Selling a house on "terms"

[patongphil]

I have just received an offer for my house. The price is fine but the purchaser wants to put a deposit down and pay the remaining off over the next 12 months.

Has anyone had any experience of this in Thailand and any possible exposures for myself?

Not concerned about any interest etc just how to actually go about setting such a deal up protecting myself.

Any advice, experience, possible pitfalls etc welcome.

[BaldPlumber]

Generally speaking, if he's good for the money, a bank is probably the place he should go for a loan and not a private seller.

Why would you even entertain such a proposition?

Sent from my SM-T116BU using Tapatalk

[beachproperty]

I don't see a problem.....Take the deposit and next 12 months payments ....THEN give him the chanote....

[Farma]

The wife has sold properties this way and her family and friends have bought and sold this way too.

if memory serves me right a deposit was paid with x number of payments over x months.

it was registered at the land office and property transferred at land office on final payment.

[swissie]

Generally speaking, if he's good for the money, a bank is probably the place he should go for a loan and not a private seller.

Why would you even entertain such a proposition?

Sent from my SM-T116BU using Tapatalk

Yes, why indeed. If the buyer is not able to secure a loan from a bank, tell him to go fly a kite.

Cheers

[swissie]

I don't see a problem.....Take the deposit and next 12 months payments ....THEN give him the chanote....

A Chanote is a land title. So, the burning question is: In what name is the land?

Cheers.

[blackcab]

I don't see a problem.....Take the deposit and next 12 months payments ....THEN give him the chanote....

Just like beachproperty said. You will obviously need a contract which would include a clause stating that all payments are due with one year, and if the payments are not made in full and on timr the buyer forfeits all monies previously paid.

Very fair, and it should sharpen the buyers mind somewhat.

[mcfish]

Also draw up a contract stating that the house will be repossessed if he defaults on a payment.

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[technologybytes]

I have sold two properties in this way, the important thing is that the buyer needs to be clear that the chanote will not be transferred until the whole amount has been paid.

Really its the buyer who takes all the risk, as a seller you cannot go wrong provided you use due diligence to ensure the buyer has the means to pay, that there is a substantial deposit and that the issue of not getting any title until its all paid is totally clear.

[williamgeorgeallen]

Generally speaking, if he's good for the money, a bank is probably the place he should go for a loan and not a private seller.

Why would you even entertain such a proposition?

Sent from my SM-T116BU using Tapatalk

Yes, why indeed. If the buyer is not able to secure a loan from a bank, tell him to go fly a kite.

Cheers

wrong. take the deposit, hold the title until you get the balance. friend of mine sold a condo, took the deposit, guy never paid the balance and he got to sell it again.

[Sharp]

As said.

1. Substantial deposit.

2. Ownership only transferred on final payment

3. Failure to complete the buyer forfeits payments already paid and without recourse of any sort.

I have actually done this several times and it got messy on one occasion for the Purchaser but due to my Lawyer drawing up a secure contract it eventually went through as soon as the buyer realised they were REALLY going to lose their already paid funds.

Good luck

Oh and make sure you make terms and conditions of what exactly the Purchaser can and can't do in the property if occupancy is taken over prior to completion

Edited March 1, 2016 by Sharp

[SOUTHERNSTAR]

It is a general practice in Thailand to buy property in such a way. You must do the following:

Draw up an agreement that stipulate the terms of the agreement, property description, parties to the agreement, purchase price, deposit, term of payment and most important what happens incase he fails to pay. We normally will include a clause that gives him an additional 3 months after the final payment date to come up with the money, if he cant he lose everything he has paid. Best is to have it drawn up by a laywer and signed infront of one.

Transfer of the property only takes place after the final payment is received.

In todays market it maybe your best offer and best chance to sell your house.

[dotpoom]

I don't see a problem.....Take the deposit and next 12 months payments ....THEN give him the chanote....

Exactly, I am trying to sell my house and would be delighted to have the same offer......change the name when the final payment is made....probably wise to have a lawyer draw up a contract.

[scorecard]

I have sold two properties in this way, the important thing is that the buyer needs to be clear that the chanote will not be transferred until the whole amount has been paid.

Really its the buyer who takes all the risk, as a seller you cannot go wrong provided you use due diligence to ensure the buyer has the means to pay, that there is a substantial deposit and that the issue of not getting any title until its all paid is totally clear.

I've also sold this way. I pushed the buyer for a very high deposit and he eventually agreed to pay 45% deposit,

In additional to the items already mentioned by other posters I added the following clauses:

- The buyer understands and agrees that the house and other buildings or structure, fences gates, equipment such as water pumps, electrical wiring, etc., is sold as is / sold in it's current condition.

- The buyer understands and agrees that all payments must be in cash or direct transfer to a bank account nominated by the seller. Any form of cheque / check not accepted.

- For any payment by bank transfer the buyer must give the seller the original copy of the bank transfer document / ATM slip within 24 hours of transfer.

- Any late payments over 7 days incurs 10% interest on the outstanding monthly payment amount until paid.

- Any payment more than 30 days late the contract automatically cancels totally and the seller keeps all payments made so far including the deposit, and the buyer must move out totally within 3 days and the buyer must ensure the house and yard are totally clean and tidy when they move out and are responsible for any unpaid utility etc., bills.

- The agreement document listed all payment due date and a specific amount.

- Buyer cannot make any structural changes or additions to the buildings both inside and outside and cannot paint the property outside or inside until the chanote is transferred to the buyers name or the seller has given written specific permission. If seller gives permission, then buyer is responsible for 100% of all costs.

- Buyer is responsible for all maintenance to the house and any other buildings on the property, fences, gates, garden structures etc., in terms of new maintenance needs which arise after the date the contract is signed.

- Buyer cannot use the house or any other buildings or yard as a business premises or a storage facility until the chanote is transferred to the buyers name, except for a business conducted totally by telephone.

- Buyer can have a total of two small pets on the premises.

- Buyer will ensure that the neighbors are not disturbed in any way at all but especially by noise or by vehicles parked in a way that upsets the neighbors and cannot park any more than 2 vehicles in the yard or in the street and said vehicles cannot be bigger than a pick-up truck.

- The buyer is responsible, after the date of signing the contract for all costs such as: electricity bills, water bills, telephone bills, cable TV bills, Internet bills, village maintenance bills etc.

- Buyer cannot change the name on the bills mentioned above to his/her name until the total payment for the property has been finalized.

- Buyer agrees that it is his/her responsibility to change the name on all such bills to his / her name within 5 working days after the property has been fully paid. All name change etc., costs to be paid by the buyer.

- Seller has the right to instruct the utility providers that he/she is not responsible for such bills after xx/x/xxxx date, and has the right to request such providers to disconnect such utilities if the name is not changed within 5 working days after the chanote has been changed.

- Seller is responsible to maintain up to date payments on house and contents insurance policies but buyer must reimburse half of this cost to the buyer within 30 days and cost pro-ratered in line with final payment date. Failure to pay by the buyer within the 30 days then the contract automatically cancels and the seller retains all payments already made including the original deposit.

- Buyer is responsible for all costs at the Lands Titles office to transfer the chanote.

That's all I can remember.

Note: We added '... cheques / checks... not acceptable' because my Thai son has previously sold a house, buyer agreed to pay total amount in cash but the buyer arrived with 5 cashiers cheques 5 days late. Son took the cheques / checks to his bank manager who scrutinized them carefully then refused to accept any of them. He had his staff telephone to the manager of all 5 issuing banks, then told my son there are serious problems with every one of these five cashiers cheques.

Bank manager then wrote something across all the cheques /checks and told the buyer:

- I will not process any of these cheques / checks because .....

- I will hold these cheques / checks until I have proof that you have paid the seller the total amount within x working days in cash only and in my presence (I think it was 3 working days). After you have paid the full amount in cash I will return these cheques / checks to the issuing banks by registered mail and I will also send copies to the Bank of Thailand.

- If full payment in cash is not paid into the hands of the seller within x working days I will call the police and give them the cheques.

- Bank manager also took smartphone photos of the buyer and his wife, their Thai ID cards and their tabienn baan book. and rego plates on their fairly new BMW sedan.

- Buyer did turn up about 1 hour before the deadline, son immediately indicated they had to go to his bank and son called his bank manager to say he was coming now. Buyer did hand over full cash and every note was checked for any forgeries.

Edited March 1, 2016 by scorecard

[cheeryble]

I have sold two properties in this way, the important thing is that the buyer needs to be clear that the chanote will not be transferred until the whole amount has been paid.

Really its the buyer who takes all the risk, as a seller you cannot go wrong provided you use due diligence to ensure the buyer has the means to pay, that there is a substantial deposit and that the issue of not getting any title until its all paid is totally clear.

I've also sold this way. I pushed the buyer for a very high deposit and he eventually agreed to pay 45% deposit,

In additional to the items already mentioned by other posters I added the following clauses:

- The buyer understands and agrees that the house and other buildings or structure, fences gates, equipment such as water pumps, electrical wiring, etc., is sold as is / sold in it's current condition.

- The buyer understands and agrees that all payments must be in cash or direct transfer to a bank account nominated by the seller. Any form of cheque / check not accepted.

- For any payment by bank transfer the buyer must give the seller the original copy of the bank transfer document / ATM slip within 24 hours of transfer.

- Any late payments over 7 days incurs 10% interest on the outstanding monthly payment amount until paid.

- Any payment more than 30 days late the contract automatically cancels totally and the seller keeps all payments made so far including the deposit, and the buyer must move out totally within 3 days and the buyer must ensure the house and yard are totally clean and tidy when they move out and are responsible for any unpaid utility etc., bills.

- The agreement document listed all payment due date and a specific amount.

- Buyer cannot make any structural changes or additions to the buildings both inside and outside and cannot paint the property outside or inside until the chanote is transferred to the buyers name or the seller has given written specific permission. If seller gives permission, then buyer is responsible for 100% of all costs.

- Buyer is responsible for all maintenance to the house and any other buildings on the property, fences, gates, garden structures etc., in terms of new maintenance needs which arise after the date the contract is signed.

- Buyer cannot use the house or any other buildings or yard as a business premises or a storage facility until the chanote is transferred to the buyers name, except for a business conducted totally by telephone.

- Buyer can have a total of two small pets on the premises.

- Buyer will ensure that the neighbors are not disturbed in any way at all but especially by noise or by vehicles parked in a way that upsets the neighbors and cannot park any more than 2 vehicles in the yard or in the street and said vehicles cannot be bigger than a pick-up truck.

- The buyer is responsible, after the date of signing the contract for all costs such as: electricity bills, water bills, telephone bills, cable TV bills, Internet bills, village maintenance bills etc.

- Buyer cannot change the name on the bills mentioned above to his/her name until the total payment for the property has been finalized.

- Buyer agrees that it is his/her responsibility to change the name on all such bills to his / her name within 5 working days after the property has been fully paid. All name change etc., costs to be paid by the buyer.

- Seller has the right to instruct the utility providers that he/she is not responsible for such bills after xx/x/xxxx date, and has the right to request such providers to disconnect such utilities if the name is not changed within 5 working days after the chanote has been changed.

- Seller is responsible to maintain up to date payments on house and contents insurance policies but buyer must reimburse half of this cost to the buyer within 30 days and cost pro-ratered in line with final payment date. Failure to pay by the buyer within the 30 days then the contract automatically cancels and the seller retains all payments already made including the original deposit.

- Buyer is responsible for all costs at the Lands Titles office to transfer the chanote.

That's all I can remember.

Note: We added '... cheques / checks... not acceptable' because my Thai son has previously sold a house, buyer agreed to pay total amount in cash but the buyer arrived with 5 cashiers cheques 5 days late. Son took the cheques / checks to his bank manager who scrutinized them carefully then refused to accept any of them. He had his staff telephone to the manager of all 5 issuing banks, then told my son there are serious problems with every one of these five cashiers cheques.

Bank manager then wrote something across all the cheques /checks and told the buyer:

- I will not process any of these cheques / checks because .....

- I will hold these cheques / checks until I have proof that you have paid the seller the total amount within x working days in cash only and in my presence (I think it was 3 working days). After you have paid the full amount in cash I will return these cheques / checks to the issuing banks by registered mail and I will also send copies to the Bank of Thailand.

- If full payment in cash is not paid into the hands of the seller within x working days I will call the police and give them the cheques.

- Bank manager also took smartphone photos of the buyer and his wife, their Thai ID cards and their tabienn baan book. and rego plates on their fairly new BMW sedan.

- Buyer did turn up about 1 hour before the deadline, son immediately indicated they had to go to his bank and son called his bank manager to say he was coming now. Buyer did hand over full cash and every note was checked for any forgeries.

What more could one ask for in a bank manager, amazing.

[AlexRRR]

I don't see a problem.....Take the deposit and next 12 months payments ....THEN give him the chanote....

Just like beachproperty said. You will obviously need a contract which would include a clause stating that all payments are due with one year, and if the payments are not made in full and on timr the buyer forfeits all monies previously paid.

Very fair, and it should sharpen the buyers mind somewhat.

'You should also be collecting interest on the moneys outstanding, this makes it a little more sweeter to you, 5% on a million B isnt anything to sneeze at.

[little mary sunshine]

Find another buyer with the money....lots

Less problems....if in five months there is

A fire, buyer has problems with electric,

Storm ruins roof and inside what happens???

[beachproperty]

Find another buyer with the money....lots

Less problems....if in five months there is

A fire, buyer has problems with electric,

Storm ruins roof and inside what happens???

He's got a BUYER....if anything goes wrong and buyer doesn't pay...he keeps the deposit and any payments (forfeited) AND he takes the house back

Buyers not so easy to find in Thailand ....

Edited March 1, 2016 by beachproperty

[little mary sunshine]

Easier said than done....find someone with the cash!

[scorecard]

I have sold two properties in this way, the important thing is that the buyer needs to be clear that the chanote will not be transferred until the whole amount has been paid.

Really its the buyer who takes all the risk, as a seller you cannot go wrong provided you use due diligence to ensure the buyer has the means to pay, that there is a substantial deposit and that the issue of not getting any title until its all paid is totally clear.

I've also sold this way. I pushed the buyer for a very high deposit and he eventually agreed to pay 45% deposit,

In additional to the items already mentioned by other posters I added the following clauses:

- The buyer understands and agrees that the house and other buildings or structure, fences gates, equipment such as water pumps, electrical wiring, etc., is sold as is / sold in it's current condition.

- The buyer understands and agrees that all payments must be in cash or direct transfer to a bank account nominated by the seller. Any form of cheque / check not accepted.

- For any payment by bank transfer the buyer must give the seller the original copy of the bank transfer document / ATM slip within 24 hours of transfer.

- Any late payments over 7 days incurs 10% interest on the outstanding monthly payment amount until paid.

- Any payment more than 30 days late the contract automatically cancels totally and the seller keeps all payments made so far including the deposit, and the buyer must move out totally within 3 days and the buyer must ensure the house and yard are totally clean and tidy when they move out and are responsible for any unpaid utility etc., bills.

- The agreement document listed all payment due date and a specific amount.

- Buyer cannot make any structural changes or additions to the buildings both inside and outside and cannot paint the property outside or inside until the chanote is transferred to the buyers name or the seller has given written specific permission. If seller gives permission, then buyer is responsible for 100% of all costs.

- Buyer is responsible for all maintenance to the house and any other buildings on the property, fences, gates, garden structures etc., in terms of new maintenance needs which arise after the date the contract is signed.

- Buyer cannot use the house or any other buildings or yard as a business premises or a storage facility until the chanote is transferred to the buyers name, except for a business conducted totally by telephone.

- Buyer can have a total of two small pets on the premises.

- Buyer will ensure that the neighbors are not disturbed in any way at all but especially by noise or by vehicles parked in a way that upsets the neighbors and cannot park any more than 2 vehicles in the yard or in the street and said vehicles cannot be bigger than a pick-up truck.

- The buyer is responsible, after the date of signing the contract for all costs such as: electricity bills, water bills, telephone bills, cable TV bills, Internet bills, village maintenance bills etc.

- Buyer cannot change the name on the bills mentioned above to his/her name until the total payment for the property has been finalized.

- Buyer agrees that it is his/her responsibility to change the name on all such bills to his / her name within 5 working days after the property has been fully paid. All name change etc., costs to be paid by the buyer.

- Seller has the right to instruct the utility providers that he/she is not responsible for such bills after xx/x/xxxx date, and has the right to request such providers to disconnect such utilities if the name is not changed within 5 working days after the chanote has been changed.

- Seller is responsible to maintain up to date payments on house and contents insurance policies but buyer must reimburse half of this cost to the buyer within 30 days and cost pro-ratered in line with final payment date. Failure to pay by the buyer within the 30 days then the contract automatically cancels and the seller retains all payments already made including the original deposit.

- Buyer is responsible for all costs at the Lands Titles office to transfer the chanote.

That's all I can remember.

Note: We added '... cheques / checks... not acceptable' because my Thai son has previously sold a house, buyer agreed to pay total amount in cash but the buyer arrived with 5 cashiers cheques 5 days late. Son took the cheques / checks to his bank manager who scrutinized them carefully then refused to accept any of them. He had his staff telephone to the manager of all 5 issuing banks, then told my son there are serious problems with every one of these five cashiers cheques.

Bank manager then wrote something across all the cheques /checks and told the buyer:

- I will not process any of these cheques / checks because .....

- I will hold these cheques / checks until I have proof that you have paid the seller the total amount within x working days in cash only and in my presence (I think it was 3 working days). After you have paid the full amount in cash I will return these cheques / checks to the issuing banks by registered mail and I will also send copies to the Bank of Thailand.

- If full payment in cash is not paid into the hands of the seller within x working days I will call the police and give them the cheques.

- Bank manager also took smartphone photos of the buyer and his wife, their Thai ID cards and their tabienn baan book. and rego plates on their fairly new BMW sedan.

- Buyer did turn up about 1 hour before the deadline, son immediately indicated they had to go to his bank and son called his bank manager to say he was coming now. Buyer did hand over full cash and every note was checked for any forgeries.

What more could one ask for in a bank manager, amazing.

I add a little more, after the buyer and his wife left the bank on the initial visit, the bank manger asked my son to wait while he did a check about the credit rating of the buyer. He found a list of defaults and he was able to quickly establish that the BMW was on a reposession order.

He also told my son that when contacted the 'issuing banks' for the cashiers cheques / checks would not confirm their authenticity but would add no further comment.

Hence the serious reactions and comments from the bank manager, especially his instruction that he had to witness the buyers giving my son hard cash for the total amount.

[beachproperty]

Easier said than done....find someone with the cash!

Easier said than done (to find someone with cash).....you obviously have never "bought or sold" property in Thailand

Easy to buy in Thailand ...HARD to sell.

BUT here he HAS buyer (you must have missed that part ) Willing to buy with a down payment and monthly installments.....I say, Go for it

Edited March 1, 2016 by beachproperty

[chrisandsu]

Easier said than done....find someone with the cash!

Easier said than done (to find someone with cash).....you obviously have never "bought or sold" property in Thailand

Easy to buy in Thailand ...HARD to sell.

BUT here he HAS buyer (you must have missed that part ) Willing to buy with a down payment and monthly installments.....I say, Go for it

Absolutely , he would be a fool not to sell ! I had a guy contact me wanting to buy a house I had . Said he couldn't come for a year so I told him he had to put down 25% for me to not sell( I didn't care I wasn't in a rush ) to another perspective buyer . He done so , when he came he figured out he couldn't own the house ( yes I told him about getting a lawyer to create a business) he decided he didn't want the house anymore ... Didn't even ask for the deposit back as I had been more then fair with him . So I got 25% of the value of the house for nothing . I was very happy with that

[fekman]

Is the buyer a non-Thai? If he's Thai, run, don't walk, as borrowing from, or loaning money to a Thai as a foreigner is illegal. If he defaults, a judge may (will) rule in his favor and possibly award him the title.

[beachproperty]

Is the buyer a non-Thai? If he's Thai, run, don't walk, as borrowing from, or loaning money to a Thai as a foreigner is illegal. If he defaults, a judge may (will) rule in his favor and possibly award him the title.

Well the big "if" here is .....does his "wife" own the property? if so, it would obviously be a "Thai to Thai" transaction as farangs can't "own" property.

So the problem you present ..... doesn't exist.

[scorecard]

Is the buyer a non-Thai? If he's Thai, run, don't walk, as borrowing from, or loaning money to a Thai as a foreigner is illegal. If he defaults, a judge may (will) rule in his favor and possibly award him the title.

Rubbish.

[mango66]

I don't see a problem.....Take the deposit and next 12 months payments ....THEN give him the chanote....

Just like beachproperty said. You will obviously need a contract which would include a clause stating that all payments are due with one year, and if the payments are not made in full and on timr the buyer forfeits all monies previously paid.

Very fair, and it should sharpen the buyers mind somewhat.

And the buyer will not occupay the house before full payment and transfer !!

Have bad experiances with thai !!

12 months will never be 12 months !!

100 things will happen meantime !!

that he will delay installments;

You will spend money meantime and not able pay back deposit,

you loose time on money and house !!

Don't do it !

Just if it's an trustworth farang !!

I did simlar - after delays - canceled -

and i had to get an expensive loan to finance some other deal !

So double lost !

Never again !!

[mango66]

Also draw up a contract stating that the house will be repossessed if he defaults on a payment.

Sent from my SC-01D using Tapatalk

good luck to repossess if there would be 3 families with 10 kids living in !!!!

You my guess on which side the RTP would be !!

And the judge !!

[beachproperty]

I don't see a problem.....Take the deposit and next 12 months payments ....THEN give him the chanote....

Just like beachproperty said. You will obviously need a contract which would include a clause stating that all payments are due with one year, and if the payments are not made in full and on timr the buyer forfeits all monies previously paid.

Very fair, and it should sharpen the buyers mind somewhat.

And the buyer will not occupay the house before full payment and transfer !!

Have bad experiances with thai !!

12 months will never be 12 months !!

100 things will happen meantime !!

that he will delay installments;

You will spend money meantime and not able pay back deposit,

you loose time on money and house !!

Don't do it !

Just if it's an trustworth farang !!

I did simlar - after delays - canceled -

and i had to get an expensive loan to finance some other deal !

So double lost !

Never again !!

Sorry to hear you had problems selling your house.....you obviously didn't ask on Thai Visa how to "cover your Ass" ....otherwise you would have a contract with clauses such as "Scorecard"

and other astute posters have pointed out.

Edited March 1, 2016 by beachproperty

[beachproperty]

Also draw up a contract stating that the house will be repossessed if he defaults on a payment.

Sent from my SC-01D using Tapatalk

good luck to repossess if there would be 3 families with 10 kids living in !!!!

You my guess on which side the RTP would be !!

And the judge !!

RTP is on the side of "who pays them the eviction fees".....so sad to say....the 3 families and 10 kids are ...OUT!

[scorecard]

I don't see a problem.....Take the deposit and next 12 months payments ....THEN give him the chanote....

Just like beachproperty said. You will obviously need a contract which would include a clause stating that all payments are due with one year, and if the payments are not made in full and on timr the buyer forfeits all monies previously paid.

Very fair, and it should sharpen the buyers mind somewhat.

And the buyer will not occupay the house before full payment and transfer !!

Have bad experiances with thai !!

12 months will never be 12 months !!

100 things will happen meantime !!

that he will delay installments;

You will spend money meantime and not able pay back deposit,

you loose time on money and house !!

Don't do it !

Just if it's an trustworth farang !!

I did simlar - after delays - canceled -

and i had to get an expensive loan to finance some other deal !

So double lost !

Never again !!

Sorry to hear you had problems selling your house.....you obviously didn't ask on Thai Visa how to "cover your Ass" ....otherwise you would have a contract with clauses such as "Scorecard"

and other astute posters have pointed out.

Scorecard forgot one clause in the contract:

- 'Only people allowed to live in the house until chanote transferred is the buyer (husband and wife) in this case and their one small child. Other people are allowed to sleep at the house, maximum of 2 more, for one night only within any 7 days period.'

Also we paid a lawyer to check that the document was legal and binding and wasn't ambiguous etc, and it was stamped at the Lands Title office in the presence of my family, the buyer and his wife and a further witness invited by the buyer and a senior from the LTO, all present also endorsed every page.

Edited March 1, 2016 by scorecard