreeing to cover the loan.

if you agreed to cover the loan as the guarantor then you are liable.

pay it so it keeps the boys in black from making an unexpected visit. 

[bofhman]

1. Who is doing the chasing? The company you have a contract with or a third party collection agency that has purchased the debt. If the latter, ask them to prove their claim with your wet sigature on their contract. If cannot and they persist get a lawyer and sue them for tort.

 

2. There is a time limitation as to debt collection. It is seven years after term expiration. Again, rinse, wash repeat step 1.

 

Good luck.

[csabo]

1 hour ago, BEVUP said:

How true & few posters on the forum wouldn't realise that their wives give to their well of families 

My wife's dad was a dead beat after her mom died.  She went to live with her grandmother and then her uncle took her in after grandma died because dad still didn't want her or her sister (who was shipped off to other family).  After he got wind she was with me the phone started ringing.  "Kids are supposed to take care of their parents blah blah blah"  Can you believe the balls on this son of a bitch??  Fortunately my wife and I are in total agreement on this low life.  I told her if the uncle who raised her needs anything to let me know.  He has never asked her for a thing.

Edited September 7, 2017 by csabo

[opalred]

my wife's best friend /couldn't get credit to buy a pickup

being wife's best friend for 45years  put pickup in her name

the friend payed payments for 9mnths /then stopped

finance company sued my wife 

went to court told her story but court ordered her to pay 

friend sold pickup to chop chop shop and told police knew nothing about it

wife has to make payments for years 260000b to pay 

so don't go guarantor  or give money to no one 

[TheRascal]

That sucks opalred. 

 

How much room to negotiate with finance companies is there here? I know that in the UK if someone is incapable of paying a debt they can go into an arrangement with the company that they will pay a small amount each month until it's settled. This person has nothing the finance company can take, no property or vehicles and a small salary without much left over at all. 

 

 

[BEVUP]

2 hours ago, opalred said:

my wife's best friend /couldn't get credit to buy a pickup

being wife's best friend for 45years  put pickup in her name

the friend payed payments for 9mnths /then stopped

finance company sued my wife 

went to court told her story but court ordered her to pay 

friend sold pickup to chop chop shop and told police knew nothing about it

wife has to make payments for years 260000b to pay 

so don't go guarantor  or give money to no one 

Same here , but wife was helping family ( it's all the mai pen rai attitude ) thinking theirs no way a family member/ best friend will stuff it up HOW WRONG THEY ARE

This is exactly why the Loan Companies wont give them credit ( as they even couldn't bullshit to them )

IE : Woman down the street used several banks to buy a house - Go figure (she asked wife how many we used)

Because like said after 9 mths stopped paying & don,t even bother to tell you because it all got to difficult 

[cyberfarang]

20 hours ago, TheRascal said:

Nope, nothing to suggest I think that the guarantor shouldn't be held responsible or whether I think they should or should not pay - just asking if anyone had a similar experience. Don't try to read between the lines. 

Nothing to do with having experience. Being a guarantor means being responsible for payments if the debtor defaults on the payments. It`s not rocket science understanding that one.

 

Two things in life to avoid. Don`t lend money and don`t be a guarantor, it`s a mugs game.

 

 

[flashpanther]

The Thai law changed nearly 2 years ago giving protection to guarantors  (khamprakans). Basically making them ineffective. Unless the finance company has exhausted all efforts to reclaim the money from the loanee I. E. Taken them to court. Liquidated any assets they have such as a home and reclaimed the motorbike... they can not even approach the guarantor. Don't know if this only applies to loans taken out after the new law put in place or affected previous loans such as this one though. If so the finance company should be told to go away in no uncertain terms or issue you a court summons.

[impulse]

2 hours ago, cyberfarang said:

Nothing to do with having experience. Being a guarantor means being responsible for payments if the debtor defaults on the payments. It`s not rocket science understanding that one.

 

Two things in life to avoid. Don`t lend money and don`t be a guarantor, it`s a mugs game.

 

Though that's true, it's a pretty simplistic view.  There are laws limiting what (and who) a finance company can come after, how long they have to do it, and what documents they need to have to legitimize a claim.  Collection agencies all over the world are notorious for using illegal and strong arm tactics to collect debts that people may not even owe- having already paid them off or long past the statute of limitations.

 

Armchair lawyering has gotten a lot of people deeper into trouble, or caused them to lose sleep over nothing.  Not to mention losing tax advantages they were due if they did have a loss- though I doubt that's much of an issue in LOS.

 

Rather than ask people who have a vague recollection of how it worked back home, or what happened to a family member (under a previous government, no less) whose situation may have been totally different, get some legal advice from a paid professional.

 

Edited September 7, 2017 by impulse

[Rc2702]

Just now, flashpanther said:

The Thai law changed nearly 2 years ago giving protection to guarantors  (khamprakans). Basically making them ineffective. Unless the finance company has exhausted all efforts to reclaim the money from the loanee I. E. Taken them to court. Liquidated any assets they have such as a home and reclaimed the motorbike... they can not even approach the guarantor. Don't know if this only applies to loans taken out after the new law put in place or affected previous loans such as this one though. If so the finance company should be told to go away in no uncertain terms or issue you a court summons.

This sounds very certain. I like the sound of this one.

[Thongkorn]

Ask to see the original agreement, and contract.