Legal checks and due diligence

Hula Property
Legal checks and due diligence

Legal checks and due diligence

Engaging the professional services of local lawyers is a common and prudent step for property buyers who seek to perform due diligence checks on the property title and/or developer, ensuring the legitimacy of their right to sell.

Typical legal services encompass various crucial aspects:

  1. Initial Title Investigation: Conducting a comprehensive examination of the title to ensure the absence of outstanding charges and encumbrances.

  2. Document Preparation and Review: Preparing or reviewing reservation agreements, sales and purchase contracts, ensuring clarity and fairness.

  3. Bank Account Assistance: Assisting buyers in the process of opening a Thai bank account, facilitating financial transactions.

  4. Condominium Act Compliance: Providing advice and assistance to ensure compliance with the condominium act, if applicable to the property.

  5. FET Acquisition: Assisting in obtaining the Foreign Exchange Transaction Form (FET) from the buyer's bank, a prerequisite at the land office for registering ownership transfer.

  6. Tax and Fee Calculation: Calculating applicable taxes, duties, and transfer fees, ensuring financial transparency.

  7. Representation at Land Office: Representing the buyer at the Land Office for the completion of the title transfer process.

  8. Power of Attorney Provision: Furnishing any necessary Power of Attorney required for the transaction.

Beyond these standard legal services, due diligence can extend to more intricate investigations, including:

  • Bankruptcy Search (on Developer): Examining the financial stability of the developer.

  • Land Zoning and Building Permit Check: Investigating land zoning regulations and ensuring proper building permits.

  • Condominium Juristic Person Examination: Scrutinizing the Condominium Juristic Person, whether it be a company or individual owners.

  • Condominium Rules Verification: Vetting the rules governing the condominium to ensure adherence and understanding.

  • Condominium Accounts Inspection: Examining the financial accounts of the condominium.

  • Future Expenditure Inquiry: Inquiring about proposed future expenditures concerning the property.

  • Insurance Policy Verification: Confirming the details and validity of the insurance policy associated with the property.

  • Site Inspection (if required): Physically inspecting the site if deemed necessary.

  • IEE and IEA Filling Process and Approval Review (where applicable): Reviewing the filling process and approval for Initial Environmental Examination (IEE) and Environmental Impact Assessment (IEA), where applicable.

  • Construction/Developer Plans Alignment Check: Verifying if the construction and developer plans align with Environmental Impact Assessment (EIA) approval, where applicable.

  • Background Check for Legal Proceedings or Mortgages: Conducting a background check for any ongoing legal proceedings or mortgages related to the land, property, or the actual developer.

Importantly, property buyers are not mandated to be physically present in Thailand for the legal transfer of property upon completion. A designated power of attorney empowers a lawyer or representative to act on behalf of the buyer. Funds designated for property purchase can be entrusted to the legal representative, ensuring meticulous handling of all legal documentation, FET forms, invoices, receipts, payments to the seller, and the secure return of title deeds and ownership documents to the buyer.

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