Where To Hold Deposit For Purchase Of Property?

[bkksiam]

If I have to pay a deposit as part of a sale and purchase agreement/reservation agreement, where is the safest place to hold that deposit? the lawyer? the bank? (note I do not wish to leave it with the agent because she is related to the seller).

This is a large sum of money. Although the agreement states that the seller will forfeit deposit+ if she/he pulls out,what guarantee do I have that I will get this money back? or do I just end up paying more legal fees to fight to get it back -note the seller is out of the country.

[bigbamboo]

From what you say I would suggest firmly in your stickiest palm.

[soi41]

If it is the same condo, you mention in another thred, DO NOT pay anything, before talking to the bank=owner!!

[BlackPuddingBertha]

"where is the safest place to hold that deposit?"

In your pocket. Pay in full at the Land Office and not before.

What possible reason could there be for paying a deposit anyway? Is this condo such a bargain that they are beating off buyers with a stick? If so they would just put the price up.

"Although the agreement states that the seller will forfeit deposit+ if she/he pulls out,what guarantee do I have that I will get this money back?"

None at all. You might have to take them to court.

[iluvbeaches]

"where is the safest place to hold that deposit?"

In your pocket. Pay in full at the Land Office and not before.

What possible reason could there be for paying a deposit anyway? Is this condo such a bargain that they are beating off buyers with a stick? If so they would just put the price up.

"Although the agreement states that the seller will forfeit deposit+ if she/he pulls out,what guarantee do I have that I will get this money back?"

None at all. You might have to take them to court.

True but if it is a resale a deposit of 1-2% could be for the seller to pay for lawyer, translation and out of pocket fees. And motivate the buyer to make sure they have everything in order document wise to effectuate the sale at the land office. Otherwise if there is an oops I forgot my passport then the seller would be out of money and time.

I don't know, I would not be willing to meet a buyer without at least a 10-20,000 baht deposit.

[BlackPuddingBertha]

True but if it is a resale a deposit of 1-2% could be for the seller to pay for lawyer, translation and out of pocket fees. And motivate the buyer to make sure they have everything in order document wise to effectuate the sale at the land office. Otherwise if there is an oops I forgot my passport then the seller would be out of money and time.

I don't know, I would not be willing to meet a buyer without at least a 10-20,000 baht deposit.

I can see your argument for a small deposit as you mention, though the OP did mention "a large sum of money" so presumably in his case it is more than 20K. Many people here seem to think that a deposit of 10% is normal. I do not, especially as the vendor makes no similar deposit.

In theory in Thailand you can actually look at a condo in the morning, decide to buy it and do the transfer the same afternoon with absolutely no prior expense being incurred at all, apart from transport costs to the Land Office. So why pay a large one-sided deposit to people who you dont know? I wouldnt.

[iluvbeaches]

True but if it is a resale a deposit of 1-2% could be for the seller to pay for lawyer, translation and out of pocket fees. And motivate the buyer to make sure they have everything in order document wise to effectuate the sale at the land office. Otherwise if there is an oops I forgot my passport then the seller would be out of money and time.

I don't know, I would not be willing to meet a buyer without at least a 10-20,000 baht deposit.

I can see your argument for a small deposit as you mention, though the OP did mention "a large sum of money" so presumably in his case it is more than 20K. Many people here seem to think that a deposit of 10% is normal. I do not, especially as the vendor makes no similar deposit.

In theory in Thailand you can actually look at a condo in the morning, decide to buy it and do the transfer the same afternoon with absolutely no prior expense being incurred at all, apart from transport costs to the Land Office. So why pay a large one-sided deposit to people who you dont know? I wouldnt.

True.

[worgeordie]

So is this Condo in a finished state,if so no need to put any deposit down

just go ahead and buy it,but still take utmost care.

If its been built you would need to put deposit down,say 10%, then there

will be further payments as the build progresses,this should always be

in the contract.

regards Worgeordie

[rgs2001uk]

True but if it is a resale a deposit of 1-2% could be for the seller to pay for lawyer, translation and out of pocket fees. And motivate the buyer to make sure they have everything in order document wise to effectuate the sale at the land office. Otherwise if there is an oops I forgot my passport then the seller would be out of money and time.

I don't know, I would not be willing to meet a buyer without at least a 10-20,000 baht deposit.

I can see your argument for a small deposit as you mention, though the OP did mention "a large sum of money" so presumably in his case it is more than 20K. Many people here seem to think that a deposit of 10% is normal. I do not, especially as the vendor makes no similar deposit.

In theory in Thailand you can actually look at a condo in the morning, decide to buy it and do the transfer the same afternoon with absolutely no prior expense being incurred at all, apart from transport costs to the Land Office. So why pay a large one-sided deposit to people who you dont know? I wouldnt.

I do not, especially as the vendor makes no similar deposit.

You must have spent either too long in Pattaya or been listening to too many former barrow boys spivs who have now re-invented themselves in the LOS.

Its common for both buyer and seller to sign a sales contract with each putting in say 1 or 2% of the agreed sales price, written in the contract, if either party pulls out, the other keeps both deposits.

[BlackPuddingBertha]

Its common for both buyer and seller to sign a sales contract with each putting in say 1 or 2% of the agreed sales price, written in the contract, if either party pulls out, the other keeps both deposits.

That is a contractual obligation and not a deposit. Agents here will often ask buyers for 5 or 10% deposit in cash, but vendors are rarely if ever asked for any cash. Hence my point.

I have no issues with contractual obligations; it's the cash deposits that bother me as here there is absolutely no guarantee from a reliable and regulated third party that you will ever see it again.

[rgs2001uk]

Its common for both buyer and seller to sign a sales contract with each putting in say 1 or 2% of the agreed sales price, written in the contract, if either party pulls out, the other keeps both deposits.

That is a contractual obligation and not a deposit. Agents here will often ask buyers for 5 or 10% deposit in cash, but vendors are rarely if ever asked for any cash. Hence my point.

I have no issues with contractual obligations; it's the cash deposits that bother me as here there is absolutely no guarantee from a reliable and regulated third party that you will ever see it again.

Agents here will often ask buyers for 5 or 10% deposit in cash,

Agents where? 10% deposit, no chance, sounds more like a bunch of farang chancers trying to apply what happened in XXXXX, insert wherever you want., This is Thailand, not farangland.

but vendors are rarely if ever asked for any cash

See answer to above, sounds like the spivs have no idea of what actually happens between Thai/Thai buyer and seller.

Hence my point.

Not going to argue, where in Thailand are you talking about?

it's the cash deposits that bother me as here there is absolutely no

guarantee from a reliable and regulated third party that you will ever

see it again.

Agreed 101%

Some refer to it as an "escrow account", choose your agents wisely, Billy from Billericay who has just done a 10 stretch in the "Scrubs" probably isnt your first choice of an agent. Dagenham Dave is your first choice.

[breadbin]

Deposits are usually non refundable and as such the vendors lawyers will hold it.

If the buyer does not proceed it is forwarded to the vendor.

If the vendor withdraws then the deposit is returned along with maybe compensation depending on what the agreed contract says.

All simple.

There is no need to complicate things.

KISS.

[breadbin]

When I sold my place I insisted on 10% deposit,

This then shows and tests the buyer,

If they want to pay a minimal deposit then what does that say to you.

If the buyer is serious and agrees the contract then they will pay 10%

If they are unsure then....,

[BlackPuddingBertha]

Agents here will often ask buyers for 5 or 10% deposit in cash,

Agents where? 10% deposit, no chance, sounds more like a bunch of farang chancers trying to apply what happened in XXXXX, insert wherever you want., This is Thailand, not farangland.

Pattaya. Thai agents. 5-10% is commonly requested regardless of nationality. Whether they get it or not is another story, but having seen an email from an overseas pigeon buyer the other day, asking if a certain used condo would still be on sale in 4 weeks time (this is a place that has been up for sale for 3 years to my personal knowledge) I suspect that there are enough stupid newbies around to pay out these sums on a whim.

Personally I dont waste much time with farang agents as mostly they are just too incompetent for words, and their properties are even more overpriced than those from Thai agents.

Some refer to it as an "escrow account", choose your agents wisely, Billy from Billericay who has just done a 10 stretch in the "Scrubs" probably isnt your first choice of an agent. Dagenham Dave is your first choice.

This is the problem. There are no proper escrow accounts here as far as I can see and I certainly wouldnt hand over large amounts of cash to an unregulated and unqualified estate agent, no matter where he is from. (In much of Europe agents are prohibited by law from accepting deposits for this very reason.) I would be wary of handing it over to a regulated and qualified Thai lawyer, especially if they had some other involvement in the sale. And I wouldn't hand it over to the so-called property owner either, as he could be a total crook also.

For me the only viable option for deposits is for both parties to lodge an identical amount with a bank or other totally independent and reliable third party, but I wouldnt hold my breath waiting for that to happen here.

So it still boils down to no deposits and bash on with the sale as fast as possible, as far as I'm concerned.

[thaicbr]

http://www.kasikornbank.com/EN/AboutUs/CompanyNews/Pages/news270911_E1C89FCD.aspx

escrow account.. dunno if they still do.

[BlackPuddingBertha]

http://www.kasikornbank.com/EN/AboutUs/CompanyNews/Pages/news270911_E1C89FCD.aspx

escrow account.. dunno if they still do.

Good idea. I wonder if it ever got off the ground?

[bangkokburning]

Black Pudding Bertha - I have come to really enjoy and value your real estate insight as much as trogers.

[JomtienEats]

Firstly look at a deposit in terms of fairness. If you've agreed to purchase and you're asking the vendor to take the property off the market and guarantee it for you while you spend 2 weeks getting the money together, it's reasonable that he should expect compensation (your deposit) if you fail to meet your obligation.

However, how do you know the seller is holding up his end of the bargain . . . what if he is offered 5% or 10% more for the property during those two weeks . . you'll likely get gazumped. Or maybe you'll be invited to make a higher counter offer, knowing that you'll have a hassle trying to recover your deposit if the sale is made to the other buyer. The solution is for both the buyer and seller to place funds in escrow . . but then you have the problem of finding a third party you trust more than the seller, and proving your case that you were gazumped. Maybe that's worthwhile if it is a high value property.

So I'd advise against placing a deposit in most circumstances - you're getting nothing for it and just placing yourself at a disadvantage. Just tell the seller or the agent you'd like to buy the property, you'll be back to do so in two weeks when the funds are in place, good luck to them if they find another buyer in those 2 weeks (they won't).

[JomtienEats]

>note the seller is out of the country.

Also if the seller is out of the country, how are they signing the agreement? Is there a valid POA? Do you have the funds in place already and are waiting for the seller to come to the country? Maybe he should be giving you a deposit for waiting around!

[PattayaPhom]

Why worry about laying a deposit,if a buyer is genuine that deposit is part of the purchas price paid on transfer. If a buyer has doubts sbout paying a deposit its because they have doubts about completing the purchase. If a loan is attached to a property the owner must arrang with the bank for date of transfer this incurrs costd. If its a company set up agsin costs involved. Thais sleays leave at lesst 10% deposit. My word is my bond, Im 100% sure is all a cop out and mesns nothing. Deposits are needed

[JomtienEats]

Deposits are needed

Not by the buyer. Needed by the seller maybe . . and if that's the case the onus should be on the seller to arrange a fair reputable escrow that protects everyone.