Usufruct

[Sunbelt Asia]

Since there ain't no Constitution at the moment , us farangs can be treated any way they want with impunity.

Except, the USA may have something to say about that, by using the threat of punishment of no more aid to Thailand. The question is “Would that indirect punishment even matter?”

By the way, how big is your mango tree? I have heard of fights over much less. A bing cheery tree, now that is worth going all the way to the Supreme Court! The problem with a right of habitation is you cannot enjoy the fruit! A usufruct allows you to eat it all !

www.sunbeltasiagroup.com

[sinam]

Speaking of spouses a new mate of mine who happens to have a spouse, told me he went in to see a lawyer last week and for a tidy sum the lawyer ended up telling him to forget about the lease route with a spouse as it may not hold up in court (in a spouse context)

What route did he recommend then?

I caught up with my mate and asked him how his legal consultations were going. The last time I talked to him his lawyer wasn't too high on the lease or company route. The Usufruct wasn't even mentioned so I mentioned he might want to ask about that the next visit but he’s feeling his lawyer isn’t high on any of them. My personal thoughts for whatever they may be worth is that I don't understand why people go to a lawyer without educating himself or herself a bit first especially here in Thailand where things are in a constant state of flux. Just showing up in Thailand and walking into a lawyer’s office and asking the question, "How do I buy land in Thailand?” when you know the Thai Gov't doesn't want you to, is just mind boggling in my opinion.

At this point in time my suggestion to my mates is, if you have a wife and work in Thailand (or have regular income) is to go the mortgage route. Put a down payment (with your wife if you’ve actually spent time looking for one with a career), and then buy yourself a free hold condo on the beach with the money you would have used to buy the house outright. You have your retirement/weekend/holiday home in place already (and another asset) and a house to live in during your working years (or some of them if you are really pessimistic :-) Maybe a lot of people don't fit that situation but you do need to research and think long and hard before you walk in that lawyer's office and ask that owning land question. Of course that's not to discourage you from seeing lawyers on related matters like wills and prenups, which you want in place rather early in the process…

Si Nam

[~G~]

Since there ain't no Constitution at the moment , us farangs can be treated any way they want with impunity.

Except, the USA may have something to say about that, by using the threat of punishment of no more aid to Thailand.

Yes, it is a top US interest - all Americans who try to bend Thai laws and own land through this loophole or another should be able to so at will. Extremely important, vital for world democracy, Absolute Justice and God's will. In case of Thailand actually enforcing its laws by the underlying principles (=no foreign ownership of land), the country will quickly be included in the Axis of Evil, together with Iran and North Korea.

[Sunbelt Asia]

Since there ain't no Constitution at the moment , us farangs can be treated any way they want with impunity.

Except, the USA may have something to say about that, by using the threat of punishment of no more aid to Thailand.

Yes, it is a top US interest - all Americans who try to bend Thai laws and own land through this loophole or another should be able to so at will. Extremely important, vital for world democracy, Absolute Justice and God's will. In case of Thailand actually enforcing its laws by the underlying principles (=no foreign ownership of land), the country will quickly be included in the Axis of Evil, together with Iran and North Korea.

Gees G it was a joke. It had nothing to do about land. Dragonman was talking about life in general with impunity. Example: The military forced all restaurants to serve farangs rice instead of potatoes. No one in the military could get in trouble now doing this. Could only the threat of USA aid being stop, is why its not happening?

[~G~]

Since there ain't no Constitution at the moment , us farangs can be treated any way they want with impunity.

Except, the USA may have something to say about that, by using the threat of punishment of no more aid to Thailand.

Yes, it is a top US interest - all Americans who try to bend Thai laws and own land through this loophole or another should be able to so at will. Extremely important, vital for world democracy, Absolute Justice and God's will. In case of Thailand actually enforcing its laws by the underlying principles (=no foreign ownership of land), the country will quickly be included in the Axis of Evil, together with Iran and North Korea.

Gees G it was a joke. It had nothing to do about land. Dragonman was talking about life in general with impunity. Example: The military forced all restaurants to serve farangs rice instead of potatoes. No one in the military could get in trouble now doing this. Could only the threat of USA aid being stop, is why its not happening?

This thread is not about the USA, but since you brought it up, why be surprised if others make their own jokes?

[Sunbelt Asia]

I caught up with my mate and asked him how his legal consultations were going. The last time I talked to him his lawyer wasn't too high on the lease or company route. The Usufruct wasn't even mentioned so I mentioned he might want to ask about that the next visit but he’s feeling his lawyer isn’t high on any of them. My personal thoughts for whatever they may be worth is that I don't understand why people go to a lawyer without educating himself or herself a bit first especially here in Thailand where things are in a constant state of flux. Just showing up in Thailand and walking into a lawyer’s office and asking the question, "How do I buy land in Thailand?” when you know the Thai Gov't doesn't want you to, is just mind boggling in my opinion.

Big difference between owning land and leasing or having servitude. One a foreigner cannot do, which is owning land unless he has 40 million Baht or inherits one rai and the Minister allows it. The other which is leasing or servitude can be done by a foreigner. If anyone can show where in the law, it states different, please do.

At this point in time my suggestion to my mates is, if you have a wife and work in Thailand (or have regular income) is to go the mortgage route. Put a down payment (with your wife if you’ve actually spent time looking for one with a career), and then buy yourself a free hold condo on the beach with the money you would have used to buy the house outright. You have your retirement/weekend/holiday home in place already (and another asset) and a house to live in during your working years (or some of them if you are really pessimistic :-) Maybe a lot of people don't fit that situation but you do need to research and think long and hard before you walk in that lawyer's office and ask that owning land question. Of course that's not to discourage you from seeing lawyers on related matters like wills and prenups, which you want in place rather early in the process…

The problem is most banks in Thailand require the foreigner to sign for the mortgage, as the Thai wife in most cases cannot qualify. So with divorce you don’t get to stay in the house but you do get the bill from the bank. Sounds like a good arrangement.

Now I understand exceptions do exist, my wife is in fact one. She owns three properties with land (she rents them out) and I did not need to sign anything for her. In fact, I found out only after she bought it. Talk about being independent!

If you ever want to see the biggest critic on owning any real estate anywhere in the world, it’s me! I prefer to lease! Like the house we live in, if we bought and rented it out what we pay now for rent, the yield would be .0028% not a typo, its not even 1%! ( Most real estate has a yield of 6 to 8% annually in Thailand)

To sum it up, if you want the safest way to not be kicked out, register a long term lease or servitude with the land owner. I’m all ears if someone can show how doing this is a loophole for foreigners; remember you do not own the land. Anybody rent a house in Thailand? It’s the same principle just for a longer term. You have the right to stay there, rent it out but you do not have the right to sell the land as its not yours!

www.sunbeltasiagroup.com

[Sunbelt Asia]

This thread is not about the USA, but since you brought it up, why be surprised if others make their own jokes?

Wasn't sure if you were joking as well. Just letting you know it was to be funny. Problem with writing, no ones tongue in cheek comes out.

www.sunbeltasiagroup.com

[bisop]

I think the problem with using the leasing route is that the owner can sell your land and then you would have dificulty renewing the lease.

The problem with the usufruct would be if the person who's name it is in dies you would be left with nothing.

Can the usufruct be put in 2 or more names? Do you need the land owners consent to renew/start a new lease? I there any other way to extend the timeframe out past the death of the person who owns the usufruct?

[Sunbelt Asia]

The problem with the usufruct would be if the person who's name it is in dies you would be left with nothing.

If you mean the land owner, it is still valid.

If you mean only yourself, you are dead and have nothing anyway. If you had issue a 30 year lease to a third party, then it does not end on your death.

Can the usufruct be put in 2 or more names? ?

Yes

Do you need the land owners consent to renew/start a new lease?

Depends on the contract. The land owner however has to bring the title deed to the land office for you to register any lease longer than 3 years.

I there any other way to extend the timeframe out past the death of the person who owns the usufruct?

Register a 30 year lease. If you are still alive along with the land owner after 30 years, register another 30 years to the third party.

Also put more than one person on the usufruct.

www.sunbeltasiagroup.com

[sinam]

The problem is most banks in Thailand require the foreigner to sign for the mortgage, as the Thai wife in most cases cannot qualify. So with divorce you don’t get to stay in the house but you do get the bill from the bank. Sounds like a good arrangement.

Even covertly using the tried and tested lawyer fear mongering technique I think you hit the nail on the head. If guys spent as much time finding a decent wife as they do trying to get around the law then they wouldn’t need to see you :-)

“In most cases” is an interesting assumption. I guess one would have to put that into the context of the typical client who comes through your door? I guess it’s the company you keep but I can only think of a couple of lads who pay the whole shot in my circle of friends.

Get a mortgage and buy a condo. The mortgage is no more than the rent you paid for an apartment (less in my case). The wife can have the house if it turns to that - “in most cases” she will probably deserve at least that :-)

Si Nam

P.S. If you are the worrying type you can buy mortgage or job/health insurance for various senarios. The banks are really pushing this, mostly as another revenue stream but also to cover themselves for events like foreigners not coming back after a border run…

[Sunbelt Asia]

Even covertly using the tried and tested lawyer fear mongering technique I think you hit the nail on the head. If guys spent as much time finding a decent wife as they do trying to get around the law then they wouldn’t need to see you :-)

Even if someone search the planet and married Mother Teresa or did no research and married a girl who has gone with 5,336 guys from Nana plaza. You better have good legal advice because unfortunately everyone is human and one day we die. The fact is Mother Teresa can have bad relatives even though she herself was a saint. Death is certain while divorce is a possibility.

Also even if Mother Teresa had the best relatives, what about the title deed search? Something most people don't bother about and some have had many problems because they didn't do something so simple. Most think " Oh the seller is such a nice old man. He'll lose face if I check it" How bout the review of the agreement or registration at the land dept. All items that still should be checked, if you were married to Mother Teresa and her relatives who are saints.

Get a mortgage and buy a condo. The mortgage is no more than the rent you paid for an apartment (less in my case). The wife can have the house if it turns to that - “in most cases” she will probably deserve at least that :-)

If you bought the condo before you were married (not with income earned during the marriage and had a pre-nuptial) while making house payments with a mortgage. This arrangement may work out. If you are satisfied she can have the house no matter what happens.

www.sunbeltasiagroup.com

[Dragonman]

I think the problem with using the leasing route is that the owner can sell your land and then you would have dificulty renewing the lease.

The problem with the usufruct would be if the person who's name it is in dies you would be left with nothing.

Can the usufruct be put in 2 or more names? Do you need the land owners consent to renew/start a new lease? I there any other way to extend the timeframe out past the death of the person who owns the usufruct?

There are even greater problems with co-ownerships of usufructs than with single.

Case law in other countries, which form the basis for the Thai Civil Code, and hence amendment to Civil Codes, has established that co-ownerships may only be for 30 years, as a life term cannot be established. Also the usufruct is ended on the death of one of the co-owners. There are also problems such as if the co-owners "fall out" there is a need for some kind of Berlin Wall.

[Khun Jean]

The simple solution to all this headache giving constructions is to buy a place in your own country (or not sell it before you come here).

Rent it out and use the money to rent a very nice house here.

[geoffphuket]

The simple solution to all this headache giving constructions is to buy a place in your own country (or not sell it before you come here).

Rent it out and use the money to rent a very nice house here.

Hindsight is a wonderful thing – I wish I done that 10 years ago, my old house back in the Uk is worth a fortune now

[dsfbrit]

Just trying to clarify a subtlety here. Can anyone help??

I know a 30 year lease can be set up so that the land is in the Thai owners name and the house is in the Farangs name. This means the Farang can modify the house as he pleases without recourse to the owner.

However, does a liftetime Usufruct mean both the house and land have to be in the Thai owners name or can it also be split into the Thai owning the land and Farang owning the house.

Perhaps this is a redundant question if in fact the farang with the Usufruct has total control over the land and house anyway, ie: can modify the house as he pleases. Is this the case ?

thanks for any feedback

[digitele]

Just trying to clarify a subtlety here. Can anyone help??

I know a 30 year lease can be set up so that the land is in the Thai owners name and the house is in the Farangs name. This means the Farang can modify the house as he pleases without recourse to the owner.

However, does a liftetime Usufruct mean both the house and land have to be in the Thai owners name or can it also be split into the Thai owning the land and Farang owning the house.

Perhaps this is a redundant question if in fact the farang with the Usufruct has total control over the land and house anyway, ie: can modify the house as he pleases. Is this the case ?

thanks for any feedback

The house or structure is seperate from the land under Thai law. If the lease agreement is written correctly you can do as you please in a lawful manner. Your Usufruct question about land / house modifications. Changing the house etc.

Once again, if your agreement is written correctly and it's legal you should be good to go. It's your structure.

Hopefully, some more experienced "Thai Hands" will have some ideas on this, but I think you'll be fine.

Good Luck

[Sunbelt Asia]

However, does a liftetime Usufruct mean both the house and land have to be in the Thai owners name or can it also be split into the Thai owning the land and Farang owning the house.

In most cases the land office will not allow the separation of the land and house if the grantor of the usufruct is the seller of the house.

Example: A Thai buys the house and land. The new Thai owner grants a usufruct to the foreigner on the land and then sells the house to him. This won't work as the officer won't approve it because of two reasons... lower tax rate and they may feel it’s a circumvention of the law for the Thai to hold land on behalf of the foreigner.

.

Solution: If a house and land is for sale. The sale of the land is transferred to a Thai buyer who then issues the usufruct to the foreigner. A separate sales contract for the house is then between the foreigner buyer from the original seller. This method is approved in most cases but still with some officers could be a problem as they feel the tax was too low on the land( without the house.)

Another solution: The Thai owner (seller) registers a short-term lease for the land to the foreigner. The seller sells the house to the foreigner. Later, the Thai seller sells the land to a Thai buyer who on the following day cancels the short term lease to the foreigner and registers a usufruct for the foreigner at the same time.

Third solution: The foreigner simply builds a house after being granted the servitude of the usufruct.

www.sunbeltasiagroup.com

[dsfbrit]

Thanks very much for the feedback digitele and Sunbelt. The land and house are currently under a dodgy company structure so I would be unable to separate land and house in that scenario anyway I would guess ?

[tutsiwarrior]

does anyone know of a case where the thai owner decides not to honor the usufruct agreement and has attempted, sucessfully or unsuccessfully, to evict the falang usufructee by using local muscle or by other means? I'm thinking of the axiom that whenever there is a thai/falang dispute the thai always wins...

[bendix]

There are always risks like that tutsi, but they're pretty slight.

I'm definitely using a lifetime usufruct on the place i'm in the process I'm buying in HH. I think i'd be daft not to. It gives me protection for life, EVEN if my wife dies before me.

Hearty congratulations to Sunbelt for their patience explaining this.

One thing that hasnt appeared in this thread yet. Sunbelt has rightly said that the cost of registering the usufruct at the Land Office is 1.5%. However, if the person granting the usufruct is your legal wife, it's less than a hundred baht, irrespective of the price of the property,

[digitele]

Thanks very much for the feedback digitele and Sunbelt. The land and house are currently under a dodgy company structure so I would be unable to separate land and house in that scenario anyway I would guess ?

Land = Get a lease. The Thai leasing you the land. That's 1st. Then you build and record / visit the land office yourself.

Once you build a structure = Thai will get a Blue book, not yellow. You should be shown in that book as the only occupant.

If it's done correctly. I like the Sunbelt folks; but as legal advisors, they need fees.

They recommended the company route to me 2 years ago. We, wife (Thai/USA) and I didn't know. We didn't

Lease. Build with document, check all again and again. Thai will have 2 register the structure. Make sure you are on it.

Good Luck! If you have no contacts, reliable translators, go with SunBelt under the basic outline.

[Sunbelt Asia]

Thanks very much for the feedback digitele and Sunbelt. The land and house are currently under a dodgy company structure so I would be unable to separate land and house in that scenario anyway I would guess ?

Possible but depends if you or (your wife) are a director, then the company could not sell the house to you or register the usufruct in your name till you or your wife were removed as the director.

Land = Get a lease. The Thai leasing you the land. That's 1st. Then you build and record / visit the land office yourself.

Once you build a structure = Thai will get a Blue book, not yellow. You should be shown in that book as the only occupant.

If it's done correctly. I like the Sunbelt folks; but as legal advisors, they need fees.

They recommended the company route to me 2 years ago. We, wife (Thai/USA) and I didn't know. We didn't

Lease. Build with document, check all again and again. Thai will have 2 register the structure. Make sure you are on it.

Good Luck! If you have no contacts, reliable translators, go with SunBelt under the basic outline.

Thanks. You are right, two years ago the landscape was sure different than it is today.

Hearty congratulations to Sunbelt for their patience explaining this.

One thing that hasnt appeared in this thread yet. Sunbelt has rightly said that the cost of registering the usufruct at the Land Office is 1.5%. However, if the person granting the usufruct is your legal wife, it's less than a hundred baht, irrespective of the price of the property,

You are welcome. As for the cost at the Land Dept., it just depends on the mininum tax they will accept in the real World. It should be with a Thai wife just 100 baht but they just won't do now in most cases. They want to see a much higher tax obligation.

www.sunbeltasiagroup.com

[bendix]

You are welcome. As for the cost at the Land Dept., it just depends on the mininum tax they will accept in the real World. It should be with a Thai wife just 100 baht but they just won't do now in most cases. They want to see a much higher tax obligation.

www.sunbeltasiagroup.com

With respect, Sunbelt, that directly contradicts what one of your own people told me just two weeks ago. It would help to get some consistent advice because it's a pretty fundamental issue.

[Sunbelt Asia]

You are welcome. As for the cost at the Land Dept., it just depends on the mininum tax they will accept in the real World. It should be with a Thai wife just 100 baht but they just won't do now in most cases. They want to see a much higher tax obligation.

www.sunbeltasiagroup.com

With respect, Sunbelt, that directly contradicts what one of your own people told me just two weeks ago. It would help to get some consistent advice because it's a pretty fundamental issue.

That’s understandable because the law should be black and white but sometimes its not. It’s easy to state black and white and what should be the case if the law is applied if it’s black and white. However at the Land Dept, some officers are the law that make their own laws on how they feel black and white should be. The bottom line it could be 100 Baht, some clients havei n fact had it done for this amount in tax but others simply was not allowed to register the usufruct for this amount of tax. It just comes down to the officer so you have plan A and know you may need Plan B.

www.sunbeltasiagroup.com

[george]

What documents does a (foreigner) usufruct holder need in order to apply for a Yellow Tabien Ban?

Is a certified copy of passport ok, or does it need to be translated and certified by the Ministry of Foregin Affairs?