Thailand – Property Title Risk Mitigation
 
Thailand operates what approximates to a deeds registration system maintained by land offices throughout the country. There is no state guarantee of title. Fraudulent transfers of land (including any fraud committed by Government officials in issuing title) are void and will usually result in the property being returned to the rightful owner.
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The highest standard for land ownership is a Chanote, which includes all the legal rights to that land. The deed is evidence of ownership and proof that the land has clearly defined boundaries. These tend to be found in only the most developed parts of Thailand and are registered at the Land Office in the area in which the land is located.
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Most titles in rural Thailand are lesser possessory title deeds known as Nor Sor 3 Gor and Nor Sor Gor. These do not have official markers designated on the land by the Land Department and boundaries are recorded in relation to the neighbouring plots. Errors in length of boundary or area are not unusual. Special care needs to be taken where dealing with rural, forest & beach reserve land (where most resort type developments are located) and with Phuket in particular.
 
Title Insurance
 
Title insurance from First American provides a resilient risk mitigation tool for investors, financiers and vendors. Coverage includes the beneficial ownership of the property and the validity of insured mortgages. The premium is a one-off up-front payment on purchase and the policy lasts as long as the ownership of the property or life of the loan.
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Vendors of resort estates can use a Commitment to Insure (effectively a promise by the title insurance company to insure any buyer at a specific premium upon purchase) to allay buyer's fears regarding title issues and improve marketability.
 

 
For more information on how title insurance can protect you and your clients, please visit our website www.firstam.com.hk or contact us.