September 26 2003

Mistaken for the Bangkok Bank

Beating the scroungers: A survival guide

A victim of groin lending

As "wealthy" foreigners, we are often asked for loans - as if we were the Bangkok Bank. Needless to say, kindly farangs rarely get their money back.

Dealing with the financial needs of a Thai partner's family is a common problem. Regardless of what they might say, any loan would be regarded as a gift. It wouldn't win their love or respect either. Do you love your bank manager?

Polite attempts to seek repayment would be brushed off. More serious attempts could lead to conflict and might even put your life in danger. Your girl would have to side with her family. If she was a prostitute (or even if she wasn't), this could be the sting she has been planning all along.

Generosity is a virtue but it shouldn't be confused with lending. In a family situation, paying a reasonable dowry or giving a monthly allowance might be more appropriate. If money was the reason she married you, once it is spent or lent you are of no further use to her. Keep control of the purse strings.

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In general, requests for loans should be rejected immediately. You don't have to get angry or make excuses. Just refuse to discuss the matter further. Don't be vague or this will be interpreted as a deferred "yes". They will choose their moment carefully so be ready.

Don't be a sucker. Friends who freeze you out when you turn them down were never friends. However, situations may arise where you want to be generous to an attractive woman for rather predictable reasons. Gifts are fine but lending is a different matter altogether. Bankers call this groin lending and are instructed to avoid it.

If you must lend, write out a loan agreement and include a repayment schedule with penalties. The loan-shark interest rate here is typically 10% per month, paid monthly. Charging interest could make the deal worth your while or, better still, scupper the whole thing.

Secure the loan. If this seems too business-like, just bear in mind that you will probably clash with the recipient later. Cover your losses now. Subjecting yourself to future sleepless nights fuelled by angry fantasies about sending the boys round is not healthy.

For large sums (it's your funeral mate), use a good lawyer and bear in mind that repossessing a house is very difficult here. Also, do you really want to own a shack in Buriram? Who would you sell it to? Repossessing a pick-up truck might also prove difficult. Many Thais own guns and don't hesitate to shoot those who threaten their property. The ownership documents may count for little - particularly when the local police chief is a cousin.

For small sums, hold onto their gold, cellphone or motorbike etc. Have them sign a loan agreement and demand purchase receipts or transfer documents. Reject property that you suspect is stolen or borrowed. Only accept what you want or can sell because you will probably be the owner soon. Don't even think about unsecured lending unless you want to play Father Christmas.

This approach applies equally to lending to westerners. However, if you want to shake off some pain-in-the-arse farang, just lend him a few thousand baht and enjoy his subsequent disappearance.

[Posted to Farang Life by David]

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Readers' comments

the night ranger says:

Very true.. The intent to repay you just isn't there. "Neither a borrower nor lender be," eh?

January 12, 2007 3:04 AM

Mr Squirty says:

Nice one Dave! not only a cracking good laugh, but a wealth of sound advice,I wish you would provide printer friendly versions of these articles, as some of them are well worth saving.

June 2, 2007 8:04 PM

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