Due Diligence serves to confirm all of the material facts of a sales. In regards to the sale of a property, this involves going beyond reviewing the terms of the contact. It is important to physically inspect the property, review government permits, complete a title check, and review liens on the property. In addition, it is important to do a background check on the seller or developer. In Thailand, due diligence is a required expense because of the possibility of high propensity of land scams.
It is important to search and review the legal documents relating to the land or property at the government land office. There are a variety of different land titles in Thailand with different property rights. It is important to inspect the land documents to check on the title qualities and whether the property is beholden to lien.
There should be a physical inspection of the property through an independent surveyor. This is ascertain if the land is connected to a public road and if the boundaries of the land are clear and whether the title deed accurately reflects the actual boundaries. There needs to be proper access to the property from a road. It is also important to determine the local zoning ordinances and what will be built in nearby land parcels.
Inspection of Building Permits
If the property is a new development or even an established one, it is important to review the government filings to ensure that the property has been issued approved land permits. It is important to review the type of development and ensure that there are no restrictions in the area. There needs to be an Environmental Examination of the property, review that it has passed building codes, and whether parking will be available to the property owner. It is also important to ensure that the property is not encroaching on environmentally protected lands which makes development illegal.
Seller Background Review
There are many scam artists in Thailand. It is important to review the credentials of the seller or property developer. The seller or developer must be conclusively identified, their financial background checked, and whether they have been part of court proceedings. Litigation can damage the property rights of the owner. If the seller is the developer, it is important to review their previous developments and the satisfaction the property buyers in those developments.
Due Diligence can raise concerns which will protect the buyer and break up the sale transaction. Or the concerns may be minor which will allow the parties to amend the agreement.
A Thai property lawyer can prepare a due diligence report for your purchase. The due diligence report will include your title search report, pictures of the land, and translations of construction permits or other documents related to the property.