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A debt free certificate in Thailand is the single piece of paper that decides whether a condominium sale completes or collapses at the counter. Without it the Land Office will not register the transfer, however complete the rest of the file is, and however much the buyer has already paid.
Sellers discover this late, usually on the morning of the appointment. Buyers discover it when a transfer date slips by a month. This guide explains what the certificate is, the fifteen day rule that forces the juristic person to issue it, what may lawfully be counted as a debt, and what to do when the figure presented to you looks wrong.
Table of Contents
What a Debt Free Certificate in Thailand Proves
The document is a letter of certification issued by the condominium juristic person, signed by its manager, stating that the unit in question owes nothing. In Thai it is the nangsue raprong kan plot nee. It is a statement about the unit, not about the person selling it, which is the detail that causes most of the trouble.
Common area charges attach to the unit. If a previous owner left arrears behind, the building will present those arrears to the current owner as the condition of issuing the certificate, and the Land Office will not look behind that. Our note on common area fees and the sinking fund explains how the charges are calculated, and the entry on the condominium juristic person and its manager sets out who actually has authority to sign.
Section 29: No Certificate, No Transfer
Section 29 of the Condominium Act B.E. 2522 requires that a request to register the transfer of a unit, or the registration of rights over it, be accompanied by a letter of certification from the juristic person showing that the unit is free of debt. The competent official at the Land Office treats it as a document without which the registration cannot proceed.
Two practical consequences follow. First, the certificate is effectively the building’s veto over the sale, so a seller in dispute with the committee has to resolve that dispute, or pay under protest, before the transfer can happen. Second, the certificate has a short shelf life in practice: fees keep accruing, so a certificate obtained weeks before the appointment may no longer match the ledger on the day.
The requirement does not apply to transfers registered before the juristic person itself was registered, which is why first sales directly from a developer behave differently. Transfer procedure and the official fees are handled by the Department of Lands.
The Fifteen Day Rule
Section 29 also disciplines the juristic person. Where the owner has paid what Section 18 requires, the manager must issue the certificate within fifteen days of receiving the request. That deadline is the seller’s main lever.
Use it properly and it works. Make the request in writing, dated, delivered to the juristic person office against a signature or by registered post, specifying the unit and the intended transfer date. An oral request to a receptionist leaves no record and no deadline. If the fifteen days pass without a certificate and without a stated reason, the owner has a documented refusal to put in front of the committee, the Land Office and, if needed, the court.
Where the building insists on a figure the owner disputes, the usual pragmatic route is to pay the disputed amount under written protest, complete the sale, and pursue recovery afterwards. It is rarely worth losing a buyer over a contested surcharge.
What Counts as a Debt Under Section 18
Section 18 is the source of the obligation, and it matters because only Section 18 debts justify withholding the certificate. The section divides the burden in two.
| What it covers | How the share is worked out |
|---|---|
| Expenses of the owner’s own property, including tax and duty | Borne by that owner |
| Common expenses: upkeep, management, services and common utilities | In proportion to each owner’s ratio of ownership in the common property |
| Sinking fund contribution | Usually a one off payment on the first transfer from the developer, with further levies only if a general meeting resolves them |
Items outside that list are on weaker ground. A fine invented by a committee, a charge for a renovation deposit, a penalty for a pet, a parking fee resolved at a meeting the owner never had notice of: these are contractual or regulatory claims that the building may be able to pursue, but they are not automatically Section 18 debts, and using them to block a Section 29 certificate is open to challenge.
Ask for the ledger, line by line, with the resolution that authorised each charge. A building that cannot produce the resolution usually reduces the figure.
Surcharges Under Section 18/1
Section 18/1 fixes what late payment costs, and it sets ceilings rather than fixed rates:
- Late payment: a surcharge not exceeding 12 per cent per year of the unpaid amount, and it may not be compounded.
- Arrears of six months or more: a surcharge not exceeding 20 per cent per year, and the building may suspend the use of common services and common property and withdraw the owner’s right to vote at a general meeting.
Three points are worth checking against any statement you receive. The rates are maxima, so a building charging 20 per cent from day one is overcharging. Compounding is prohibited outright, which rules out the interest on interest calculations some managing agents produce. And the suspension of services does not extend to cutting off something the owner has contracted for directly with a utility provider or to denying access to the unit itself.
When the Juristic Person Has a Preferential Right
Section 41 gives the juristic person a preferential right for Section 18 debts, which is a priority in enforcement rather than a right to seize anything itself. Debts under the first paragraph of Section 18 rank in the manner of the preferential rights in Section 259(1) of the Civil and Commercial Code and extend to movable property the owner has brought into the unit. Debts under the second paragraph, the common expenses, rank in the manner of Section 273(1) and extend to the unit.
The provision that surprises lenders is the last one: where the manager has duly filed a statement of the debt with the competent official, the preferential right for common expenses can rank ahead of a mortgage over the unit. A buyer taking a mortgaged unit with arrears attached is therefore not protected by the bank’s position.
Old Arrears and Prescription
Some buildings produce a ledger reaching back eight or ten years, often after a change of managing agent. Arrears do not survive indefinitely. Section 193/30 of the Civil and Commercial Code sets the general prescription period at ten years where no other period is specified, and shorter periods apply to several categories of periodical claim.
That makes the age of each item relevant, not just the total. Where a building has done nothing for years and then presents a single large figure as the price of a certificate, the proper response is to ask when each charge fell due and on what authority, and to take advice on which parts are still enforceable before paying the lot. The same discipline applies to money already in the building’s hands: our note on condominium deposit forfeiture in Dika 1511/2569 shows how closely the courts read the paperwork behind a retained sum.
What Buyers and Sellers Should Do
- Sellers: request the certificate in writing at least four weeks before the transfer date, and keep proof of delivery so the fifteen day period is provable.
- Sellers: ask for the ledger at the same time and reconcile it before the buyer is in the room.
- Buyers: make the sale and purchase agreement conditional on delivery of the certificate, and make the seller responsible for all charges to the transfer date.
- Buyers: hold back part of the price until the certificate is in hand, rather than relying on a promise to settle afterwards.
- Both sides: confirm the current monthly rate and the sinking fund position, because the charge follows the unit and the new owner inherits the rate.
- If the certificate is refused without a stated Section 18 debt, treat that as a dispute to be documented, not an administrative delay to be waited out.
Our condominium purchase and due diligence service includes the debt and certificate check as part of the standard twenty five point review, and the broader guide to buying property in Thailand as a foreigner covers the foreign ownership quota and the transfer mechanics that sit alongside it.
Frequently Asked Questions
Can a condo be sold without a debt free certificate?
No. Section 29 of the Condominium Act B.E. 2522 requires the certificate for the registration of a transfer of a unit, and the Land Office will not register the transfer without it.
How long does the juristic person have to issue it?
Fifteen days from receipt of the request, provided the owner has paid the debts arising under Section 18. Make the request in writing with proof of delivery so the period can be proved.
Am I liable for arrears left by the previous owner?
Common charges attach to the unit, so in practice a new owner is asked to clear old arrears before a certificate is issued. The answer is to make the certificate a condition of the sale and to hold back part of the price until it is delivered.
What is the maximum late payment surcharge?
Section 18/1 allows a surcharge of up to 12 per cent per year, rising to up to 20 per cent per year once arrears reach six months. These are ceilings, and the surcharge may not be compounded.
Can the building cut off my water and lift access?
Once arrears reach six months, Section 18/1 allows the suspension of common services and the use of common property, and the loss of voting rights. It does not authorise denying access to the unit itself or interfering with a service the owner contracts for directly.
Can the committee add fines to the figure?
Only Section 18 debts justify withholding the certificate. Other charges may be pursued by other means but should be questioned if they are used to block a transfer, and the resolution authorising each one should be produced.
This article was written and reviewed by Sebastien H. Brousseau, LL.B., B.Sc., who has been based in Thailand since 2004 and has run ThaiLawOnline since 2006, advising foreign owners on condominium purchases, transfers and disputes with juristic persons. If a building is withholding your debt free certificate, or the arrears presented to you do not match what you were told, contact ThaiLawOnline and we will review the ledger and the resolutions behind it.
This article is general information about Thai law and is not legal advice. English translations of the Condominium Act are unofficial and the Thai text governs, and the practice of individual juristic persons and Land Offices varies. Obtain advice on your own situation before acting.
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