In the context of foreclosure, a creditor can use various methods to enforce his entitlements. When deciding on one of the foreclosure measures, the specifics of the case should be carefully considered to be most effective.
Please see below an overview of the available methods of foreclosure:
1. Principles of foreclosure
The basic conditions for enforcement are the same for almost all cases: You must have an enforceable court order. The debtor must have been served with a copy, and the application to appoint a bailiff should be filed to the court once the debtor does not comply with the judgment within the period prescribed by the court (normally 30 days).
If a third-party debtor is involved in the proceedings, the bailiff will be put in charge of the delivery of the attachment order. A third-party debtor is, for example, the employer to whom the creditor turns to seize the debtor’s wages.
Other foreclosure tasks are strictly and specifically assigned by the law: Attachments fall under the jurisdiction of the bailiff, estimates are made by an expert.
It is advisable not to wait too long to initiate an enforcement procedure, especially if several creditors apply for the seizure. In such a case, the order of the applications decides who receives the proportion of the garnishment proceeds in what amount.
2. Foreclosure measures at a glance
a. Account garnishment
The seizure of the account is a foreclosure measure involving the debtor’s bank. The creditor applies to the bailiff for a seizure and transfer order and sends it to the financial institution. Confiscated may be current and future bank balances of the debtor. The creditor shall file an application to receive the corresponding amount to the bailiff after a waiting period of four weeks.
For the debtor, these measures have far-reaching consequences. The bank withdraws his debit card, he can no longer carry out cash withdrawals. In addition, the function of standing orders and direct debits set up on the account ends. The debtor thus makes no payments for running costs such as rent or electricity.
b. Seizure of property (public auction)
If the debtor has properties (both movable and immovable property), enforcement of the properties may qualify as an appropriate method of enforcement. Relevant for immovable properties are land, buildings or condominium units. The prerequisite for this is that the debtor is registered as the owner (or heir of the owner).
For the public auction date, the court that is in charge of the enforcement sets a market value for the property. At auction, minimum bid limits must be met to ensure that the property is not auctioned well below value. With the award, the person who buys the property immediately becomes the new owner.
c. Attachment of claims or entitlements of the debtor, or other rights
Other options for attachment may involve the claims or entitlements of the debtor. These may be options on any claim that the debtor has, such as a claim on a rent, dividend, securities, or a car financed by a loan. Also, annuity or life insurance are claims which may be attachable.
Relevant may also be the attachment of intellectual property rights and other rights.
d. Wage garnishment
In the case of wage foreclosure, the creditor applies directly to the debtor’s source of income: with the employer. As soon as he receives the seizure order, the creditor obtains a seizure lien on the wage claim of the employee. The employer must pay the attachable part of the salary directly to the creditor. For social reasons, the seizure of wages or salaries is very restricted, always leaving the debtor with a living wage minimum. In Thailand, the monthly wage amount of less than 20,000 THB is not seizable.
The seizure of property is, according to the Code of Civil Procedure, the standard form of foreclosure. Usually, the procedure is such that the bailiff visits the debtor at home and seizes movable property there.
In principle, he has the entire possession of the debtor at his disposal. However, certain items are exempt from the seizure: those that the person concerned needs for an adequate lifestyle. These include the clothes, the bed, the computer and the car. The things seized by the bailiff are kept in official custody and later auctioned off. The proceeds from this auction go to the creditor.
f. Asset information
In Thailand, it is the creditor’s burden to investigate the assets of the debtor and file a separate application in order to seize each asset. There is no possibility to file for asset information.
If the process results in a formal enforcement procedure, the debtor is threatened with a negative Credit Bureau entry, which diminishes his creditworthiness to possible business partners.