Lending Money

[nellyp]

Sorry if this is elsewhere but I can omly find info on westerner to Thai lending. my wife wants to lend the guy who harvested our fields 30,000 baht for 3 months at 10% per month. The return is good but I am obviously worried about the money itself. I told my wife that she should have security and the Thai in question says he understands that and has offered to put his harvester up for security. My problem is this---He can get a loan at 205 else where but cannot get finance of the company that he wants to buy a plogh attachment for his tractor from as he is now too old (about 65) plus (and this is my problem with this) he already has a loan with them for the Harvester. This obviouslt means that he is putting up the harvester as security butthat it is not owned by him outright. He is prepared to sign a contract saying that if he defaults on the loan (only 3 months) he will give us the harvester but will keep paying the finance for it. The money for the loan is my wifes money that she earned in Britain and has been sent here from her account in the uk, so I think we can prove the loan has nothing to do with me. I am worried about the finance position as I wanted the papers for the harvester. My wife assures me the contract will be binding but I'm sure she is just doing that Thai thing of assuming all will be well in the end (even after a massive family arguement to get 5,000 back off her brother. I have attached an example of a draft of a contract for the loan. I am no contract lawyer, but the wife said it would not matter and if we wrote it on a shirt it would be OK??? Any advice on the loan and contract would be brilliant. They are coming tomorrow to get the money so any quick replies would be great too.

Cheers

Neil

[CharlieH]

In my opinion, how can he offer as security that which is not his ? so personally I would forget the Harvester. i would ask for the paper on the land. If he's a farmer he will have the paper for the land unless the bank has that too against the Harvester loan.

I would take the guy to the Phu Yai Baan and photo him receiving the money from your wife and get the Phu Yai baan to witness it

Try and get an agreement for something tangible so if it does go wrong you can atleast retrieve something. Car etc that you can hold on to until settled,. I have been told that with small claims that the court will rarely do anything if the guy has nothing to start with, besides the fact that the legal process would probably cost more than the 30k your lending.

Hope it works out for you, but personally for 30k I doubt it very much

I know all about the relatives been there done that and still owed 16k, was supposed to be 500 a month, 1 got 3 payments in the last 12 months and there is nothing I can do (family) so I sympathise with your situation.

Good luck.

[givenall]

Iin my openion never never loan money to Thai. it would be close to impossible to get it back, I see this attitude even with none Thai people who live in Thailand for few years.

[onnut]

Why go through all this hassle and risk just to earn 9,000 baht over three months.

[rutteketuut]

Do not lend him the money because you will never get it back an d certanly not with the 10% intrest a month! This is Thailand and I know what I am talking about after 14 years living here. You can make a contract and the guy will come to your house a few days to pay you and then he will dissapear or if he doesn't you will go to his place and he will tell you ; I don't have money right now and after days or weeks of waiting you will go to the police with the contract and tell them your story. The police will tell you that you agreed with him and you will have yo take a lawyer. Lawyer= money. Your wife might be naive but hopely you are not.

Happy New Year

[monty]

Charging 10%/month or 120%/year is loansharking and most positively illegal (but indeed widespread) in Thailand.

The reason loansharks do ask such high interests is that they run a high risk of a high percentage of non payments, but they will also not stop trying to get it back and that includes some breaking of fingers etc if needed!