Question for those with legal knowledge.

[CallumWK]

I own a piece of land with a house on it. Yes, I know I can't own land in Thailand, so let the pedants please give this topic a miss.

 

The land is registered in the name of a long time Thai friend, and has a mortgage in my name registered on the back of the title deed.

 

The friend in question also owns a house in a moobaan, and is behind on the payments. She just informed me that she received a letter from the bank that they will foreclose if she doesn't pay within the next 60 days. I think she is 150.000 baht behind in payments, but not sure how much she owes the bank in total. She lives in that house for about 15 years, I think.

 

So the question is, what are the risks for my property if they foreclose on her house?

[Delight]

 

The land is not yours

Edited July 30 by Delight

[CallumWK]

15 minutes ago, Delight said:

 

The land is not yours

 

Please go away

 

3 hours ago, CallumWK said:

Yes, I know I can't own land in Thailand, so let the pedants please give this topic a miss.

 

[BobBKK]

Huh? You lose it?  it's not pedantic to tell you the truth - good luck anyway, and find a good lawyer ASAP

[john donson]

no 30 year lease, no usufruct...  zilch you own

[CanadaSam]

Finding out how much she owes the bank, and then of-course how much her own house is worth, would be a sensible first step.

 

If the bank can be repaid by taking over her own house and selling it, there is no danger to your property, obviously.

[CallumWK]

9 minutes ago, CanadaSam said:

Finding out how much she owes the bank, and then of-course how much her own house is worth, would be a sensible first step.

 

If the bank can be repaid by taking over her own house and selling it, there is no danger to your property, obviously.

 

Thanks, I plan to visit her today and find out. You think that even if the bank can not recover by selling her house, they can touch land that has a mortgage registered on it?

[CallumWK]

18 minutes ago, john donson said:

no 30 year lease, no usufruct...  zilch you own

 

You have reading issue John? Didn't you see that it made clear in the OP that I am very well aware of the fact that I don't own the land? So why you feel you need to repeat it.

 

But it is clear that you are not the brightest light in the shed, if you think that a lease or usufruct would mean you own it

 

 

[CanadaSam]

6 minutes ago, CallumWK said:

even if the bank can not recover by selling her house, they can touch land that has a mortgage registered on it?

 

This is where you need a Thai lawyer, because in many countries, it is not the first mortgage that is more powerful, but a mortgage to a bank which is.

 

In other words, even if a bank registers their mortgage third or fourth after previous mortgages to private parties, the bank's mortgage gets precedence, strange, innit?

[CallumWK]

6 minutes ago, CanadaSam said:

 

This is where you need a Thai lawyer, because in many countries, it is not the first mortgage that is more powerful, but a mortgage to a bank which is.

 

In other words, even if a bank registers their mortgage third or fourth after previous mortgages to private parties, the bank's mortgage gets precedence, strange, innit?

 

Not sure if something was lost in translation.

 

We talk about 2 separate properties.

 

The bank has a mortgage on the house where she lives only. On the land where I live, I'm the only one who has a mortgage, bank was never involved

[OneMoreFarang]

I guess this is not what you want to hear, but did you consider that she might sell "your" land so that she gets some money to keep her own house where she lives? Or she might refinance "your" land and make a deal with the bank(s).

 

[CallumWK]

3 minutes ago, OneMoreFarang said:

I guess this is not what you want to hear, but did you consider that she might sell "your" land so that she gets some money to keep her own house where she lives? Or she might refinance "your" land and make a deal with the bank(s).

 

 

She can not sell the land with a mortgage registered on the back. She can't even lease it or whatever

[Berkshire]

23 minutes ago, CallumWK said:

 

The bank has a mortgage on the house where she lives only. On the land where I live, I'm the only one who has a mortgage, bank was never involved

A tad confusing.  So the land that you live on you hold a mortgage....which is to say you got a loan from a bank.  But a bank was never involved?  Just not clear what you mean when you say you have a mortgage on your land. 

[Liverpool Lou]

40 minutes ago, CallumWK said:

You think that even if the bank can not recover by selling her house, they can touch land that has a mortgage registered on it?

"...think they can touch land that has a mortgage registered on it?

Only in the event of making her bankrupt and going after any assets she has.  If a court ordered liquidation of her assets to repay creditors 'your' property would be sold, the mortgage to you paid off and the balance distributed to her creditors.

[CallumWK]

1 minute ago, Berkshire said:

A tad confusing.  So the land that you live on you hold a mortgage....which is to say you got a loan from a bank.  But a bank was never involved?  Just not clear what you mean when you say you have a mortgage on your land. 

 

No, the lady took a mortgage from me, which was all drawn up by a lawyer, and registered at the land department. So my name is on the back of the land title as the mortgagee.

Land title is also in my possession, and don't get your thoughts in a twist.

I know the lady for 30 years and trust her 100%. If she had bad intentions, she would also not have informed me about the possible repossession of her house

[Liverpool Lou]

41 minutes ago, CanadaSam said:

even if a bank registers their mortgage third or fourth after previous mortgages to private parties, the bank's mortgage gets precedence, strange, innit?

That is not the situation here, there are two different properties owned by her, one mortgaged only to the bank and the other mortgaged only to the OP.

[Liverpool Lou]

9 minutes ago, Berkshire said:

A tad confusing.  So the land that you live on you hold a mortgage....which is to say you got a loan from a bank.  But a bank was never involved?  Just not clear what you mean when you say you have a mortgage on your land. 

Banks are not the only entities that can issue mortgages.  The OP has issued one on 'his' land.

[Berkshire]

Just now, CallumWK said:

 

No, the lady took a mortgage from me, which was all drawn up by a lawyer, and registered at the land department. So my name is on the back of the land title as the mortgagee.

Land title is also in my possession, and don't get your thoughts in a twist.

I know the lady for 30 years and trust her 100%. If she had bad intentions, she would also not have informed me about the possible repossession of her house

Ah, I see.  So since she holds the mortgage, she technically owns your house (like a bank would).  In theory, you should be safe.  But if your friend is in a difficult financial situation....hmmmm.   Falling behind in payments to the tune of 150k....not good.  If she starts getting desperate, not sure what she would do.  The land with your house on it....could be worth quite a bit.  You might get your own lawyer to look over that mortgage to see if there's something in the fine print.  She may have told you about the "possible repossession of her house" to justify any future harsh measures she may take. 

[CallumWK]

6 minutes ago, Berkshire said:

Ah, I see.  So since she holds the mortgage, she technically owns your house (like a bank would).  In theory, you should be safe.  But if your friend is in a difficult financial situation....hmmmm.   Falling behind in payments to the tune of 150k....not good.  If she starts getting desperate, not sure what she would do.  The land with your house on it....could be worth quite a bit.  You might get your own lawyer to look over that mortgage to see if there's something in the fine print.  She may have told you about the "possible repossession of her house" to justify any future harsh measures she may take. 

 

The mortgage has been drawn up by MY lawyer obviously, so there is no fine print. She owns the land per definition, AFTER she paid off the mortgage, which is much higher than the value of her house.

The house on the land is owned by me, since the building license and all contracts are in my name.

And I told you already not to get your thoughts in a twist, so better stop with the conspiracy theories

[JBChiangRai]

There are a few issues here.

 

First, what is the value of your land? and how big is the mortgage?

 

If she has significant equity in your land/house, the bank may insist it is sold and your loan would repaid to you and the bank would take what was left over.  Assuming they were to pursue her for the debt.

 

The other issue is "intention".  If your intention in constructing this kind of arrangement was so you could circumvent the law and own the land/house then the whole agreement is illegal and your risk is to lose everything.

 

If they start to look at her closely, they will want to see some repayments from her to you, I think you need some legal advice.

 

There is another reason why I think you need legal advice, to offer a mortgage you have to have a licence, I hope your agreement couches it in words that mean you didn't need a licence.

[CallumWK]

1 minute ago, JBChiangRai said:

There is another reason why I think you need legal advice, to offer a mortgage you have to have a licence

 

You are wrong. For sure a lawyer would have been aware of that, as would be the land department. So if the mortgage was not legal, the land department would not accepted the registration

[Berkshire]

9 minutes ago, CallumWK said:

 

The mortgage has been drawn up by MY lawyer obviously, so there is no fine print. She owns the land per definition, AFTER she paid off the mortgage, which is much higher than the value of her house.

The house on the land is owned by me, since the building license and all contracts are in my name.

And I told you already not to get your thoughts in a twist, so better stop with the conspiracy theories

I'm sympathetic to your situation, not trying to come up with conspiracy theories.  The fact that you started this thread means you are a tad concerned.  Your friend is behind on 150k of payments, which means she's in a desperate financial situation.  It's not a stretch to suggest that she may employ desperate measures. 

[JBChiangRai]

2 minutes ago, CallumWK said:

 

You are wrong. For sure a lawyer would have been aware of that, as would be the land department. So if the mortgage was not legal, the land department would not accepted the registration

 

My experience with Thai lawyers is that in most cases they don't know the law and thus far, in all cases, they cannot be trusted.  I hope your lawyer did not use the word "mortgage" (in Thai obviously).

 

I am not wrong btw, my business builds entire housing estates. There are ways to own land & houses legally, but "intention" is the issue.  If your intention is to circumvent the land ownership law then it's not legal.  If company ownership comes as a benefit to an unrelated intention, then it may be legal.

 

Putting it another way, if you create a company to buy land, then it's illegal.  If your company's intention is something else, and by way of delivering that something else it has to own land, that is different.

 

Incidentally, you don't own the house because your building contracts, building permits, payments etc are in your name.  You also have to have a contract with the land owner agreeing that you can build and will own the house.  The concept in law, is that the land owner owns everything built on the land unless it is specified contractually.

 

In any event, I think you need legal advice and I would take it from a different lawyer.

[BakedPanda]

The OP is ignorant enough to think he owns the land, which he don't, so the bank goes after all assets necessary, to pay back what she owes them. If what she has (like that house or other assets) aren't enough, you can be pretty much guaranteed sure that her land, that you think is your land, will be next. That is also the end of the story, there is nothing complex about this to understand. Even you might be allowed to still live there based on whatever, that would then be with the bank now as your new land owner.

Edited July 30 by BakedPanda

[JBChiangRai]

You wouldn't have any of these problems if you owned an EV Callum (wink wink)

[Unamerican]

2 hours ago, CanadaSam said:

 

This is where you need a Thai lawyer, because in many countries, it is not the first mortgage that is more powerful, but a mortgage to a bank which is.

 

In other words, even if a bank registers their mortgage third or fourth after previous mortgages to private parties, the bank's mortgage gets precedence, strange, innit?

Are you sure about this? 

[Hamus Yaigh]

6 hours ago, CallumWK said:

So the question is, what are the risks for my property if they foreclose on her house?

You would have to ask her.

[CanadaSam]

9 minutes ago, Hamus Yaigh said:

You would have to ask her.

 

He is asking for legal advice.  How would a Thai woman living in the boonies know about Thai law?

 

Liverpool Lou got it correct, (by saying pretty much what I said about banks having preferences on outstanding debts including mortgages) after the bank forecloses on her own house, and if there is still money owing, they can go after his house (because the land is owned by her).

[Lacessit]

1 hour ago, JBChiangRai said:

You wouldn't have any of these problems if you owned an EV Callum (wink wink)

Actually, I agree with you he needs a lawyer to explain his rights in a complex arrangement.

 

Are you going to inject EV partisanship into completely unrelated threads? I didn't know the electric Jesus movement had its own Billy Graham.

[JBChiangRai]

36 minutes ago, Lacessit said:

Actually, I agree with you he needs a lawyer to explain his rights in a complex arrangement.

 

Are you going to inject EV partisanship into completely unrelated threads? I didn't know the electric Jesus movement had its own Billy Graham.

 

Not normally no, but for Callum, I make an exception, knowing how he loves EV's.