Leasing Land - How's it done?

[jazzman]

The Brits (and maybe the Americans) have an expression for a thread like this - now in its third page, it's called "flogging a dead horse" ('flogging' as in 'whipping', not 'selling'.

Thomas was quite clear about his situation. His marriage is not registered in LOS so there is no need for him to mention it at the land office - saying too much can sometimes open a can of worms.

The usufruct is so straightforward, as the previous two pages clearly describe, that Thomas need have no fears whatsoever.

Und damit basta

[Nawty]

Apparently with a usufruct, if you are married and sign this up, then the wife/landowner has the right to cnacel the usufruct at any time she wished.

Something to do with not being a 'real' agreement between 2 individual parties.

If it is signed and you are not married, or before marriage it is fine.

Might see loys of divorces for a day or 2 and then re marry.

[jazzman]

Apparently with a usufruct, if you are married and sign this up, then the wife/landowner has the right to cnacel the usufruct at any time she wished.

- Source?

If that is true, then the superficies would be the way to go.

[Nawty]

Read it on ThaiVisa.....but one of the posters was a one of the lawyers that post over there regularly.

Sounds like an absurd ability, but TIT and many strange things happen. Dont forget was not that long ago that thais married to foreigners could not own land, thai females that was.

[jazzman]

This is classical of the panic-making that will have thousands running to him for company set-ups and lease contracts. Thai visa is a notorious destination for trolls and sneak advertisers (we've had some of them here on CTH) but it is such a big site that its owner and moderators can be forgiven for occasionally letting things slip through, although they are usually pretty quick to boot people off who make a nuisance of themselves.

All lawyers know that usufruct is so cheap and easy that the help of a law office is in no way required, and that's why they keep quiet about its existence, or discourage it under some pretext if the client has already heard about it - instances have already been posted on this web board of people being asked to pay 16,000 baht (yes - this is not a typo) to do a usufruct that costs only a 75 baht Land Office fee!.

If you got this news 2 days ago, it may have been an April Fool trick.

[Traveler]

How to delete a post ? I dunno.
Please delete

[Traveler]

The usufruct is so straightforward, as the previous two pages clearly describe, that Thomas need have no fears whatsoever.

Jazzman,

I agree, an usufruct may prevent Thomas' wife to sell the land without his approval, which is exactly what he wants.

But what about the registration of a personal loan/mortgage at the land office ?
Nobody would buy some land with this burden as well and while the value of the usufruct (or deleting it at the land office) is still negotiable, the value of the debt/loan/mortgage is documented.

The registration fee is only 1% of the loan as far as I know. Sure, it's more expensive than the usufruct, but it offers more possibilities as well.

An usufruct is almost worthless if your wife's family makes living there like living in hell, but a loan can be forced to be paid back (hopefully )


I have attached the "Letter of Confirmation" that I have promised some time ago.
You will need this form if your Thai wife is going to buy some land.

[Traveler]

Apparently with a usufruct, if you are married and sign this up, then the wife/landowner has the right to cnacel the usufruct at any time she wished.

Something to do with not being a 'real' agreement between 2 individual parties.

If it is signed and you are not married, or before marriage it is fine.

Might see loys of divorces for a day or 2 and then re marry.

Nawty,

sorry to object, but you are wrong in this regard.

It is correct that some decisions or actions of your wife may also affect you - like buying a car and if she isn't able to pay you got to pay for it - because a married couple is legally an "unit" in many legal areas, but your wife can't withdraw personal rights from you - which are bound to your person only. An usufruct is such a right.

Furthermore, a married couple can indeed make valid contracts between each other, a prenup for example.
Some of those contracts need a certain form or must be notarially certified, that's it.

[Nawty]

Nice to know, but as with anything when you hear contradictions, you need to confirm them for yourself before going ahead with it.

I was commenting on what a 'lawyer' elsewhere had said, so as they say in that classic "I know nutting...nutting"

[Traveler]

Nawty,

it's not just hearsay, I have made a notarially certified prenup with my Thai wife AFTER we had married.

A huge part of the Thai Law was derived from German Law (remember, even the national anthem was composed by a German) and a very close Thai friend of mine I am doing business with for over 12yrs now had studied Thai Law.

Again, married partners can make valid contracts between each other, these agreements/contracts only need a certain form.
And no partner can revoke individual rights, which are bound to the other partner.

If your partner would be able to revoke any such rights, he/she would also be able to change your testament/will, reject a heirship in your name, return your driver license, close your bank accounts and so on. But in reality your partner won't even get a new passbook if the old one is full - even if it is a joined account. Your signature is mandatory.

If your assumption would be correct, .strange situations could arise. What if your wife may reject YOUR heirship your parents imeant for you, which you want to accept. Would her decision override yours or not, or would it be equal weight ?

BTW, an usufruct isn't just an agreement/contract between two parties (beneficiary and owner of the land), it's rather a documented right bound to a certain entity. This right stays on, even if the owner of the land may change. That's the whole idea behind it, otherwise an usufruct would be worthless and useless, being married or not.

Your partner's decisions and actions may affect you - like his/her debt may be paid back by you - but your partner can't decide in your name.

There can be in fact a situation, where a contrtact between married partners may not be invalid, but worthless. If your wife/husband lends/borrows some money to/from you, because married partners usually have to pay the debt of their spouse (see above).

[Nawty]

Thanks for the info...you will see in my post that I basically agree with what you say, I mention that it seems odd for it to be true....but tit as they say.

Your last sentance, this means any mortgage or loan agreements that guys have with their wives etc for the house/land is worthless ??

[Traveler]

Your last sentance, this means any mortgage or loan agreements that guys have with their wives etc for the house/land is worthless ??

Yes and No, it depends on the circumstances.

Usually any personal loan agreement between married partners is more or less wortless, simply because most couples don't have a seperation of property. They are also forced by law to support each other and therefore have to pay each others debt if necessary.

A mortgage is a totally different thing, as it's usually registered at the land office and entered in the title deed. It's a personal right, bound to your person and the piece of land given as security for the mortgage. This right will stay intact even if the land is transferred. The debt and the obligation to pay it back to you is passed on to a new owner - in case anybody is willing to buy some land with a mortgfage on it, or if it is transferred for any other reason.

You may not be able to enforce the payback of the mortgage from your wife - because if she doesn't have the funds you got to pay it, or in other words, you would have to pay back your own mortgage to yourself. But since most people won't buy any land with a mortgage, you can prevent the selling of the land this way.

As soon as the land would be sold / transferred to another person - other than your wife or underaged children - you would be able to enforce the payback of the mortgage to at least save your invested money. The fee to register it is 1% of the mortgage as far as I know. Don't try to be cheap ! Don't forget that the value of the land may rise over the time and that you are going to build a house on it. Therefore the mortgage should cover the estimated future value of the land plus the house if you want to play it safe.

I still believe that a mortgage is better than an usufruct, simply because the mortgage has a monetary value, while the usufruct has none. A combination of both is best of course.

[dozer]

A mortgage is a totally different thing, as it's usually registered at the land office and entered in the title deed.

You may not be able to enforce the payback of the mortgage from your wife

Here in the Pattaya/Banglamung land office they don't normally allow mortgages to be registered between husband and wife. They would be clued into the marital status by a change in the last name of the woman (ie. to a non-Thai name) and the designation of married on the ID card. There is no problem for those living together or those (such as Thomas) who registered a marriage outside of Thailand.

The only other note about a mortgage is it doesn't entitle the mortgage holder the right to enter the property, you can combine a mortgage with a 30 year lease (both recorded on the deed) for more protection.

[Traveler]

Here in the Pattaya/Banglamung land office they don't normally allow mortgages to be registered between husband and wife.

This may be due to the fact, that most couples don't have a seperation of property. Without it, a married couple forms a financial unit and as such both partners can't effectively lend/borrow any money to/from each other.

As soon as you can prove - with a prenup e.g. - that you have seperated your property, you will be able to register a mortgage.

I do have some land in the very same area you mentioned with a registered mortgage on it. But in my case the constellation is a bit different. The land is owned by a company, with my wife as the majority shareholder. I do control the company as the general manager and also do have the necessary paperwork to get rid of any troublemaker if necessary.

You are right, a mortgage doesn't grant you any rights to use or even enter the property, that's why I said it would be best to combine it with a usufruct. Nevertheless,, neither the usufruct nor a 30yr lease will be of great help if your wife and/or her family is making living there like living in hell. This is especially true in the rural areas.

An usufruct and a lease may (theoretically) enable you to kick your wife and/or her family out of the house after seperation/divorce, but it's often hard, if not impossible to keep them from illegally entering the property to damage support lines (water/electricity/tv cable etc.) or making life hard for you any other way.

A 30yr lease also has the great disadvantage that it runs out sooner or later and according to Thai Law it can only be prolonged once. Many property agents and lawyers will tell you that a lease can be prolonged twice resulting in a 3 x 30yr lease but that's not correct). The landlord also has to accept the prolongation of the lease and it also must be registered at the land office. If he/she refuses to prolong your lease then you got to move and will lose the house you may had built on that empty piece of land. Even though some guys try to convince you that you can agree on a prolongation beforehand, it isn't true. The landlord isn't bound to any such contract. He may have a moral obligation but no legal one and it will be very hard to suceed in front of a court.

Therefore a mortgage is the way to go IMHO. You will be able to save your invested money in case you got to leave. It can also be inherited to your relatives and children which will most likely have not much interest in the usufruct or lease. If a mortgage isn't possible due to the lack of seperation of property, an usufruct clearly caps the lease, because of the above described disadvantages of the lease.

[Ten thumbs]

Hi! first of all i want to thanks for a great site!
this is my first post here,but sure not the last...
its now one year ago since i find a nice land outside trat.
the land owner was a young and cute girl,i paid her some money and she give me a lease for 30 years+30+30.
the same day we were at Ampour District office i registated a superficis too.the contract i use was in English and Thai.
in the office we have to sign 2 contract in thai, one for the lease and one for the superficies.the contract was so attach to the chanote deed.on the back of the chanote is there also written 1 place that i lease the land from her for 30 years,and a another place that i own everything uppon land as house,pool.garage etc for 30 years.
we went so to a local office and get a building permit valid for one year,this was written in her name.
then we get a temporarily electric meter this was too in her name.
now is the house almost ready, so i want them to come and set upp a eletric meter in my name and i need som bok or paper that say i own and live in the house,i think i need this also to get me ubc,internett,buy a car etc.does anybody now were i can get this book/paper?
Ten Thumbs