Deposit Payments Please Read

[MTS]

I recently made inquires with regards to a OFF PLAN freehold 2bed condo in Hua Hin 3.5m THB,which is due to complete in June/July 2009.

I was told and it's on the contract that installments payments which is to be paid monthly must be paid to the construction companies bank account.

I feel uncomfortable with this arrangement base on the points below.

1. What if the construction company goes under base on todays financial situation,I mean big establish banks and companies are folding down at short notice.

2. What if the MD of the construction company gets eliminated for what ever reason,we all know what happen to an property developer in Phuket few days ago.

For eg: in he UK the system works very different.

All deposit funds are paid to MY solicitor--- my solicitor transfers the funds to the construction company/builders solicitor,and until completion the money stays with the builders solicitor and he or she is responsible and liable.

So even if the constraction company goes under (which lot of them are these days) your deposit money will be safe.

I wonder if anyone out there has had similar experience,if so I woud appreciate your thought's and comments on this matter.

Regards to all

[samuibeachcomber]

It can be a real risk here in thailand,as there's very little legal backup should the company default.check out the history of this co. first,you could go to a law firm to get advice.

[midas]

Just over one year ago Thailand introduced The Escrow Act ( it was about time too ) to try to deal with this problem.

This provides for deposit money's to be held by an approved government regulated deposit holder. There are not

a huge number of approved deposit holder's around just yet partly because the requirements to become one are quite onerous.

If you are absolutely determined to go ahead with this and you cannot find any information about The Escrow Act yourself

please PM me and if you want I can provide contact details to you of an American lawyer in Bangkok who has even written

articles on this so he knows all about this.

But unless the developer is willing to go along with this it's academic and many developers need your money

in their pocket to finance the project. In this current economic climate I just think it would be financial suicide

for you to pay any money to anyone other than an approved deposit holder under the The Escrow Act.

That is my opinion

[JohnC]

A number of projects here in Pattaya are now being offered at less than the original off plan price so my advcie for what its worth would eb hang on to your money then when the development is complete if you are still interested you know you are buying something and not just a dream.

[samuibeachcomber]

there have been so many stories on this website re crooked developers in hua hin,keep your money in your pocket,this country is thievesville.

[khundon]

"I recently made inquires with regards to a OFF PLAN freehold 2bed condo in Hua Hin 3.5m THB,which is due to complete in June/July 2009."

Which development is it you are talking about, where in HH, which soi??

[MTS]

"I recently made inquires with regards to a OFF PLAN freehold 2bed condo in Hua Hin 3.5m THB,which is due to complete in June/July 2009."

Which development is it you are talking about, where in HH, which soi??

Akamai Village

Soi Amnuypon

[johnnyk]

Don't be quick to jump at the "off-plan". World economy is in the tank and looks like it will get worse before it gets better. I suspect buyers are not lined up for new condos anywhere.

Why not wait to see if it really is completed mid-2009? Its only a few months away. If it completes in a satisfactory manner you can always go and offer the "off-plan" price. Given the circumstances the developer may be quite happy to see you. There's no need to take on real estate risk these days.

[H2oDunc]

When I was in HH the normal practice was you paid a third of the finished price up front. This then got the building up and the walls. You then paid another third to get the roof and interior finished. Once the house was finished you paid the last third which was the profit and moved in. A guy I knew was doing nicely doing it that way but then he was honest.

It worked for a while then everybody and his Thai missus became " Developers " And most were not very good at it hence the state of things in HH now. Cars are being burnt out or people are getting shot. Plus prices there have gone crazy !! OK for a weekend but thats it for me Im afraid

[samuibeachcomber]

Don't be quick to jump at the "off-plan". World economy is in the tank and looks like it will get worse before it gets better. I suspect buyers are not lined up for new condos anywhere.

Why not wait to see if it really is completed mid-2009? Its only a few months away. If it completes in a satisfactory manner you can always go and offer the "off-plan" price. Given the circumstances the developer may be quite happy to see you. There's no need to take on real estate risk these days.

good advice,a fool and his money is easily parted.

[MTS]

Just over one year ago Thailand introduced The Escrow Act ( it was about time too ) to try to deal with this problem.

This provides for deposit money's to be held by an approved government regulated deposit holder. There are not

a huge number of approved deposit holder's around just yet partly because the requirements to become one are quite onerous.

If you are absolutely determined to go ahead with this and you cannot find any information about The Escrow Act yourself

please PM me and if you want I can provide contact details to you of an American lawyer in Bangkok who has even written

articles on this so he knows all about this.

But unless the developer is willing to go along with this it's academic and many developers need your money

in their pocket to finance the project. In this current economic climate I just think it would be financial suicide

for you to pay any money to anyone other than an approved deposit holder under the The Escrow Act.

That is my opinion

Thanks mate for the PM

[midas]

Just over one year ago Thailand introduced The Escrow Act ( it was about time too ) to try to deal with this problem.

This provides for deposit money's to be held by an approved government regulated deposit holder. There are not

a huge number of approved deposit holder's around just yet partly because the requirements to become one are quite onerous.

If you are absolutely determined to go ahead with this and you cannot find any information about The Escrow Act yourself

please PM me and if you want I can provide contact details to you of an American lawyer in Bangkok who has even written

articles on this so he knows all about this.

But unless the developer is willing to go along with this it's academic and many developers need your money

in their pocket to finance the project. In this current economic climate I just think it would be financial suicide

for you to pay any money to anyone other than an approved deposit holder under the The Escrow Act.

That is my opinion

Thanks mate for the PM

No problem- but i still echo all the others in this thread who say

there is no need for you to do anything now- you can comfortably

wait until the builiding is finished- you might even get a discount then

[loong]

If the building contractor needs buyers' cash up front in order to complete the project, stay away.

Nobody in their right mind would pay up front in normal times, so you'd have to be crazy in the current economic climate.

There must be a fair risk that this project will never be finished.

[thaihome]

If the building contractor needs buyers' cash up front in order to complete the project, stay away.

Nobody in their right mind would pay up front in normal times, so you'd have to be crazy in the current economic climate.

There must be a fair risk that this project will never be finished.

Have to agree. If the developer does not have the bank loans in place to finish the project and is depending on off plan sales to finance construction, you are not dealing with a strong company.

TH

[MTS]

Just over one year ago Thailand introduced The Escrow Act ( it was about time too ) to try to deal with this problem.

This provides for deposit money's to be held by an approved government regulated deposit holder. There are not

a huge number of approved deposit holder's around just yet partly because the requirements to become one are quite onerous.

If you are absolutely determined to go ahead with this and you cannot find any information about The Escrow Act yourself

please PM me and if you want I can provide contact details to you of an American lawyer in Bangkok who has even written

articles on this so he knows all about this.

But unless the developer is willing to go along with this it's academic and many developers need your money

in their pocket to finance the project. In this current economic climate I just think it would be financial suicide

for you to pay any money to anyone other than an approved deposit holder under the The Escrow Act.

That is my opinion

Thanks mate for the PM

No problem- but i still echo all the others in this thread who say

there is no need for you to do anything now- you can comfortably

wait until the builiding is finished- you might even get a discount then

Very good point and advice,I am NOT in any form of hurry.

[WilliamCave]

I recently made inquires with regards to a OFF PLAN freehold 2bed condo in Hua Hin 3.5m THB,which is due to complete in June/July 2009.

I was told and it's on the contract that installments payments which is to be paid monthly must be paid to the construction companies bank account.

I feel uncomfortable with this arrangement base on the points below.

1. What if the construction company goes under base on todays financial situation,I mean big establish banks and companies are folding down at short notice.

2. What if the MD of the construction company gets eliminated for what ever reason,we all know what happen to an property developer in Phuket few days ago.

For eg: in he UK the system works very different.

All deposit funds are paid to MY solicitor--- my solicitor transfers the funds to the construction company/builders solicitor,and until completion the money stays with the builders solicitor and he or she is responsible and liable.

So even if the constraction company goes under (which lot of them are these days) your deposit money will be safe.

I wonder if anyone out there has had similar experience,if so I woud appreciate your thought's and comments on this matter.

Regards to all

Be careful..does not sound good, my wife and I put money down on a new home and 100,ooo baht and were not required to pay anymore until the place was ready...I would refuse to give anymore, dont pay for something u havnt got,,

be very careful sounds to me like a bad deal my wife said that usually thais will only put a deposit and wait until the house is ready,, not the way u are doing it...

[pkrv]

I recently made inquires with regards to a OFF PLAN freehold 2bed condo in Hua Hin 3.5m THB,which is due to complete in June/July 2009.

I was told and it's on the contract that installments payments which is to be paid monthly must be paid to the construction companies bank account.

I feel uncomfortable with this arrangement base on the points below.

1. What if the construction company goes under base on todays financial situation,I mean big establish banks and companies are folding down at short notice.

2. What if the MD of the construction company gets eliminated for what ever reason,we all know what happen to an property developer in Phuket few days ago.

For eg: in he UK the system works very different.

All deposit funds are paid to MY solicitor--- my solicitor transfers the funds to the construction company/builders solicitor,and until completion the money stays with the builders solicitor and he or she is responsible and liable.

So even if the constraction company goes under (which lot of them are these days) your deposit money will be safe.

I wonder if anyone out there has had similar experience,if so I woud appreciate your thought's and comments on this matter.

Regards to all

Buying off the plan requires additional medical insurance for hair loss (being torn out) and cardiac arrest. And that was back in the good old days of 2005.

IMO johnnyk (and BEENTHEREDONETHAT) know the area he/they have/has helped me as tourist to HH in the past. I did see some developments going up but they were a long way out of town (sorry sea side sleepy village ];-).

From past experience a schedule is produced requiring something like three payments, minimum depost, 30% down payment and 70% final payment over MANY YEARS for me 2005 through to 2008.

Does this help?

Edited February 24, 2009 by pkrv

[dotcom]

When I was in HH the normal practice was you paid a third of the finished price up front. This then got the building up and the walls. You then paid another third to get the roof and interior finished. Once the house was finished you paid the last third which was the profit and moved in. A guy I knew was doing nicely doing it that way but then he was honest.

It worked for a while then everybody and his Thai missus became " Developers " And most were not very good at it hence the state of things in HH now. Cars are being burnt out or people are getting shot. Plus prices there have gone crazy !! OK for a weekend but thats it for me Im afraid

Apples & oranges. With a house you already own the land so you can't lose that.

Of course you set milestones & payments. Nothing like the situation the OP is in.