Due Diligence: what you pay a lawyer for (continued)

In the last article, we talked about what Due Diligence is in a case of purchase secondary house or land. What to do if you conclude an agreement with the developer at the construction stage, the apartment exists only in the construction plans, designs and advertising brochures, how to check the reliability of the transaction?

Of course, if there is still no chanot for an apartment, then it is unrealistic to check it. But you can and should check the chanot of the land on which the developer plans to build the building.

- Does the property belong to the developer.

- Is the land free of encumbrances or is it secured at the time of conclusion of the contract.

It is also worth checking the availability of permits at the time of conclusion of the contract:

- EIA - approval of the project by the Environmental Investigation Agency.

- Building permit.

When concluding a contract at the initial construction stage, when the developer has nothing to show, except for the land, it is important to obtain the maximum information about the developer:

- The statutory documents of the developer - you need to get an update copy of the documents in the development business department (dbd). So you will receive information about the shareholders and directors of the developer, the authorized capital and the date of registration of the company.

- Balance sheets of the developer for previous years of work - get from the tax office. It will give an idea of the actual investments made by the shareholders of the company, the value of the land acquired by the developer for the construction of the condominium.

If the condominium in which you buy an apartment is not the first project of the developer, you should check other projects

- if there any violations of the construction terms

- if there other problems (commissioning, changes of shareholders during construction)?

- Check the quality of construction of other projects.

If everything is in order, you are convinced that you can work with the developer, we proceed to check the draft contract of sale:

- The contract must comply with the draft purchase and sale agreement for an apartment in a condominium approved by the Thai Ministry of Internal Affairs.

- The contract must be drawn up and signed in Thai and English (Russian) languages.

- Copies of the developer’s documents, director’s passports, title deed for the land must be attached to the contract. All promotional materials are also attached to the contract.

As you can see, the work of a lawyer before you can safely sign a contract is quite significant. Do not refuse the services of professionals and rely on the words of real estate agents and managers of the developer. The primary market is very attractive in price, but carries additional risks. You can minimize them with Due Diligence.

For all questions of checking documents and supporting transactions of real estate sale and purchase in Thailand, please contact us: + 6687-348-57-03 (WhatsApp, Viber)

Author: Aleksandra Agapitova

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