An official has found life after retirement miserable after he agreed to be a loan guarantor for a student -- and the case has prompted the Student Loan Foud (SLF) to remind all guarantors of the risks they are taking.
Fund manager Chainarong Kajchapanan warned on Wednesday that guarantors should be aware of the legal obligations that spring from guaranteeing that money students borrow for their studies is paid back.
The SLF's latest reminder followed the case of Thongchai Poompuang, who recounted on his Facebook page the harsh lesson he learned from signing a contract as a loan guarantor for his friend's son.
Mr Thongchai said his retirement has been ruined, with his house seized by the Legal Execution Office in Chiang Mai until he pays back all the money the student owes the fund. The name of the student was not disclosed.
The former official of the Agricultural Extension Department guaranteed a loan that's ballooned to 126,670 baht with interest -- and now has to pay the fund 6,335 baht a month for 20 months.
His house has been seized by the Legal Execution Department, he said, and will only be returned when every satang is paid back to the fund.
"I am paying the money for somebody else. I cannot stand it," Mr Thongchai told reporters.
He said on his Facebook page that he had looked forward to a good life in Chiang Mai after retirement. "Now I have to pay the price for karma from my past life," he wrote.
His Facebook post has drawn public sympathy -- and criticism for the student, who applied for a loan of 78,610 baht with Mr Thongchai as a guarantor in 1997. The student failed to pay it back, and the debt became due in 2000. With accrued interest, the amount owed is now a whopping 126,670.
"I just wanted my friend's son to finish his studies," he wrote on Facebook.
The SLF said the student and the guarantor were sued in 2008 and the student promised to pay back the loan at a rate of 900 baht a month for nine years to settle the court case. The student later broke his promise -- and when the fund could trace neither him nor his assets, it decided to go after the guarantor.
The SLF has given loans totalling 500 billion baht to 5 million students. According to its statistics, 85% of the guarantors are their parents, another 14% are relatives and 1% are not directly related to the borrower.
Mr Thongchai is not the first guarantor to bear the burden of irresponsible borrowers.
The best-known case came last year, when teacher Wipha Banyen acted as guarantor for loans taken out by 60 of her students to finish their degrees between 1989-1999. Only about half of them repaid the loans, she later found out from the fund.