What Payment Schedule can I Expect when buying a "Re-sale" Unit?
Payment Schedules for buying "Re-sale" Property
Phuket is still predominantly a cash market. Most owners of "re-sale" units are looking for full payment within approximately 90 days. However, terms with a payment schedule can be negotiated in an "Offer" to the seller and formally written into the contract between buyer and seller. And a "re-sale" unit in Phuket refers to a completed property purchased on the secondary market.
When you purchase a property under construction in Phuket you will receive a payment schedule similar to the one below. The developer's payment plan will correspond to the construction progress and as a stage of the property is completed, a payment is made by the buyer until the property is completed and transferred at the land office.
It is typical for a seller to ask for a 2% reservation payment (booking fee) once an offer is accepted and agreed on by both parties. The booking fee is usually followed by a 30% deposit at the time of contract signing which is usually in 30 days. This gives the buyer time to conduct due diligence on the property and both parties have enough time to go over the contract with legal counsel. The balance of the purchase price is due at closing and transfer of title at the land office. This can be anywhere from 30 days to 90 days from booking. It is also common for the balance to be paid in full at contract signing and the transfer it done simultaneously.
A reservation agreement (booking agreement) is just a one or two-page document. It is designed to signify that the offer and terms have been accepted and the property is reserved (taken off the market) while the contract is being drafted and due diligence conducted. The reservation payment (booking fee) is made at this time and goes toward the purchase price.
The contract is usually signed within 30 days of the reservation agreement. This gives the buyer enough time to perform due diligence on the property and review the contract with a property law firm. The deposit is due at contract signing and can be put in escrow or paid directly to the seller.
It is common for new buyers to have many questions. Many are explained as frequently asked questions (FAQ).
The balance of the purchase price is paid to the seller at the time of transfer at the land office in Phuket. This can be with a cashiers check or through an escrow account or in cash.
The term payment schedule usually refers to "Off-Plan" properties and properties under construction. They are generally paid over the course of construction according to a pre-defined payment schedule and the ongoing construction progress of the property. Payment schedules can differ from developer to developer and from project to project.
5 Year Payment Plan
There are some developers offering financing terms of up to 5 years. These longer terms usually come with some interest. When buying re-sale property the buyer can sometimes ask for terms from the seller and is on a case by case basis.
To learn more about buying re-sale property in Phuket Thailand please call +66 93 606 0906.