Buying Chanote Land And House In Thai Partners Name

[jpinx]

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...

Interesting take on this topic. Thanks for the background as that clears up a lot of otherwise murky details. I wonder why you think buying land will generate more income than term bank deposits? Your accountant partner will have a pretty good insight into the Thai financial markets I presume? Putting all your money into a plot of land is not something I would contemplate in any circumstance --- unless you've found buried treasure

[Hunter88]

Been there, done this. If it's your money and your buying in a Thai name, do the following. Have your lawyer do or do yourself a contract showing that the Thai is taking out a mgt. form you to be paid back over 30 years. Have this and a lease giving you the rights to live in the house for the same 30 years. The land office attaches both to the Chanote, The property cannot be sold until the lease is revoked and the mgt. paid. Of course there really is no money being paid on the mgt. But it does assure you that your investment is strong. Best to use a lawyer.

[manarak]

The company route is safer.

If some day Thailand decides to crack down on company-owned land, you will be given some time to sell the land.

Then sell the land to your partner and keep the house.

[hanuman2543]

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 !

If he is really pissed, he should try and sue her in a criminal court, but more money and more time.

[F4UCorsair]

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...

Interesting take on this topic. Thanks for the background as that clears up a lot of otherwise murky details. I wonder why you think buying land will generate more income than term bank deposits? Your accountant partner will have a pretty good insight into the Thai financial markets I presume? Putting all your money into a plot of land is not something I would contemplate in any circumstance --- unless you've found buried treasure

Here's a strategy worth exploring.

An individual from outside Australia, if invested in Australian shares, must pay tax on capital gains and dividends. A foreign registered company, if invested in Australian shares, and owning less than 10% of the paid up capital of any company, may take capital gains and dividends from that/those company/companies tax free!! It's an anomaly in the law, has existed for years, and is unlikely to be shut down.

So.....form a company in Thailand and invest your B3 Million in Australian banks, principally CBA. You will get about 6% dividend before franking credits if you can make any use of them.

Then rent!!

You seem to be in a stable, long term relationship, but please take nothing for granted. Secure your investment if you buy, and if your partner doesn't want to go along with your efforts to do so, then there is a strong smell of rat associated with the whole affair.

There must be hundreds of stories on TV of foreigners being taken to the cleaners. Please be careful.

Edited June 12, 2013 by F4UCorsair

[jpinx]

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...

Interesting take on this topic. Thanks for the background as that clears up a lot of otherwise murky details. I wonder why you think buying land will generate more income than term bank deposits? Your accountant partner will have a pretty good insight into the Thai financial markets I presume? Putting all your money into a plot of land is not something I would contemplate in any circumstance --- unless you've found buried treasure

Here's a strategy worth exploring.

An individual from outside Australia, if invested in Australian shares, must pay tax on capital gains and dividends. A foreign registered company, if invested in Australian shares, and owning less than 10% of the paid up capital of any company, may take capital gains and dividends from that/those company/companies tax free!! It's an anomaly in the law, has existed for years, and is unlikely to be shut down.

So.....form a company in Thailand and invest your B3 Million in Australian banks, principally CBA. You will get about 6% dividend before franking credits if you can make any use of them.

Then rent!!

You seem to be in a stable, long term relationship, but please take nothing for granted. Secure your investment if you buy, and if your partner doesn't want to go along with your efforts to do so, then there is a strong smell of rat associated with the whole affair.

There must be hundreds of stories on TV of foreigners being taken to the cleaners. Please be careful.

That's very convoluted and there's possibly lots of fees and charges involved. There are banks in Oz and NZ who will pay out reasonable term deposit rates with minimum tax liability for non-residents.

[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.

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.

You mean that the Thai spouse has an unfair advantage and it can be challenged?

[HughJass]

rent rent rent rent...............or if u must buy then buy a condo in your name............why take the risk.?

[Khun Jean]

Well the OP is a woman, so she could just marry and obtain Thai citizenship.

Problem solved.

[scubachild]

Well the OP is a woman, so she could just marry and obtain Thai citizenship.

Problem solved.

As I have said we are a gay male couple. Seems like one of the few times lack of equality in the law works in our favour ...

[F4UCorsair]

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...

Interesting take on this topic. Thanks for the background as that clears up a lot of otherwise murky details. I wonder why you think buying land will generate more income than term bank deposits? Your accountant partner will have a pretty good insight into the Thai financial markets I presume? Putting all your money into a plot of land is not something I would contemplate in any circumstance --- unless you've found buried treasure

Here's a strategy worth exploring.

An individual from outside Australia, if invested in Australian shares, must pay tax on capital gains and dividends. A foreign registered company, if invested in Australian shares, and owning less than 10% of the paid up capital of any company, may take capital gains and dividends from that/those company/companies tax free!! It's an anomaly in the law, has existed for years, and is unlikely to be shut down.

So.....form a company in Thailand and invest your B3 Million in Australian banks, principally CBA. You will get about 6% dividend before franking credits if you can make any use of them.

Then rent!!

You seem to be in a stable, long term relationship, but please take nothing for granted. Secure your investment if you buy, and if your partner doesn't want to go along with your efforts to do so, then there is a strong smell of rat associated with the whole affair.

There must be hundreds of stories on TV of foreigners being taken to the cleaners. Please be careful.

That's very convoluted and there's possibly lots of fees and charges involved. There are banks in Oz and NZ who will pay out reasonable term deposit rates with minimum tax liability for non-residents.

It is convoluted, and there shouldn't be excessive fees, particularly since the partner is an accountant.

Imagine if you'd bought CBA shares under this arrangement when they floated at $7.00, and you were now being paid $3.60 dividends pa!!! Tax free!! They're now $65.00, so not nearly as good, but still a lot more than banks are paying, and you must pay tax on interest when above the tax free threshold. I think, without any research, that 4% would be as good as you'd get right now, and you may even do a lot better in Thai banks??

I threw it into the mix for no reason other than it's another consideration.

[Khun Jean]

Well the OP is a woman, so she could just marry and obtain Thai citizenship.

Problem solved.

As I have said we are a gay male couple. Seems like one of the few times lack of equality in the law works in our favour ...

Ah, well that is actually a bonus because then you are protected (In Thailand) against marriage.

Specific in Thailand it is a reason why foreigners have to sign away their most expensive asset. When not being married this is not demanded by the government and you can really protect your assets. Share it when you want to.

When you buy something just get a usufruct. Cost a few hundred baht and is as good as it gets in Thailand.

The choice is for a certain time frame, maximum 30 years. Or choose for the duration of your live.

[jcnbkk]

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.

And these loan contracts are successfully enforced? Anyone been through it?

[jpinx]

Has anyone successfully pursued the default option in any kind of loan contract with property as the security between a farang and a thai? I have not see any threads about such an outcome in here.........

[jpinx]

............but I do see stories like this one

http://www.thaivisa.com/forum/topic/644485-australian-farmer-files-b15m-fraud-charge-against-thai-fiance/page-14#entry6508725

[personchester]

I made such a loan contract, but have no need to act on it.

I know of two fellows who also made loan contracts to their wife's, then things went wrong marriage-wise and they demanded the money back, one house was sold within the year and he got the money back.

The other fellow's house could not sold within the year, as a result the land office gave the ownership of the house provisonally to the farang for one year, but again the house must be sold within one year, if it has not been sold within the year then the government takes the ownership of the property.

In order to avoid this the fellows should find a new girl, make a loan contract with them, then go to the land office and get her name as owner on the Deeds (Chanots)

I know one chap who had no loan contract with his wife and was kicked out of the house by her, he eventually went to a lawyer proved to him that he paid the entire purchase price of the house, the case went to court on several occasions, it took two years +, at the end the money outcome result was 60/40 (60% for him) but the legal costs left not much money at the end for either of them.

Thus the best way is to provide a loan contract with the partner, prior to purchasing the house.

[cheeryble]

Kuhn Jean

See your point entirely.

I am sure I was told the story by an Italian chap who wanted to come to an agreeable split up of the property....several rai with a building or two on it.....in her name when they went separate ways. The money had come from him. She refused, and wanted the lot. He went to LO and/or court to say I'm sorry some years ago I did something I now know was against the law, I provided money to my wife to buy the land. He said the transfer was annulled and the land had to be put on the market (enforced sale in 6 months or one year) with the proceeds going to him. (som nam naa?)

Is this relevant to your cogitations?

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.

Couldn't an addendum to the sales contract or a self standing contract agree the registered owner will not sell the property for the length of the usufruct? Couldn't it be connected as a lien on the back of the chanods?

[cheeryble]

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).

No such thing as a usufruct stamp it would be a lien on the back of the chanod referring to a usufruct agreement

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.

It does not take away her right to sell.

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

....and pay taxes on the rental

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

That would be if you don't care about your wife's future.

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.

Perhaps we could all say we don't understand contracts and get out of anything? Tear up all contracts now!__________I've read some misleading posts on TV, but yours is up there........ Edited June 17, 2013 by cheeryble

[AnotherOneAmerican]

<deleted>,

My wife could not even add a her name to a new piece of land she got without me going down to the land office and signing to say I am aware of what she is doing. This land had nothing to do with me, yet as he husband, I was required to be aware of it.

The only reason you were required at the land office, was for you to sign a paper saying you (foreigner) would make no claim on the land.

If she were selling land they don't want or need you. (as you have already signed a document saying not yours)

[cheeryble]

<deleted>,

My wife could not even add a her name to a new piece of land she got without me going down to the land office and signing to say I am aware of what she is doing. This land had nothing to do with me, yet as he husband, I was required to be aware of it.

The only reason you were required at the land office, was for you to sign a paper saying you (foreigner) would make no claim on the land.

If she were selling land they don't want or need you. (as you have already signed a document saying not yours)

May be because couples have to both be OK with any financial encumbrances and that may extend to transactions like buying land.

It's a great excuse not to get officially married.

[personchester]

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.

<deleted>,

My wife could not even add a her name to a new piece of land she got without me going down to the land office and signing to say I am aware of what she is doing. This land had nothing to do with me, yet as he husband, I was required to be aware of it.

I gave my wife money by bankers draft (cashiers cheque) on several occasions to buy land, I always went with her to the land office, then would sit in a chair meters away from the registration desk where my wife and the land seller signed the official deeds (chanots) to transfer the ownership.

I was never required to be aware of the purchase, nor required to be aware of any sales.

But if one wants to be part of it, go with your wife to the registration desk and sign that you are aware of it, and agree, but it is not a requirement and of no importance, because your wife is entitled to purchase and the only official owner of the purchase.

Edited June 18, 2013 by personchester

[Khun Jean]

She probably used her Thai ID card with her Thai maiden name on it and also her title would still be of an unmarried woman. She was probably not asked if she was married because of that. She should however state that she is married, with a foreigner. Lacking to do that is fraud by intent.

That can come back to bite her/you.

Edited June 18, 2013 by Khun Jean

[Sophon]

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.

<deleted>,

My wife could not even add a her name to a new piece of land she got without me going down to the land office and signing to say I am aware of what she is doing. This land had nothing to do with me, yet as he husband, I was required to be aware of it.

You were not signing that you were aware of her acquiring land, you were signing that you have no claim to the land. This is because foreigners cannot own land, and if your wife is buying land it would be half yours, unless you sign to the fact that the land is hers alone.

The post you replied to is talking about selling land or taking a loan on the land. Neither of these actions brings a risk of foreign ownership of the land, so cannot be compared to what you experienced.

Sophon

[AnotherOneAmerican]

She probably used her Thai ID card with her Thai maiden name on it and also her title would still be of an unmarried woman. She was probably not asked if she was married because of that. She should however state that she is married, with a foreigner. Lacking to do that is fraud by intent.

That can come back to bite her/you.

ID card contains full Thai marital status, either they married abroad and didn't register in Thailand, or poster doesn't understand village wedding isn't really married.

Edited June 18, 2013 by AnotherOneAmerican

[Khun Jean]

I should have said 'old ID card'. Many are still worried, even though the law changed already many years ago, that they can not own land when married to a foreigner.

Village knowledge stays unchanged for a long long time.