Loan Sharks - Chanote Collateral

[Tomahawk21]

2 hours ago, Luca Brasi said:

Final update on this as after meeting the lawyer (actually a barrister), I've got a path towards resolution. Thanks for all the replies.

 

For any future readers in a similar situation, please note:

 

- Overcharging interest rate in Thailand is a criminal offence  even if you sign for it! In our case, the lawyer confirmed the "loan" contract my wife signed is null and void. 

 

- The monthly repayments to the loan sharks were made through bank transfers. So we've now got the 3 years statements from my wife bank account that shows we repaid more than the principal amount. The lawyer mentioned that if only cash payment was made, our case would have been more complicated.

 

 - The most important: our house chanote is a Nor Sor 4 . She basically gave the chanote as collateral but didn't sign anything over it. In any case, the lawyer confirmed the followings:

 

        . Loan sharks can't claim ownership of anything just because they have a house chanote. Chanote ownership transfer must be done at the Land Office with an officer overseeing the transaction.

 

        . Unlicensed money lenders cannot attach a mortgage to a house chanote, specially when the contract they made is illegal due to overcharging interest rate (see first point).

 

        . The fact that one of our child is a joint owner on the chanote simply means it's impossible to transfer ownership / sell a house without a Children's Court order.

 

So finally, my lawyer confirmed this is a very common case in Thailand as other posters mentioned and from his experience, this gets resolved through private settlement, without going to court.

 

In our particular case, the lawyer will enter in contact with the lenders to signify them that:

 

     - Their loan contract is illegal.

     - They have no ownership claim on the house.

     - The principal amount was already repaid, including the maximum legal interest rate ( 15% per year)

     - They must return the chanote and stop asking for payments.

     - If they don't agree to the above, we'll go to court and they risk a jail sentence.

 

great news for you, i hope you both live long enough to enjoy the rest of your lives you have left. these mafia loan sharks dont take to kindly to some clever dick going to a lawyer or police. good luck anyway.

[BEVUP]

Good news

Very lucky your wife put the child on the Chanote (this clarifies type & fully paid for ). The Loan Sharks knew they couldn't register at Amphur otherwise the house would of by now had an eviction paper glued to the front door - needing courts approval ( & they don't worry about usufruts - hoping falang will pay out ) 

Wife lost a house with me still on it

 

I got wife to do this to prevent a re-event (inlaws always swarming )

I also notice they go 50/50 on Chanote incase kids go AWALL 

 

 

 

 

[DingDongLing]

On 5/21/2019 at 3:55 AM, Tomahawk21 said:

great news for you, i hope you both live long enough to enjoy the rest of your lives you have left. these mafia loan sharks dont take to kindly to some clever dick going to a lawyer or police. good luck anyway.

Hopefully he is still alive.  How did they take it? 

[baansgr]

On 5/21/2019 at 1:46 PM, Luca Brasi said:

Final update on this as after meeting the lawyer (actually a barrister), I've got a path towards resolution. Thanks for all the replies.

 

For any future readers in a similar situation, please note:

 

- Overcharging interest rate in Thailand is a criminal offence  even if you sign for it! In our case, the lawyer confirmed the "loan" contract my wife signed is null and void. 

 

- The monthly repayments to the loan sharks were made through bank transfers. So we've now got the 3 years statements from my wife bank account that shows we repaid more than the principal amount. The lawyer mentioned that if only cash payment was made, our case would have been more complicated.

 

 - The most important: our house chanote is a Nor Sor 4 . She basically gave the chanote as collateral but didn't sign anything over it. In any case, the lawyer confirmed the followings:

 

        . Loan sharks can't claim ownership of anything just because they have a house chanote. Chanote ownership transfer must be done at the Land Office with an officer overseeing the transaction.

 

        . Unlicensed money lenders cannot attach a mortgage to a house chanote, specially when the contract they made is illegal due to overcharging interest rate (see first point).

 

        . The fact that one of our child is a joint owner on the chanote simply means it's impossible to transfer ownership / sell a house without a Children's Court order.

 

So finally, my lawyer confirmed this is a very common case in Thailand as other posters mentioned and from his experience, this gets resolved through private settlement, without going to court.

 

In our particular case, the lawyer will enter in contact with the lenders to signify them that:

 

     - Their loan contract is illegal.

     - They have no ownership claim on the house.

     - The principal amount was already repaid, including the maximum legal interest rate ( 15% per year)

     - They must return the chanote and stop asking for payments.

     - If they don't agree to the above, we'll go to court and they risk a jail sentence.

 

Good you can get it sorted, trust the lawyers fees are only a few thousand baht and not 30 or 40k

[Henryford]

What good is the lawyer winning your case if the mafia break your legs?

[SteveK]

In Thailand, if you take out a loan with no intention of ever making a payment, and trying to do a runner, is that not a criminal offence and/or fraud?

 

 

[Luca Brasi]

The lender finally accepted a settlement after we passed him the lawyer notice and a couple of days of negotiation.

 

What I understood from the lawyer is very often the lender is not alone and he's usually part of a syndicate ( couple of people join their funds together and start lending to other people at exorbitant interest rates).

 

So basically we paid a "face saving" fee so the lender could not lose face with his associates (my wife's sister paid 100,000 THB and I paid 50,000 THB) and avoided the hassle of going to court and potential retaliation to us.

 

Including the laywer fee (15,000 THB), the damage is "reasonable" compared to the potential outcome of getting the loan shark syndicate in trouble with desire of revenge.

 

At least, we've now got the chanote back and it's in a safe place out of reach from my wife. Case closed.

 

 

[baansgr]

Good its finished. Lesson here for members, 130% plus initial loan over three years, thats over 40% interest a year way way above  legal interest rates even when a lawyer gets involved which for their fee seems extorinate also. Dont buy anything in Thai names. Rent property and vehicles can be in Foreign name easily.