Fred2
The difference between Hak Tanggungan (Indonesian)and mortgage (West)as explained to me. In mortgage, if the debtor could not fulfill his/her obligations, the land is transferable This could not happen in Hak Tanggungan, as the creditor cannot own the land, but only has the right to sell them via auction.Any other ?????
Cisco Kid
Morning Fred 2,Just another way of saying, we aim to please.Have a nice day...
Markit
In all the many, many stories of land purchases and legal rights that I've run into in my 8 years living on Bali I have to say as loud as possible: not one, NOT A SINGLE FECKING ONE has fallen into trouble or been dissolved due to legal issues. NOT ONE. Many, [B]if not all[/B], came apart due to the blindness (tunnel vision) of one or all of the Bule parties to the deal.PROSPECTIVE BUYERS/BUILDERS OF BALINESE VILLAS: TAKE NOTE!1) Make sure your partner (I mean the one you're sleeping with) is as committed as you are.2) Make sure your country of origin has no more hold on you (children, grandchildren,pets, parents, etc.)3) Make sure your finances are valid (plan as much as you can afford to build, then build half that - oh, excepting the pool make that as large as you can afford)4) Just because Made says you are part of his family don't give him $200,000.00 to buy that nice plot of land for you. I could go on, but you get the idea.
davita
If PerCa prevail in their application to the MK...WNI [B]will[/B] be permitted to own Hak Milik land in their own right.The next question then is of community property if 1. Divorce or 2. Death of the WNI.1. Community property doesn't need to be precisely divisible...fancy cutting the family car down the middle. It is normal, in any jurisdiction, for community property asset splits to be agreed. In RI the Hak Milik property would be assured to the WNI so an offset would have to be agreed by both. Generally, if not agreed and goes to court, the wife gets the house and the husband gets the dog and the debt.:icon_e_biggrin:2. Currently, this is the case anyway. If a WNI has inherited Hak Milik, before marriage, and dies, and the property reverts to the WNA it has to be sold or dispensed within 1 year. The same could apply in this case. An alternate would be to have a trusted relative 'nominee' sign a right to use to the WNA...or simply change the title from Hak Milik to Hak Pakai.
Cisco Kid
Hi again Fred2,As you may already know, according to the Indonesian Law on Hak Tanggungan, Hak Tanggungan is a security right encumbered on the Right on Land as mentioned in the Law No. 5, the Agrarian Law of 1960 (discussed yesterday). I'm no Indonesian lawyer, but according to Indonesian legal practitioners with whom I've discussed the subject, Hak Tanggungan and its anglo saxon rough equivalent, a mortgage, have key features in common. Both involve a transaction between the two parties: someone who provides a loan (creditor) and someone who should pay the debt (debtor). Both terms indicate that land is used to guarantee the transaction. For the security interests of overseas investors in land development, the key feature is that their names are actually recorded on a sertifikat hak milik as mortgagee holders of Hak Tanggunan. They can then possess the original certificate and BPN will not allow the recorded Indonesian owner to sell the property as long as the investor has Hak Tanggunan.When the foreign investor surrenders his Hak Tanggunan, derives from the terms of the underlying loan agreement. As previously explained in this Forum, this is all 100% legitimate.That's my 2 cents worth....BSH
Cisco Kid
I think we need to recognize that every case is different. Also significant is that Indonesiaunlike anglo saxon jurisdictions is civil, not common law. Among other things, this meansthat there is no "case precedent" here. That's why every case is different. In my own community property matter, at the risk of oversimplification, as a foreign spouse who purchasedthe property during the marriage, the property was not physcially split, but my 50% interest wasprotected in an investor interest sense. I had a legal right (there are no equitable rights in this Country) to half of the value of the land. Being a non-citizen, I could never own half of the dividedproperty in my name.
Fred2
Hi again Fred2,As you may already know, according to the Indonesian Law on Hak Tanggungan, Hak Tanggungan is a security right encumbered on the Right on Land as mentioned in the Law No. 5, the Agrarian Law of 1960 (discussed yesterday). I'm no Indonesian lawyer, but according to Indonesian legal practitioners with whom I've discussed the subject, Hak Tanggungan and its anglo saxon rough equivalent, a mortgage, have key features in common. Both involve a transaction between the two parties: someone who provides a loan (creditor) and someone who should pay the debt (debtor). Both terms indicate that land is used to guarantee the transaction. For the security interests of overseas investors in land development, the key feature is that their names are actually recorded on a sertifikat hak milik as mortgagee holders of Hak Tanggunan. They can then possess the original certificate and BPN will not allow the recorded Indonesian owner to sell the property as long as the investor has Hak Tanggunan.When the foreign investor surrenders his Hak Tanggunan, derives from the terms of the underlying loan agreement. As previously explained in this Forum, this is all 100% legitimate.That's my 2 cents worth....BSH[/QUOTE]b. Domisili pihak-pihak sebagaimana dimaksud pada huruf a, dan apabila diantara mereka ada yang berdomisili diluar Indonesia, baginya harus pula dicantumkan suatu domisili pilihan di Indonesia, dan dalam hal domisili pilihan itu tidak dicantumkan, kantor PPAT tempat pembuatan Akta Pemberian Hak Tanggungan dianggap sebagai domisili yang dipilih;Kecuali apabila diperjanjikan lain, sertifikat hak atas tanah yang telah dibubuhi catatan pembebanan Hak Hanggungan sebagaimana dimaksud dalam Pasal 13 ayat (3) dikembalikan kepada pemegang hak atas tanah yang bersangkutanSo what do you write in the deed that would make the Debtor default. If he never defaults he always owns the land, or if he gets a second Hak Tanggungan & pays you out??? he can never lose?????
Cisco Kid
Morning Fred2, Since this kind of thing is done by our notaris, I suggest you should find the answer from any good notaris, SH/PPAT. And the reality is, every deal is different.
Markit
So what do you write in the deed that would make the Debtor default. If he never defaults he always owns the land, or if he gets a second Hak Tanggungan & pays you out??? he can never lose?????[/QUOTE]Your nominee can never get a new mortgage on "your" property as long as you hold the original land certificates. He can declare those as stolen or destroyed at the ministry but since the original (on record at the land ministry) has the mortgage loan along with your name annotated as lender that will be reproduced along with the "new" certificate. I think/hope.
Cisco Kid
There are apparently many other differences, but I believe the main distinctive feature for our purposes, is the one you have so well described.
davita
Your nominee can never get a new mortgage on "your" property as long as you hold the original land certificates. He can declare those as stolen or destroyed at the ministry but since the original (on record at the land ministry) has the mortgage loan along with your name annotated as lender that will be reproduced along with the "new" certificate. I think/hope.[/QUOTE]By original land certificates I assume you mean 'Sertipikat Tanda Bukti Hak' . I have mine right in front and nowhere does it have mine or wife's name. It has the previous owner and the current one 'my nominee'. There was no mortgage.My understanding is that it would be possible for the nominee to declare this document lost, get another and use it for collateral, without my knowledge.
Cisco Kid
what Markit says is spot-on. Glad he's spreading the good word on this basic mortgage benefit.
davita
I've no intent to argue as you guys know more about the mortgage system than I. After all, who would lend me money without a death benefit...?:icon_e_surprised:However, this subject has been hashed many times and I recall the idea of attaching a mortgage from a foreign lender to a nominee on Hak Milik property had legal issues.My recollection was..... to create a mortgage the lender has to be a 'registered lender' under RI law and I understood no-one was aware nor knew how to do this. Thus it may be that the mortgage attachment to the title may be illegal. Anyone have relevant information...I've searched but cannot find.
Cisco Kid
This needs clarification. There should not be a "nominee" at all. That term smacks of a backdoor structure that may not be outright unlawful, but could well have enforcement implications. Instead there is a capital development investment loan between the overseas land development investor and his Indonesian joint venture partner. The mortgage secures the investment of the offshore investor, making him the registered mortgagee. I have never run into a "Lender Registry", and will definitely take that up with our legal counsel at our next weekly meeting and feedback you further afterwards.
davita
I'm sorry but Markit did mention about a nominee and mortgage and you said "Markit is spot on.... etc" That's why I posted. Now you mention we are not discussing nominee but a more structured ownership and mortgaging including PT or PT PMA's. I have no comment...nor clue...about that.I agree the terminology of 'nominee' is misleading and was created by realtors...for want of a better word. Both Markit and I have argued here that the owner of Hak Milik property is the one whose name is on the 'sertipikat' and the 'Akta dual Beli' (Bill of Sale). I've suggested the rest is trust and belief that 'Akta Pernyataan' (Deed of Statement) which adds intent and content to those documents will hold in court if there's any dispute in the future. Attempting to circumvent the real 'ownership' using those statement deeds is where the system is questioned.I talked with my bank manager about a loan against the 2 properties we have but (HSBC) are adament they can only lend to the SHM owners.
Cisco Kid
"Both Markit and I have argued here that the owner of Hak Milik property is the one whose name is on the 'sertipikat' and the 'Akta dual Beli' (Bill of Sale)." --> irrefutable"I've suggested the rest is trust and belief that 'Akta Pernyataan' (Deed of Statement) which adds intent and content to those documents will hold in court if there's any dispute in the future. Attempting to circumvent the real 'ownership' using those statement deeds is where the system is questioned."--> Some say "trust is good and no trust is better." I for one, do not think it is any wiser to base an important land transaction on "trust" than it would be to predicate a transatlantic crossing on the ship's lifeboat. Both are required, but for use only when all else fails...--> That Akta might be anything from the kiss of death, to a blessing of the acquisition, depending on its content."I talked with my bank manager about a loan against the 2 properties we have but (HSBC) are adament they can only lend to the SHM owners."--> That's exactly what they'd be expected to say. But if HSBC or anyone else loans to the owner, it can be secured by recording a mortgage on the certificate at BPN.keep rollin' in the right direction... i likes it banyak...
davita
1.--> That Akta might be anything from the [COLOR="#FF0000"]kiss of death[/COLOR], to a blessing of the acquisition, depending on its content."I talked with my bank manager about a loan against the 2 properties we have but (HSBC) are adament they can only lend to the SHM owners."2.--> That's exactly what they'd be expected to say. But if HSBC or anyone else loans to the owner, it can be secured by recording a mortgage on the certificate at BPN.[/QUOTE]1. I agree...yet some believe the content will protect in [B]any[/B] situation. The reality is the Akta Pernyataan is only a contract of intent. A contract is generally inferior to Law. If the nominee decided to do anything that contradicts the Akta it may offer legal option on a 'breach of contract'...but not of ownership. The problem is that some notaries have written the Akta Pernyataan to circumvent the Law....and why I agree with you on your point highlighted above.2. That of course is a normal event available to most Indonesians. As the WNI 'nominee' [B]is[/B] the rightful owner he/she can mortgage, or use as collateral, and that will be recorded. It doesn't specify on the Sertipikat anything about the foreigner, only on the statement deed, in which the bank has no interest. As I said...I hold all those deeds in my safety box but if my nominee said the Sertipikat was missing, received a copy and went to a bank to use as a loan. How would I know?...:dejection::hopelessness:
Fred2
Your nominee can never get a new mortgage on "your" property as long as you hold the original land certificates. He can declare those as stolen or destroyed at the ministry but since the original (on record at the land ministry) has the mortgage loan along with your name annotated as lender that will be reproduced along with the "new" certificate. I think/hope.[/QUOTE]Sorry Markit this is incorrect When Hak Tanggungan Deed is registered, you receive a Encumbrance Right certificate and the land certificate goes back to the land holder. If land holder wants to give you the land certificate so you feel warm and fuzzy that ok. The land certificate can have more than one Hak Tanggungan Deed registered to it. Who ever is the first registered Deed is paid first and goes down the line.This is only a money transaction and you can only get your money back, you can not get your hands on the land.Markit if you go down the Hak Tanggungan road.Your PATT makes up the deed.Your name, how much the loan is + interest + any terms you want within the law.You cannot register the deed because you are not a permit resident of Indonesia, you can add someone in the deed that will act on your behalf or your PATT.The deed is registered at Kantor Pertanahan by drawing up of land encumbrance right and records in the land book the land title which becomes the Encumbrance Right object as well as recording on the land title certificate.You receive encumbrance right certificate as above.To void the encumbrance right The owner of the land pays the amount of money in the Deed The owner of the land defaults on what is written in the Deed. You need court orders to sell the land so you can get your money back. But if you never put how much per year/ when it has to be paid by, how can the owner default on the deed?More than one Deed can be put on the land certificate as above. The owner can wait 10 yrs go to the bank or loan shark, pay out the deed, sell the land and villa. and have a very happy life.Or the government decide to check land titles and finds foreigners have bank roll land title. RED flag first to be check.
Markit
The problem with all the discussions of property ownership the world over is that they get lost in minutia fairly quickly. That is what courts, also the world over, are kept busy untangling for 90% of their time. No ownership patent is %100, not here or anywhere else. Owners or those that want to be can only cover as many bases as they can see after due consideration of all the variables. That's what this thread is/should be about. At the end of the discussion you should weigh up carefully your capacity for risk and loss and proceed with your plans accordingly. As I have written many times and in many forums I have yet to see a property deal here in Indonesia go wrong due to legal issues, NONE. I have seen too many go wrong due to personal problems. Get you life in order first and then buy land in Bali and build your dream. It's really, really worth the risk!That I know!
davita
In my fairly long, so far, life I've bought and subsequently sold many properties...UK (London and Surrey), Hong Kong (New territories and City), Canada (2 x Metro-Vancouver) and USA (Arizona). None of those transactions posed any problems because law in those jurisdictions is clear. However, taxation was an issue that I suffered.Indonesian law on property is not clear, particularly for foreigners, and is risky. If not averse to some risk, and due diligence taken, then property ownership in Indonesia can be rewarding....as Markit has said.That's the purpose of this forum.....to debate the pros and cons so newcomers to property ownership can benefit from other's experience.
