Reviewed by ThaiLawOnline, a licensed Thai law firm practising in Thailand since 2006. Thai lawyer of record: Wichuda Atthamethakon, LL.M., Thai Bar Licence 3149/2556.
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Kaifak (ขายฝาก, also written khai fak or kai fak) is a sale with right of redemption under Sections 491 to 502 of the Civil and Commercial Code: the seller transfers ownership of property to the buyer at the Land Office but keeps the right to buy it back, at an agreed price and within an agreed period, which for land cannot exceed 10 years. In practice kaifak is a lending device. The “buyer” is a lender, the “price” is the loan, and the difference between price and redemption price is the interest. It is common in rural Thailand and is the way many Thai families lose their land.
Table of Contents
How kaifak works under the Civil and Commercial Code
Section 491 defines the sale with right of redemption as a sale in which ownership passes to the buyer subject to an agreement that the seller may redeem. The transaction is registered at the Land Office as a sale, so the buyer’s name goes onto the chanote with the note ขายฝาก and the redemption period. Under Section 494 the period may not exceed 10 years for immovable property and 3 years for movables; the parties may extend the period, but never beyond those limits. An extension needs at least written evidence signed by the buyer, and for land it binds a later buyer who registered in good faith only if the extension itself was registered (Section 496).
Redemption price is capped. If no price was fixed, the seller redeems at the sale price. Where a higher price was agreed, Section 499 limits it to the sale price plus 15% per year, mirroring the interest ceiling on loans. If the seller pays, or deposits the money, before the period runs out, ownership returns from that moment (Section 492). If the seller does not, the buyer’s ownership becomes absolute without any court process. That automatic consolidation is what makes kaifak attractive to lenders and dangerous to borrowers.
The 2019 protection Act and what it changed
Because so many farmers lost their land through short redemption periods and unannounced expiry dates, the Act on the Protection of the People in Sales with Right of Redemption of Agricultural Land or Residences B.E. 2562 (2019) now applies whenever the seller is an individual and the property is farmland or a home. Its main rules: the redemption period must be at least one year and at most ten (a period outside those limits is read as one year or ten years, section 10); the buyer must notify the seller in writing, by registered post, between three and six months before expiry, failing which the seller gets a further six months after the deadline; the seller may pay the buyer or deposit the redemption money at the Deposit Office or at the Land Office that registered the sale, and a seller prevented from redeeming through no fault of their own may still deposit within 30 days (section 18); and the seller keeps the use and fruits of the land during the period without paying rent (section 12). The 15% per year cap is restated, and anything else the buyer collects from the seller counts toward it (section 8). A seller who redeems early pays a proportionally reduced premium plus at most 2% a year for the buyer’s lost opportunity (section 10). A sale of such land with a promise or contract to sell it back is treated as a kaifak (section 9), and disputes are heard as consumer cases with the seller as the consumer (section 11).
For a foreigner the practical point is simple: kaifak land is not for sale. A foreigner cannot be the buyer under a kaifak of land, because that would make the foreigner the registered owner, which the Land Code forbids. A foreigner who lends money to a Thai partner should take a registered mortgage instead. A foreigner offered a plot cheaply should check whether the seller is in fact a kaifak buyer whose title has not yet consolidated, or a kaifak seller who no longer owns the land.
Kaifak compared with a mortgage
| Feature | Kaifak | Mortgage |
|---|---|---|
| Owner during the loan | The lender (buyer) | The borrower |
| Registered as | A sale with a redemption note | A charge on the title |
| Maximum period | 10 years for land | No statutory limit |
| Return cap | 15% per year (Section 499) | 15% per year (Section 654) |
| On default | Lender’s ownership becomes absolute | Court-ordered auction; surplus to borrower |
| Land Office fee | 2% of the appraised value plus the taxes of a sale; redemption within the period is a flat 50 baht per plot and carries no specific business tax | 1% of the amount secured, capped at 200,000 baht |
A mortgage costs less to register, leaves the borrower as owner, and returns any surplus from a forced sale. Kaifak is chosen by lenders precisely because none of that applies. Anyone funding a kaifak redemption for a Thai partner should first check the exact expiry date on the title; missing it by a day is fatal, unless the 2019 Act’s notice or deposit rules give the seller more time.
Last reviewed: 26 September 2026. Sections 491, 492, 494, 496, 499 and 502 of the Civil and Commercial Code were read in the Thai text in our annotated Code, and sections 4 to 19 of the 2019 Act in its Thai text. Land Office fees are from the Department of Lands’ manual on registering sales with right of redemption, which applies Ministerial Regulation No. 47 (B.E. 2541), and the tax point from Revenue Department Order Por. 99/2543. The condominium point in the first answer below was not re-verified in this review.
Frequently asked questions
Can a foreigner buy land through kaifak?
No. Kaifak transfers ownership of the land to the buyer at the Land Office, and a foreigner cannot be registered as owner of land under Section 86 of the Land Code. A foreigner may take a kaifak over a condominium unit within the foreign quota, but for land the correct security is a registered mortgage.
How long is the redemption period in a kaifak?
For land and buildings the period agreed by the parties may not exceed 10 years; for movables, 3 years. Where the seller is an individual and the property is farmland or a home, the 2019 Act sets a minimum of one year and gives the seller a further six months if the buyer failed to send the required notice before expiry.
What happens if the seller does not redeem in time?
The buyer’s ownership becomes absolute automatically; no court order or further registration is needed. The seller loses the property and any right to the difference between its value and the loan. That is the main reason kaifak is regarded as a predatory form of lending.
See also: sale with right of redemption, mortgage, loan agreement, appraised value, sales with rights of redemption (kaifak) guide and risks of buying property in Thailand.
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