Iou

[Smokemachine]

My wife is a Thai. Her friend seek to borrow a large sum of money from my wife. In order to protect my wife interest. I ask her to make a paper written to get the borrower to acknowledge incase they deny it.is such personal written agreement valid when it is submitted in a court hearing ?does anyone has a sample of a official IOU form can show me?

[soi41]

Mr. Kelvin. From your posts here, I understand you are quite new to Thailand. So read some of the old posts on this forum, about the lack of moral and lack of a real working legal system here. So ofcourse your wifes "friend" want to borrow money from her, probably to pay of old gambling debts or to enable her continuing gambling. Your wife is "madame" now, with a golden goose from Singapore, so ofcourse her fellow Thais expect her to share her (your) wealth with them. Don't do it. Just tell your wife to say NO, will save your a lot of headache in the future. If you are in a new relationship, keep an eye on the bankaccounts for the next couple of months! Even if she sleeps with you, her solidarity will always be with her fellow Thais! Be careful, it's a jungle out there.

[h90]

It doesn't happen that they ask you for the money?

[h90]

Mr. Kelvin. From your posts here, I understand you are quite new to Thailand. So read some of the old posts on this forum, about the lack of moral and lack of a real working legal system here. So ofcourse your wifes "friend" want to borrow money from her, probably to pay of old gambling debts or to enable her continuing gambling. Your wife is "madame" now, with a golden goose from Singapore, so ofcourse her fellow Thais expect her to share her (your) wealth with them. Don't do it. Just tell your wife to say NO, will save your a lot of headache in the future. If you are in a new relationship, keep an eye on the bankaccounts for the next couple of months! Even if she sleeps with you, her solidarity will always be with her fellow Thais! Be careful, it's a jungle out there.

But in case, her friends buffalo got sick and she need the money for the medicine (which can be very expensive) he should help with money.

[GuestHouse]

Do yourself, your wife and her 'friend' a big favour and just say no.

If you don't say no then do the rest of us a favour by not coming on here whinging or asking for advice when your wife's 'friend' fails to pay the money back.

[soi41]

^^ That goes without saying ! How could I forget kwai.

[scorecard]

Summary:

- When there is a foreigner somewhere in the picture, 'borrow some money' actually means 'give me some money'. Most foreigners will tell you they have seen this scenario. 'Borrow' sounds more nice but there is no intention to repay.

- A very large % of Thais are totally convinced that all foreigners are super rich and have unlimited funds. Try to explain that you are not rich and you'll probably, eventually, get the following responses:

• "I don't believe you".
  
• "Farang governments are rich and they give big money to everybody".
  

- Documents, such as an IOU, rental agreement etc etc., are not strongly respected.

- Not meaning to make any judgemental comment about your wife, Thai people find it very awkward to ask for repayment or ask for some part repayment (avoidance of any scenario which looks anything like confrontation).

- If your wife does ask for repayment, she could very likely lose a friend who will very probably publicize the matter and your wife could get negatve reactions from all who know that she asked for repayment.

- Saying 'No', is the best policy. Difficult but will likely deter further requests. But will likely brand you as stingy or similar.

Or put it the other way, hand over the money now and then how do you say no to the next in line (especially if it's a close relative who now knows that a large amount of 'funds' was given to the friend).

And you can have a guarantee, once you say yes the first time, the q will build quickly.

Make an excuse that there is no cash available at the moment because of ... some lame excuse - money is locked in a special bank account in (wherever) and cannot withdraw more than 10,000* Baht a month for living expenses for next three years...... .

*deliberately a fairly low amount. Stating a big amount (for living expenses) 'proves' that your rich.

- Plenty of Thais (and not only Thais) are irresponsible with money. There are large numbers of Thais who have filled their several credit cards, can't make the needed payments / part payments, but apply for further credit cards.

- Is there an alternative possible source to borrow from that your wife could suggest? (A local cooperarive or something like that - but the reality is that there is very probably no intention of paying it back so any form of actual borrowing (with repayments) is not what the friend wants anyway).

Good luck.

Edited April 11, 2012 by scorecard

[carra]

it seems some people did not read your post correctly, they are asking to borrow your wifes money and ot your money, unless you have written it wrong and by wifes money you mean your money.

If this happens I tell my wife that if I lend money that is money she will not have if its not paid back, once your wife sees that it will affect her directly rather than just affect you then she will probably be quick to say no to her friend. Make it clear its your wifes money you are lending. If she says ok to this the back pedal and just say no haha.

[pattayadingo]

IF you decide to lend money do not get an I.O.U. Get some proper paperwork - if any is available.

Depending on the amount, you want the book for her car or her motorcycle or land she owns, along with a properly written agreement. Do not make the interest rate too high or a judge can throw it out of court.. Not photocopies or any other BS documentation. That way you get the m/c or car if you do it properly.

Problem is, you need an independent person to verify it is her property you get the documentation for. Her name, her address etc. Do not trust the wife / g/f because that usually does not work.

In reality, do not lend / loan people money here. There is often little recourse to get it back. Even if you do take the m/c or car or whatever it is liable to cause problems for the future. Far better to put your foot down and say no now.

If the woman is reliable for repayments, why is she not going to the bank instead of the Farang bank? My bet is she has no collateral.

Lose / Lose situation if you go ahead.

[IanForbes]

There is no such thing as a "loan" in Thailand... unless it's something that YOU borrow from a bank.

All "loans" between family friends and relatives are "gifts". If you want to give a gift then set your limit and stick with it.

Of course, you already knew all that.

[loong]

I wouldn't agree that the Thais borrow with absolutely no intention to pay back. Most do not consider their ability to repay though. Eg. If they have an income of 2 or 300 Baht a day, they will still borrow and agree to repay at 5,000 Baht per month.

Take note and believe as gospel what other posters have already said though.

To lend money to friends will only bring you grief and frustration. You may think that you are the good guy by helping them out, but you will suddenly become the villain when trying to get the money back.

Lend to one and the avalanche will start. It is much simpler just to say no to the first and every request. Eventually they will stop asking.

You don't have to give any reason, it's your money and you have the right to say no. I just say that I am not a bank and they should go to a bank if they want money.

Edited April 11, 2012 by loong

[norrona]

I fancy a loan....and you don't even know me nor does your wife....

But I will wager my left testicle that I would pay it back before your tiraks friend does

[Kwasaki]

There are such papers but they are not worth the paper they are written on.

It's really a case of my wife would no-way borrow large amounts, depends what you call large.

If my wife lends 10,000 say it has to be backed up with gold kept in her posession or not just a green book for a motorbike the motorbike as well.

[rustycan]

You are not a financial institution, signing IOU means zilch over here. The money that your wife intend to loan out will definitely not be returned. You are probably very new to Thailand. Please learn to say no to any loan and mean it, don't give way even to your wife (sorry for being harsh here). I have seen many many times borrowers flee from friends or close relatives to escape repayment, even you have a proper IOU, it is but just a piece of paper that has no value in it. I always believe that money in my pocket is better and safer than in the borrower's pocket. Spare yourself the future aggravation, do the right thing by saying no.

[brit1984]

If your wife's friend has some assets (gold/car/land/property) you could simply offer to buy them at a discount to market value. If she really needs instant cash, she might agree. You could make a tidy profit in a short period, assuming you are confident of the realisable market value of the assets.

With regards to the loan, it is impossible for me to assess the credit worthiness of this individual without knowing the idiosyncrasies of the case. However, your post did not provide me much confidence in the investment case.

[GuestHouse]

I think we have at last goind a subject which has responses that enjoy a broad and general agreement across all TV members.

I never thought that would happen - Maybe trust is lkke the IOU, just words on a piece of papper- backing them with hard cash is something wuite different.

Edited April 11, 2012 by GuestHouse

[IanForbes]

I wouldn't agree that the Thais borrow with absolutely no intention to pay back. Most do not consider their ability to repay though. Eg. If they have an income of 2 or 300 Baht a day, they will still borrow and agree to repay at 5,000 Baht per month.

I think you touched on a very real point. Many people DO have the intention of paying back a loan. What they DON'T have is the concept of how to actually do it. It's like when they purchase a motorbike for whatever extremely high interest rate the company charges. They only make 7000 baht a month, their room rent is 2500 baht, but they have two children to take care of plus all the other expenses. They try to make minimum payments and eventually just fall behind. A year later the Honda company comes and repossesses the bike. Thais are actually quite generous with each other, but with large amounts of money there is no concept of how to pay it back.

[GuestHouse]

I'm not buying this excuse that they don't think about how they will make the repayments. I've personally seen Thais borrow large amounts of money and abscond (in two intdances to overseas) within days of getting their hands on the 'loan'.

And I have a sneaky suspicion that when they borrow from the leg breakers they absolutely do have a plan to repay.

As an aside, I have never ever had anyone back in the old country ask me for a loan (beyond someone who forgot their wallet at lunch time - loans of more than say £10/Bht500 have never ever been asked of me back there.

Here in Thailand I've had numerous people ask to borrow large sums of money. One Thai neighbour asked to borrow Bht80K, a week later he had gone missing with his minor wife, other peoples money but not one red cent of mine.

The mindset is, you've got money and they believe they are entitled to it.

[loong]

I'm not buying this excuse that they don't think about how they will make the repayments. I've personally seen Thais borrow large amounts of money and abscond (in two intdances to overseas) within days of getting their hands on the 'loan'.

And I have a sneaky suspicion that when they borrow from the leg breakers they absolutely do have a plan to repay.

As an aside, I have never ever had anyone back in the old country ask me for a loan (beyond someone who forgot their wallet at lunch time - loans of more than say £10/Bht500 have never ever been asked of me back there.

Here in Thailand I've had numerous people ask to borrow large sums of money. One Thai neighbour asked to borrow Bht80K, a week later he had gone missing with his minor wife, other peoples money but not one red cent of mine.

The mindset is, you've got money and they believe they are entitled to it.

I have made loans in the past and not only have the borrowers intended to repay, they have paid back in full. So I do believe that the majority do intend to repay, but are not capable of any sort of financial planning.

I don't doubt what you say about some people taking the money and running, but I have only lent to people that have some sort of security. I would hold their chanote land deed until repaid. Any requests for more than 10,000 were dismissed without further consideration.

I won't lend money anymore because I really don't want the hassle of chasing them for repayments. Without the chasing, I would probably not have been repaid. Also the fact that I pressed for rtepayment meant that I was considered Jai dum by some!

Lending money nearly always leads to hassle, and that is not restricted to Thailand.

In the UK, although most loans were around the 10 pounds mark, I did once lend a "friend" 500 Pounds to help him out. He disappeared the next day. That was way back in the 70's when I was on good money and 500 Pounds was about 6 weeks earnings. So, wherever you are in the world there will always be people who will spot a soft touch with more money than sense and they will take advantage.

But I reiterate, lending relatively large sums of money to anyone, Thai or Farang will not add any happiness to your life and is most likely to do the opposite.

[soi41]

No response from the OP so far. Maybe his wife is blocking the computer, trying to raise the creditlimit on the online shoppingcard ?

[wana]

i work with a girl (thai ) and her best friend (thai) borrowed 50k

to be paid back at 10k a month for 5 months

at the end of the first month ,she called and said she can pay only 2000 because............ (insert whatever here !)

now her previous best friend hasnt spoken to her in over half a year ,and shes afraid to call her also ,in case she offends her by giving her the impression shes calling "just " to get the money back

best friends since high school and this is how it ends ,be careful loaning anything ,it can sour the best of relationships

[rijb]

Our experience is that lending or giving money to family, friends or neighbors seems to cause as much resentment as saying no.

They'll be back to ask again, regardless! Say no and use your money for a gate.

[brit1984]

Clearly making personal loans is not an easy business but with a bit of common sense it can be very lucrative.

I have a Thai friend who made more than 100k GBP (5m baht) last year through a combination of personal loans and buying (and reselling) assets from people (normally Thais) who need quick cash.

She told me even the poorest Thais have some retail gold stashed around the house, so as long as you are tough and smart when you agree the deal you can reduce the risk significantly.

However, as alluded to by other posters, lending money to other people (not just Thais) is not a way to strengthen friendships. Lending money is business and the moment you forget that it becomes charity.

Edited April 11, 2012 by brit1984

[Smokemachine]

Thanks for all your precious feedback. It's true I'm new in Thailand and I'm going to stay here for good soon.really need people to guide me how to survive here. Actually is her own $. I just worry her friend might not return to her. Pertaining to some replies,mentioned about taking the borrower motorbike,valuable accessories. How about house or land title?can we draft out a proper written agreement?for example,if the borrower agree to use her land deed as "mortgage" to my wife.in the end,she signed the agreement and refused to do the transferring of the land title.will the written agreement be accepted by the court and eventually order the land title to my wife?does anyone know such actual cases?

[wana]

Thanks for all your precious feedback. It's true I'm new in Thailand and I'm going to stay here for good soon.really need people to guide me how to survive here. Actually is her own $. I just worry her friend might not return to her. Pertaining to some replies,mentioned about taking the borrower motorbike,valuable accessories. How about house or land title?can we draft out a proper written agreement?for example,if the borrower agree to use her land deed as "mortgage" to my wife.in the end,she signed the agreement and refused to do the transferring of the land title.will the written agreement be accepted by the court and eventually order the land title to my wife?does anyone know such actual cases?

i dont think any a judge would give you someones home or car over a trivial mount of money ,probably it would never get to trial

the police would either force you to give back the deeds and accept a smaller payment etc and let that be the end of it etc

besides ,you will quickly rack up enemies if you are taking peoples homes and vehicles as security for loans which in all likelyhood

cannot afford to be paid back

do you realy want the deeds to someones home to lend them a wad of cash they probably do not have the means to pay back ?

why cant people not just say no ? it would start a trend that all farangs are not ATM machines with unlimited cash

Edited April 11, 2012 by wana

[pipo1000]

Thanks for all your precious feedback. It's true I'm new in Thailand and I'm going to stay here for good soon.really need people to guide me how to survive here. Actually is her own $. I just worry her friend might not return to her. Pertaining to some replies,mentioned about taking the borrower motorbike,valuable accessories. How about house or land title?can we draft out a proper written agreement?for example,if the borrower agree to use her land deed as "mortgage" to my wife.in the end,she signed the agreement and refused to do the transferring of the land title.will the written agreement be accepted by the court and eventually order the land title to my wife?does anyone know such actual cases?

You can register the loan at the land office and have your name added on the back of the title deed,and the loan contract is cerified by the land office. I had this done some years ago,and I think at that time the cost was 0.03% of the borrowed amount.

In this case she can not sell the land as long as the loan isn't cleared.In this case I would advice you to use a lawyer to produce the written agreement.

[soi41]

Why ask for advice here, when you, despite everyone here telling you to say NO, still are going to let your wife lend the money to her "friend". It is your life and money, do what the <deleted> you want, but don't expect any advice in the future on how to get the money back.

[pipo1000]

Why ask for advice here, when you, despite everyone here telling you to say NO, still are going to let your wife lend the money to her "friend". It is your life and money, do what the <deleted> you want, but don't expect any advice in the future on how to get the money back.

The OP didn't ask advice as if he should lend or not,he asked advice if anyone had experience with a legal agreement if it goes to court. Edited April 11, 2012 by pipo1000

[wana]

Why ask for advice here, when you, despite everyone here telling you to say NO, still are going to let your wife lend the money to her "friend". It is your life and money, do what the <deleted> you want, but don't expect any advice in the future on how to get the money back.

The OP didn't ask advice as if he should lend or not,he asked advice if anyone had experience with a legal agreement if it goes to court.

motorcycles ,cars ,gold and even houses have been mentioned as collateral ,how much money is this proposed loan going to amount to ?

it sounds like a dreadful mistake if its not a troll poster having a laugh

if the borrower had ownership of motorcycles ,cars ,gold ,property etc its unlikely they would need the loan in the first place

and if they really needed it ,they would have legitimate lenders to go to and borrow from

[David48]

The OP didn't ask advice as if he should lend or not,he asked advice if anyone had experience with a legal agreement if it goes to court.

BUT ...

Thanks for all your precious feedback. It's true I'm new in Thailand and I'm going to stay here for good soon.really need people to guide me how to survive here.

Sometimes it helps to have advice from a wide gambit of contributors.

That way you can consider things that weren’t originally thought of.

I am sort of interested by the concept of 'her' money and 'your' money and how you keep the two separate.

Edited April 11, 2012 by David48