Buying Chanote Land And House In Thai Partners Name

[scubachild]

If I buy a property in my Thai partner's name is there any legal contact that we can sign that gives me some control over if and when the property is sold?

I guess lawyers will always be able to write a legal document but will it hold up in a court of law...?

Thank You for any advice

[InterestedObserver]

The simple answer is NO. Not unless you are going to enter into an usutruct agreement etc.

[ballbreaker]

Get a usufruct contract between you and Thai partner and register at land office. It can be done at land office for a couple hundred baht. The usufruct contract grants the right to use, manage and enjoy benefits of property that is owned by someone else. With a basic agreement the owner of property could still sell the property but buyer cannot cancel the usufruct. You could include language in usufruct to cover selling property but not necessary because no one will buy property with usufruct agreement in place. It gives you the rights of ownership but you do not own the property. I suggest getting one for end of your life rather than a fixed term. The usufruct can be cancelled should owner and you wish to sell property.

Another option is lease but that can only be max of 30 years and taxes for full term of lease must be paid when registered.

If already married then its already to late for any contract.

Edited June 10, 2013 by ballbreaker

[Jerry Cornelius]

If already married then its already to late for any contract.

Are you saying that you can't have a usufruct if you are married to the owner of the title deed?

I'm only asking as my usurfruct was registered whilst married. The only issue stipulated was that if I was pre-deceased by my wife, then I would need to find a buyer for the property/land within 12 months after the issuance of the death registration.

Jerry

[Crossy]

The issue is that any contract between husband and wife can be cancelled unilaterally by either party, fine to protect you from greedy relatives should your wife pre-decease you, not fine in the event of divorce.

[Jerry Cornelius]

The issue is that any contract between husband and wife can be cancelled unilaterally by either party, fine to protect you from greedy relatives should your wife pre-decease you, not fine in the event of divorce.

Ahh! Divorce scenarios which can be very messy and if things are contested, the lawyers get fat.

I totally missed any inference that the term contract was related to pre-nuptual agrrements, but yes,, purchases of property along with other assets aquired aftter marriage are (supposed) to be split 50-50. The land cannot be included but there can be a private civil contract which stipulates that some recompense is made to the foreign husband by the Thai wife.if a property is sold in the case of a divorce.

If she decides not to comply with that, at the time, then that's where the lawyers come onto the scene. A long drawn out and costly process without any guaranntee that the foreigner could win.

I wasn't aware that a usufruct could be cancelled by one party in isolation though. The reason I say this is because we have recently sold off some of our properties. During the sale transactions at the Land Office I had to agree the sale and sign for.the usurfuct on the chanote to be removed/cancelled. These properties were aquired by my wife after marriage.

Jerry

[mikeshov]

A usufruct does give you control over what happens on the land for the period - usually 30 years. But this on its own is of little use if you subsequently have an acrimonious separation from your partner. You should also ask the land office to register a charge on the property in your name to the value of your investment. Not all offices will do this for foreigners though. From personal experience, unscrupulous Thais can get loans from money lenders even with a usufruct registered on the chanotes and even if they don't have the original chanotes - they simply go to the land office, say they have been lost and are issued with a copy.

Also bear in mind that if she doesn't want to sell then there is nothing you can do other than try to come to some money sharing agreement with her.

[scubachild]

Thank you all so much for this interesting feedback. I had never heard of usufruct contract before. We are a gay male couple so perhaps that will make it easier in many ways. I was given some other advice that seemed quite simple (maybe too simple) and wonder if anyone can comment on it:-

Make a loan contract (same value of the property) with the Thai partner and put the deed or property paper as guarantor of the contract. Property
could not be transferred or sold while loan contract is still active.

Does that work....?

Thanks for any words of wisdom

[unanimosity]

The simple answer is NO. Not unless you are going to enter into an usutruct agreement etc.

Not so fast with the NO.

Loan the Thai enough money to purchase the property in her name using a standard lender agreement. You can set the repayment schedule according to realistic standards and if she ever defaults on the payments you have the option as a lender to foreclose and liquidate the property, since you would not be able to take title permanently.

[1FinickyOne]

thanks for playing and we leave you with these lovely parting gifts!

and from kansas city, kansas, our next contestant...

[belg]

cheaper and safer option : rent

at least if your neighbours get crazy or your girlfriend does, all you lose is just a place to stay, not your home that you cannot own, not your life saving, not your life

[personchester]

The simple answer is NO. Not unless you are going to enter into an usutruct agreement etc.

Usutruct gives the right to continue to use the property and "she" the owner perhaps pushed by her family can not kick you out, but you have no right of ownership or part ownership.

Therefore go to see a solicitor to make a loan agreement in respect of your partner, offer the loan interest free, but make the transmission that the loan is repayable if requested within six months to a maximum period of one year.

If you request the payment the partner must repay the money within this period, and if she has no money the house must be sold to provide the payment.

[LeeThayer]

When you are already married and buying land with a house, if you provide the money but not throught a transfer from abroad, you need to state on the contract that you claim nothing in the event of death or divorce. Only way to get a freehold title in your name is a condo. House, you have no control over.

[CiderFizz]

You have 4 choices.

1. Make a loan to your partner secured by a mortgage against the property. Your asset is then the loan debt rather than the house and land.

2. Take out a 30 year lease on the property which is renewable for a further 30 years.

3. Rent. No hassle with having your assets lifted by your partner AND property values in Thailand go DOWN not up as they as a wasting asset which will only last for a few years and the build quality is so dreadful.

4. Stay free and loose and find a friend when you need one and rent your home.

[jrtmedic]

I would be very wary about investing in anything to which a clear and unequivocal "right of ownership" cannot be established.

A friend of mine loaned a Thai person 1 million against a "legal" agreement drawn up by a Thai lawyer.

He is now involved in a court action in an attempt to secure repayment of the loan.

The judge directed that before the case proceeded "negotiation" should take place.

During the negotiation the defendant stated she did not care what happened, that she had no money and even if my friend won the case he would lose !

Caveat Emptor !

[jpinx]

No nO NO no and NO !!!!

No contract is worth the paper it's written on if one of the parties decides to break it, and your chances of a satist¡factory result through the legal system are non-existant given that it's not "your" legal system and you'll never get to understand it well enough and the lawyers will only play with you while you pay them, but they will spin it out forever......

P.S -- I speak from much experience of "cross-culture" contracts in many countries - not only Thailand.

P.P.S. -- The same applies in UK/USA/where-ever in farang land -- It's impossible to enforce a contract without the costs far exceeding the gain.

[F4UCorsair]

Take a mortgage over the whole property for an inflated value, so if it's worth, say, $50,000, make the mortgage for $100,000. If your partner isn't willing to go along with that for your protection, then she intends screwing you.

The alternative would be to take a new mortgage each year for an increased value, which involves discharging the old mortgage and taking a new one, which will involve prohibitive costs over time.

I did just that in Bali more than ten years ago, and when the partner started being difficult, I called in the mortgage. I settled for the actual value, buying price plus about 5% per annum, only because I didn't want to drag it out. The property was sold, and the mortgagor (me) was paid out with nothing left for the local partner. I didn't make any money, nor did I lose any, but nor did she.

I'm with you Cider Fizz. I read your post after posting mine. My solid recommendation would be to rent................both house, and girl !!

Edited June 11, 2013 by F4UCorsair

[jpinx]

You have 4 choices.

1. Make a loan to your partner secured by a mortgage against the property. Your asset is then the loan debt rather than the house and land.

2. Take out a 30 year lease on the property which is renewable for a further 30 years.

3. Rent. No hassle with having your assets lifted by your partner AND property values in Thailand go DOWN not up as they as a wasting asset which will only last for a few years and the build quality is so dreadful.

4. Stay free and loose and find a friend when you need one and rent your home.

As an aside -- assuming that the farang made a loan secured by a mortgage on the assets -- would there not be a problem if the loan is called in and the default happens whereby the assets come to the farang -- because farang are not allowed to own land in Thailand.

I have seen this system in action and it gets mixed reviews, usually depending on the whim of the local legal professionals who have to sort it out.

If the OP really WANTS to "invest" in Thailand -- fair enough if he remembers the golden rule -- never invest more than you are prepared to lose......

[chiangmaibruce]

<snip>. My solid recommendation would be to rent................both house, and girl !!

There is no girl. The Op has stated that the arrangement involves a male couple. As far as I am aware, under Thai law, that makes the arrangement one between two un-related individuals, and rules out (for example) the theoretical ability to make a usufruct null and void.

Edited June 11, 2013 by chiangmaibruce

[chiangmaibruce]

A registered mortgage rather than a loan agreement, and secured by the property. As another has noted, with a married (b/g) couple this arrangement is not always accepted by the lands office as the husband and wife are in some regards a single legal entity. This should not affect a gay couple. So a plus in that regard, but I would still identify and consider all the options open to you before committing yourself.

Remember also that, depending on your partner's other assets, the property would have to be sold to repay the debt ... and selling a house for fair market value in Thailand (even ruling out any litigation) is not exactly as simple or as fast as clicking your fingers.

<snip> Make a loan contract (same value of the property) with the Thai partner and put the deed or property paper as guarantor of the contract. Property
could not be transferred or sold while loan contract is still active.

Does that work....?

Thanks for any words of wisdom

Edited June 11, 2013 by chiangmaibruce

[personchester]

You have 4 choices.

1. Make a loan to your partner secured by a mortgage against the property. Your asset is then the loan debt rather than the house and land.

2. Take out a 30 year lease on the property which is renewable for a further 30 years.

3. Rent. No hassle with having your assets lifted by your partner AND property values in Thailand go DOWN not up as they as a wasting asset which will only last for a few years and the build quality is so dreadful.

4. Stay free and loose and find a friend when you need one and rent your home.

As an aside -- assuming that the farang made a loan secured by a mortgage on the assets -- would there not be a problem if the loan is called in and the default happens whereby the assets come to the farang -- because farang are not allowed to own land in Thailand.

I have seen this system in action and it gets mixed reviews, usually depending on the whim of the local legal professionals who have to sort it out.

If the OP really WANTS to "invest" in Thailand -- fair enough if he remembers the golden rule -- never invest more than you are prepared to lose......

It is not a golden rule, it is a darkness rule, because it is an outline of negative aspects.

People that follow this concept will create little purchase activities throughout their lives because certain risks have to be taken when purchasing aspects like, a property, a business, stock market shareholdings, and so on ...

[AnotherOneAmerican]

When you are already married and buying land with a house, if you provide the money but not throught a transfer from abroad, you need to state on the contract that you claim nothing in the event of death or divorce.

No you don't.

[jpinx]

You have 4 choices.

1. Make a loan to your partner secured by a mortgage against the property. Your asset is then the loan debt rather than the house and land.

2. Take out a 30 year lease on the property which is renewable for a further 30 years.

3. Rent. No hassle with having your assets lifted by your partner AND property values in Thailand go DOWN not up as they as a wasting asset which will only last for a few years and the build quality is so dreadful.

4. Stay free and loose and find a friend when you need one and rent your home.

As an aside -- assuming that the farang made a loan secured by a mortgage on the assets -- would there not be a problem if the loan is called in and the default happens whereby the assets come to the farang -- because farang are not allowed to own land in Thailand.

I have seen this system in action and it gets mixed reviews, usually depending on the whim of the local legal professionals who have to sort it out.

If the OP really WANTS to "invest" in Thailand -- fair enough if he remembers the golden rule -- never invest more than you are prepared to lose......

It is not a golden rule, it is a darkness rule, because it is an outline of negative aspects.

People that follow this concept will create little purchase activities throughout their lives because certain risks have to be taken when purchasing aspects like, a property, a business, stock market shareholdings, and so on ...

I trust you can back that opinion up with concrete examples over a period of 40+ years business and personal investments ?

[Skorz]

You can get an usufruct stamp from the lands department that gives you management rights over the land (and house which if a permanent structure is considered part of the land). However, often the lands department will advise your wife (in private) not to allow this as it takes away her rights to sell without your permission.

Alternatively you can get your wife to lease the land back to you for 30 years.

Even if you're married, I would strongly recommend against putting anything into her name. Get a lease off the land owner instead.

Even if you draw up a contract with your 'wife' it will mean nothing as all she has to do is say that she didn't understand it should there be a dispute.

DO NOT DO PUT THE CHANOTE IN HER NAME. AS SHE CAN BORROW MONEY AGAINST THE TITLE OR TRANSFER TO HER FAMILY/FRIENDS OR EVEN SELL IT FROM UNDER YOUR NOSE. YOU MAY BE ALL LOVED UP NOW, BUT AS SOON AS SHE GETS COLLATERAL THIS COULD CHANGE AND YOU MAY LOSE EVERYTHING.

IF YOU WIFE IS FROM A BAR BACKGROUND THEN YOU WILL LIKELY LOSE EVERYTHING, MAYBE NOT THIS YEAR, OR THE NEXT, BUT EVENTUALLY. DO NOT TRANSFER LAND INTO HER NAME.

Of course, I am a cynic and your relationship may be the real deal. Pardon the pun.

[F4UCorsair]

Thank you all so much for this interesting feedback. I had never heard of usufruct contract before. We are a gay male couple so perhaps that will make it easier in many ways. I was given some other advice that seemed quite simple (maybe too simple) and wonder if anyone can comment on it:-

Make a loan contract (same value of the property) with the Thai partner and put the deed or property paper as guarantor of the contract. Property

could not be transferred or sold while loan contract is still active.

Does that work....?

Thanks for any words of wisdom

I think that's pretty much what somebody said further up.

If you hold a mortgage for more than the total value of the property, it should be impossible for him to sell or borrow against, and you would hold the FIRST mortgage (same as a bank) which means your debt should be satisfied first. That's the way it happens in Australia, and common sense would dictate that it should be that way in Thailand, but................maybe not?? I can't see why it wouldn't though, because that's the only way a lender can secure the loan. If you don't hold a mortgage for more than the value, and values soar, it may be possible for him to borrow against the extra value, and whilst that doesn't mean you are taken to the cleaners, he will have used your investment to make money for himself. As mortgagor, you should hold the title/certificate/chanote, and that would be best in a bank safe, vault, or perhaps Fort Worth. If your partner is serious, he will understand the need to secure your investment. If he pressures you (why you no lub me?) to put it in his name, unsecured, he is preparing to take you to the cleaners.

Even greater wisdom......rent, rent, rent, rent, rent !!

Are you listening?? Sorry if I seem to be pushing my line hard, but it comes from one who escaped a scam attempt in Bali (a friend I thought I'd known for 20+ years) through rational, not emotional, thinking. Why not rent for a couple of years (rents are cheap enough, and good insurance against thinking with the little head instead of the big head) and see how the relationship goes. If he's up to no good, he may show his true colors by leaving, or it may stand the test of time.

Edited June 11, 2013 by F4UCorsair

[Khun Jean]

The issue is that any contract between husband and wife can be cancelled unilaterally by either party, fine to protect you from greedy relatives should your wife pre-decease you, not fine in the event of divorce.

Currently there is a small doubt in my mind if that is really always the case.

When as a couple you buy a house or land the foreigner has to sign a paper that states the house or land will be the sole property of the Thai. It will therefore will not be part of the sin somros (common) but sin suan tuan. When a Thai rents/usufructs a house or land it is done with property that is 100% property of the Thai and the Thai can do what they want with it. When a usufruct is made it is made over a property that is outside the marriage and as such should also be exempted from 'all contracts with a spouse' rule.

Currently studying this and try to get as much information about it, but it is a slow and difficult process.

[scubachild]

Thanks you all again for interesting feedback. I understand loud and clear about the RENT RENT RENT argument. Just to defend my position I have been living (and renting) in Thailand for 11 years. Living (and renting) together with the same man for 8 years. He is NOT a bar girl Ha Ha or bar boy. He is a university educated accountant. I never do understand why so many farang get involved with prostitutes and then get angry or suprised when investments in the girl (or boy's name) don't work out. But that would be a whole different discussion for a different forum :-)

Why Buy? Because 3m THB in the bank in UK or Thailand cannot earn enough interest to cover the rent and I don't trust the stock market...

[ozyjon]

Get a usufruct contract between you and Thai partner and register at land office. It can be done at land office for a couple hundred baht. The usufruct contract grants the right to use, manage and enjoy benefits of property that is owned by someone else. With a basic agreement the owner of property could still sell the property but buyer cannot cancel the usufruct. You could include language in usufruct to cover selling property but not necessary because no one will buy property with usufruct agreement in place. It gives you the rights of ownership but you do not own the property. I suggest getting one for end of your life rather than a fixed term. The usufruct can be cancelled should owner and you wish to sell property.

Another option is lease but that can only be max of 30 years and taxes for full term of lease must be paid when registered.

If already married then its already to late for any contract.

IT'S THE ONLY WAY,, it's been wrangled a million times (this topic) but that is the answer

[AnotherOneAmerican]

The issue is that any contract between husband and wife can be cancelled unilaterally by either party, fine to protect you from greedy relatives should your wife pre-decease you, not fine in the event of divorce.

Currently there is a small doubt in my mind if that is really always the case.

When as a couple you buy a house or land the foreigner has to sign a paper that states the house or land will be the sole property of the Thai. It will therefore will not be part of the sin somros (common) but sin suan tuan. When a Thai rents/usufructs a house or land it is done with property that is 100% property of the Thai and the Thai can do what they want with it. When a usufruct is made it is made over a property that is outside the marriage and as such should also be exempted from 'all contracts with a spouse' rule.

Currently studying this and try to get as much information about it, but it is a slow and difficult process.

No contract between a husband and wife can be enforced in Thailand, marriage law trumps all.

Usufructs & leases can be cancelled, the document a foreign husband signs at the land office may be challenged.

Who whole point of the 'no contract' law between husband an wife is to prevent one taking unfair advantage of the other.

The the 'sin suan tua' declaration form at the land office is a prime example of on partner taking unfair advantage and therefore easily challenged.

Edited June 12, 2013 by AnotherOneAmerican

[personchester]

Get a usufruct contract between you and Thai partner and register at land office. It can be done at land office for a couple hundred baht. The usufruct contract grants the right to use, manage and enjoy benefits of property that is owned by someone else. With a basic agreement the owner of property could still sell the property but buyer cannot cancel the usufruct. You could include language in usufruct to cover selling property but not necessary because no one will buy property with usufruct agreement in place. It gives you the rights of ownership but you do not own the property. I suggest getting one for end of your life rather than a fixed term. The usufruct can be cancelled should owner and you wish to sell property.

Another option is lease but that can only be max of 30 years and taxes for full term of lease must be paid when registered.

If already married then its already to late for any contract.

IT'S THE ONLY WAY,, it's been wrangled a million times (this topic) but that is the answer

That no one will buy a property with an usufruct agreement is not entirely correct.

Firstly when such a property is for sale its market value is heavily reduced because it is based on the length of the usufruct contract.

As a result the purchaser is able to buy the property cheaply and at the end of the usufruct agreement to he will be able sell the property at the normal market price and makes a profits.

Nevertheless, some of those purchasers use a pressure group team who will start with mild pressure on the usufruct holder in order to make him leave the property, if this does not take place quickly then the pressure group will change their activities severely and harsh to such an extent that the usufruct holder will be happy to leave the house rapidly in order to get away from it.

Thus to sell the house in such a manner is not recommendable, purchasers do exist, therefore the farang and his partner should arrange a private deal that gives them both a sort of advantage.