Chanot (Nor Sor 4): This type of title deed, registered at the Land Department in the province in which the land is located, grants the holder of the documents full rights over the land. It is therefore the strongest type of title deed. The title deed contains a legal description of the land boundary markers that are carefully ascertained and referenced by satellite images.
Nor Sor 3 Gor: This land title designates ownership of land with fairly certain boundaries, however it is not yet a full land title (chanot). A final official measuring is required by the land department along with the placing of official markers. This type of land title may be sold, transferred, or mortgaged. If the owner of the land files a request with the Land Department, surveyors from the land department will measure the land, the title may be changed to Chanot.
Nor Sor 3: Although ownership of the land covered in this title is relatively ascertained, the Land Department has never measured or recognized the boundaries. Therefore boundary markers are normally placed by property owners rather than government authorities. Accordingly, the main risk is whether the boundaries and size of the land is accurate.
Possessory Right: This is normally an inherited land right proven by tax payments at the local administrative office. It is one of the weakest types of land rights.
Sor Por Kor 4-01: This is an agricultural title deed, usually found in rural areas. Government land is transferred for agricultural purposes to needy families. Residence is allowed on a portion of the land. It is difficult for a non-Thai to obtain an interest in this type of land deed.
Land mortgages in Thailand must be made in writing and registered with the Land Department of Thailand. Mortgages do not include the buildings built on the land after the mortgage date unless they were agreed upon before the mortgage documents were signed. In addition, buildings and other immovable structures may be mortgaged separately and should be registered with the Land Department or local Amphur (province). The fee for registering a mortgage is 1% of the amount declared in the mortgage agreement.
The transferring fee, withholding tax and the stamp duty or Specific Business Tax (SBT) must all be paid by either the buyer or seller when a property is purchased. Although Sale and Purchase agreements differ, the buyer is typically responsible for the transfer fee, while the seller pays the stamp duty or specific business tax and the withholding tax.
Transferring Fee: 2% of the registered value of the property; paid at the Land Office on the day of transfer of ownership
Stamp duty: .5% of the appraised value of the property or the purchasing price, whichever is higher
Specific Business Tax (SBT): 3.3% of the appraised or actual price of the property, whichever is higher; Imposed only if the property is transferred less than five years after its purchase (If the SBT is levied, stamp duty will not have to be paid.)
If you intend to hire a local law firm, be sure that the local law firm you contact does not have a pre-existing working relationship with the seller and/or Land Department officials. Such law firms may be biased in their assessment. In most Western countries, it would be deemed a serious conflict of interest and breach of ethics for the same company to act as a real estate broker and an attorney for the same client. However, in Thailand, certain companies marketing to non-Thais do exactly that. Alternatively, Bangkok-based law firms can be retained to travel to the provinces to execute the land deal. You may feel more confident that the Bangkok-based law firm will operate independently and 100% in your interests.
Official Website – http://www.ldd.go.th/indexEng50.htm
ThaiVest is a free online resource and community for anybody living or wishing to live in Thailand aiming at being financially independent.
ThaiVest covers the following topics:
Property in Thailand
Start-up & Company formation
Living in Thailand & Thai Culture
Visa & Residency