bankrupt or debtor relatives

[LingLek]

A debtor is registered at a certain address. Under Thai law, is the owner of the house responsible for the debts? In other words, if the debtor defaults, who pays?

[ThaidDown]

The house owner would not normally. be responsible for any debts incurred by someone registered there.

The owner would be jointly responsible if they were the spouse of the debtor or wholly responsible if they had signed as guarantor for the debtor.

Otherwise if the debtor defaults and had not put up any collateral then the courts would be the solution, futile if they have no assets.

[LingLek]

The house owner would not normally. be responsible for any debts incurred by someone registered there.

The owner would be jointly responsible if they were the spouse of the debtor or wholly responsible if they had signed as guarantor for the debtor.

Otherwise if the debtor defaults and had not put up any collateral then the courts would be the solution, futile if they have no assets.

Thanks for that. So: the house-owner is only responsible if he/she guarantees the relative's debts. Otherwise the debtor would be able to give the owner's address for the purpose of her or his ID. I hope I've got that right. Clearly, a worrying issue for an owner both concerned for the well-being of a relative and fearful of the financial consequences.

[klubex99]

In the normal course of Thai justice, if the home owner was a Thai, then the normal law would be observed and carried out.

However, if the home owner were a farang, chances are they would be possibly made to pay up if the creditor could get away with it.

Thai law is very very flexible, and can be twisted in any direction where a farang is concerned.

[hereforgood36]

I think the home owner.

[Farma]

If the loan was obtained from a loan shark and the debtor falls behind in payments, the householder can expect anyone in the house to be held responsible as far as the motorbike collectors are concerned.

Earlier this year an elderly female neighbour suffered a black eye, intimidation and was forced to make payments after her drug/gambling addicted daughter fell behind on a loan shark debt.

[diggledunc]

If the loan was obtained from a loan shark and the debtor falls behind in payments, the householder can expect anyone in the house to be held responsible as far as the motorbike collectors are concerned.

Earlier this year an elderly female neighbour suffered a black eye, intimidation and was forced to make payments after her drug/gambling addicted daughter fell behind on a loan shark debt.

Yes very true. Last year in a village near me a grandmother and the two grandchildren she was looking after had to go into hiding as the motorbike men wanted to kidnap them to help recover a gambling debt from her son.

[iancnx]

Another issue that I have come across (in a previous life) is that family pressure to borrow against a chanote can be enormous. The bank lends the money against the chanote. So if your gf is pressured by family you could find the land you have built on is one day repossessed by the bank..... At best a legal nightmare, at worst you and your gf, wife, son, daughter are homeless.

Keep hold of the Chanote and consider a usefruct, in this case your name is entered on the Chanote, and it instantly becomes useless for raising borrowed funds for unscrupulous family members.

[BEVUP]

Another issue that I have come across (in a previous life) is that family pressure to borrow against a chanote can be enormous. The bank lends the money against the chanote. So if your gf is pressured by family you could find the land you have built on is one day repossessed by the bank..... At best a legal nightmare, at worst you and your gf, wife, son, daughter are homeless.

Keep hold of the Chanote and consider a usefruct, in this case your name is entered on the Chanote, and it instantly becomes useless for raising borrowed funds for unscrupulous family members.

Second parragraph is absolutely untrue

How do i know - because it has happened to me & i have also read that the person whos name the chanoote is in is still the soul owner & controller of said property

The Usufrut only gives you the right to remain on said property to USE as in Usufrut & Frut as in to improve to your benefit

[iancnx]

Another issue that I have come across (in a previous life) is that family pressure to borrow against a chanote can be enormous. The bank lends the money against the chanote. So if your gf is pressured by family you could find the land you have built on is one day repossessed by the bank..... At best a legal nightmare, at worst you and your gf, wife, son, daughter are homeless.

Keep hold of the Chanote and consider a usefruct, in this case your name is entered on the Chanote, and it instantly becomes useless for raising borrowed funds for unscrupulous family members.

Second parragraph is absolutely untrue

How do i know - because it has happened to me & i have also read that the person whos name the chanoote is in is still the soul owner & controller of said property

The Usufrut only gives you the right to remain on said property to USE as in Usufrut & Frut as in to improve to your benefit

Sorry to hear you don't agree. There is no bank on earth that is going to lend money against a chanot that has a lifetime usefruct endorsement. IMHO. Why would they? Unless of course the usefruct grantee is in his nineties.

[ThaidDown]

As said, having an Usufruct registered on the Chanote does not stop the owner trying to borrow against the property. Legitimate lenders are,however, unlikely to lend, since in the case of default the lenders would be unable to sell the land to recover their loan.

'Other' lenders may lend, and ,depending on the amount involved, would get their money back when the users of the land vacated it, or the usufruct lapsed due to the holders death.

[iancnx]

As said, having an Usufruct registered on the Chanote does not stop the owner trying to borrow against the property. Legitimate lenders are,however, unlikely to lend, since in the case of default the lenders would be unable to sell the land to recover their loan.

'Other' lenders may lend, and ,depending on the amount involved, would get their money back when the users of the land vacated it, or the usufruct lapsed due to the holders death.

Thanks, this is a clearer more concise explanation of the point I was trying make. Cheers

[how241]

Lawyers are cheap so I would recommend talking to one.

[Globeman]

In the normal course of Thai justice, if the home owner was a Thai, then the normal law would be observed and carried out.

However, if the home owner were a farang, chances are they would be possibly made to pay up if the creditor could get away with it.

Thai law is very very flexible, and can be twisted in any direction where a farang is concerned.

Let's put the farang persecution complex aside for a moment, shall we? The bulls**t flows down the paths of least resistance here regardless of nationality. They'll try it on with anybody. Most Thais are not that au fait with the law - and a lot of them are gullible (same as most countries).

My landlord was Thai (with a house on the same compound) and when we ran into credit card debt problems a couple of years back and moved elsewhere (no, not on the run), the creditors' goons came to visit the house and tried to convince the landlady that she was responsible. They were acting as if they owned the place (for 90k baht of debt), and listing off the pieces they saw in the house that they'd be taking away.

Not only did the landlady not know the law, she, like a lot of Thais, has a pronounced fear/respect for power (kreng jai) - such as the thuggish "representatives" of a major bank - and of course wasn't sure if the police would fall onto her side of the issue if she called them, given the size and connections of the institution she was up against (the police also know what side butters their bread). If these bullies started hauling away her TV and furniture, what could she do? Of course few think of calling a lawyer (or even having the number of a lawyer on hand)... And in the case of my Chi-Thai landlady, having to spend a couple of thousand baht on a lawyer would be unthinkable, since money spent is money wasted, (if she'd called us at the time, we could have put our lawyer on the case). In the end, she convinced them not to take stuff away that day, called us a couple of days later, and we got the lawyer onto it, who made one call - no charge - telling them to lay off the landlady or face legal action, They left her alone after that.

[diggledunc]

Another issue that I have come across (in a previous life) is that family pressure to borrow against a chanote can be enormous. The bank lends the money against the chanote. So if your gf is pressured by family you could find the land you have built on is one day repossessed by the bank..... At best a legal nightmare, at worst you and your gf, wife, son, daughter are homeless.

Keep hold of the Chanote and consider a usefruct, in this case your name is entered on the Chanote, and it instantly becomes useless for raising borrowed funds for unscrupulous family members.

Yes I have seen this a lot. There is however a government sponsored organisation who help people in this position for free. I know there is an office in Nakhon Phanom which covered a lot of Isan. They helped farmers who were uneducated and yes gave the chanote as security maybe to children and whatever failed so the banks came. Met a lady who worked for them but can't remember what they were called. They helped a lot of people though and went to court on their behalf to try and prevent land seizures. They also had farang volunteer support.