If a Thai developer misses the deadline or goes under
The honest way to discuss this risk is not to pretend it does not exist. Projects on Phuket have missed deadlines and stopped, buyers have lost money, and it was reported in the papers. Here is what the law protects, what it does not, and which clauses I read before a deposit because of it.
Thailand has escrow, but it is voluntary
The Escrow Act B.E. 2551 (2008) is in force. It does not, however, require a developer to place buyer money in escrow: the mechanism applies only where the parties agree to it. In practice it is rarely used — developers cite fees and administration, few banks participate, and most buyers have never heard of it.
The conclusion is simple and unwelcome: by default your instalments go straight to the developer and fund its construction. Escrow is something to negotiate for, not something you are entitled to.
What the prescribed contract actually gives you
Here the protection is real, and it is rarely explained. Section 6/2 of the Condominium Act, introduced by the fourth amendment B.E. 2551, requires developers to use the sale-and-purchase form prescribed by the Ministry of Interior. That form has mandatory content:
- Default interest capped at 15% a year, and a penalty on the buyer of no more than 10% of the price
- If the developer cannot transfer within the stated period it must return all money received with default interest, and that does not remove the buyer's right to claim damages
- Force majeure may suspend performance, but not indefinitely — the limit is one year; if the project cannot continue after that, money is refunded with interest at a fixed-deposit rate
- A five-year warranty on structure and two years on everything else
- A fine for using a contract that does not follow the prescribed form
If the deadline is missed anyway
The sequence runs: a written demand under the contract, then a complaint to the Office of the Consumer Protection Board, then a civil claim — disputes of this kind are heard as consumer cases. If the company collapses, bankruptcy proceedings are added.
Now the part nobody says out loud. Obtaining a judgment is achievable. Collecting on it is a different matter: it depends on whether the company still has assets, and a buyer ranks behind secured creditors in a bankruptcy. Which is why the real work happens before the money moves — in choosing the developer.
I will check the developer and the contract on your project before you pay a deposit, and bring in a lawyer.
Message me on WhatsApp →This is not theory. Documented Phuket cases
In 2018, as reported by the Bangkok Post, the managing director of Emerald Development Group was arrested; the investigation concerned five unfinished projects, around three hundred buyers were reported affected, most of them foreign, and police sought complainants through embassies. In Patong, the Ace 1 project, due for completion in April 2015, led to several charges against the developer including fraud and deceptive advertising; The Thaiger reported twenty-one complaints covering forty-eight units.
I mention these not to frighten anyone. The opposite: in both cases the risk was visible in advance — in the developer's record, in the permits, and in how payments were structured. That is what gets checked before a deposit.
What I check before money moves
- How many projects the developer has completed, with addresses and dates, and how actual delivery compared with what was promised
- The construction permit and the title to the land under the project — as documents, not as reassurance
- Whether the contract follows the prescribed form, and what it says about delay, force majeure and refunds
- Who receives the payments, and whether escrow is offered at all
- How the schedule is built: the more payment is tied to construction milestones, the better for the buyer
- What happens to your money if the project stops
In short
The Thai state does not insure buyers of unfinished property — it prescribes a contract and provides a procedure. Everything else comes down to choosing the developer and reading the paperwork before the transfer. That is my part of the job, and the legal review goes to a Thai lawyer before the deposit rather than after.
- Investment property selection — net yield calculated on specific units
- Projects I work with — developments where I hold direct terms from the developer
Legal, visa and tax work is not mine — it belongs to partners I use constantly
I am an investment strategist: I select the property, calculate the net return, check the developer and run the transaction. Anything that needs a legal, immigration or tax qualification goes to specialists I have worked with for years.
- Thai lawyers — document and contract review, land title, registration at the Land Office, wills, powers of attorney, corporate questions
- Visa partners — choosing and filing the right route for your situation: investment-based, LTR, Thailand Privilege, retirement, DTV
- Tax specialists — reporting in your country of tax residence, treaty credit for Thai tax, declarations on foreign assets
- Company formation in Thailand — when a structure is genuinely needed and lawful
- Rental management and concierge — letting the property, transfers, yachts, events
I introduce partners personally, matched to your actual question, so that you speak to the specialist who handles it rather than to a general inbox. Message me and I will make the introduction.
Frequently asked
Is there escrow for off-plan purchases in Thailand?
What happens if a Thai developer misses the completion date?
Where do I complain about a Thai developer?
Can I get my money back if the developer goes bankrupt?
Lyubov Fortunova
Investment strategist and founder of Fortunova Capital Group. I have lived on Phuket for more than five years and run every deal myself: I select the property, calculate the net return, check the developer and hold the process together until the keys are handed over. Lawyers, visa and tax specialists come from my own circle.
“I count net, not dreams”
I will check the developer and the contract on your project before you pay a deposit, and bring in a lawyer
I answer personally, within the working day, in any time zone. No calls unless you want them. A question about the article is free and commits you to nothing.
