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Usufruct in Thailand

Usufruct in ThailandMany expats who live in Thailand and are married to a Thai national decide not to have a prenuptial agreement as the only asset they have is a house in Thailand. The rural areas of Thailand have many expats who have decided to retire in Thailand. Since you cannot own a house in Thailand in your own name they place the house in the name of their wife most times.

Before you wife can buy the house she would need to confirm as well as you that the house belongs to your Thai wife and that you have no claim to the property. Having a house where you have no rights can be a problem for many. In the event of a divorce holding onto the house would also present a problem. Most expats rent property but some do buy. What they opt for in these circumstances is a usufruct.

The usufruct in Thailand is governed by Sections 1417 to 1428 of the Commercial and Civil Code of Thailand. The usufruct is a right granted by the owner of the house (your wife) in favour of a usufructuary (you) whereby you have the right to possess, use and enjoy the benefits of an immovable property.

Usufruct in Thailand

This gets registered against the property and in the event of a divorce you still hold the usufruct over the property. The usufruct gives you the right to live in the house until the usufruct expires. Most times this is a good way to negotiate a settlement during a divorce. As an example since the house is going to be sold you can demand payment after the sale for the usufruct being removed in return for your share of the property sale. In Thailand you are not going to get the full price returned to you however you will not lose everything as the usufruct will give you bargaining power.

The maximum period you can have a usufruct for is 30 years in Thailand or the life time of the usufruct holder. This is more than enough time for anyone. If you decide to rent out the property the rental still becomes due to you as a usufruct holder over the property. You may poses the property but since you are not the owner you may not destroy the property or sell the property. Note that the usufruct needs to be registered against the title deed of the property and any lease you have over 3 years must also be registered at the Land Office in Thailand.

Note that if you are divorced and you have a usufruct over the house, you wife can still sell the property and you will still retain the right to live there. Nobody buys a property with a usufruct over it as the property loses its value.

If you do not want a prenuptial agreement then you might ask an attorney in Thailand about the use of a usufruct for the property you have in Thailand to protect you during a divorce.