Cheap credit for Thais?

[jackdd]

My GF (and her mom on my GFs name) are having credits (Using credit cards, 3 in total).

They pay this off every month, i never payed much attention to it, total sum about 100k THB

Yesterday i had a look at the pay slips, and saw that she pays effectively 30-50% interest per year (The 15% maximum by law is working well....) for these credits.

Just by shifting the money from the expensive ones to the cheaper one she could of course save a few thousand baht a year, but 30% per year is of course still very expensive.

I don't want to get involved money wise, so me giving her the money is not an option, but of course i want to help her save money on these credits.

So what is the cheapest way for a Thai (she works for the army, just in case there should be any special deal for them) to get a 100k THB credit (maybe to be payed off over a year or two) to pay off the credit cards?

Edited February 3, 2018 by jackdd

[Pib]

That 15% max applies to loans like from a bank; not credit cards.   

 

Thai credit cards typically have an annual interest rate of approx 18% "for purchases.    Now for cash advances (a.k.a., personal loan via credit card that a lot of Thai do) the interest rate is around 30%.   Not really too different from many western credit cards for folks with average or poor credit....or even good credit.  The AEON classic credit card is typical of Thai credit credit cards regarding interest rates, fees, etc.

 

[jackdd]

Ok, i see, thanks for the explanation. I'm used to the 15% that i would have to pay if i took a credit on my german credit cards

I wrote "credit", but i'm of course also talking about "loans" if they are cheaper, simply the cheapest way for her to get 100k THB from a bank. Does anybody have any tips for this?

[BEVUP]

Obviously going through a shark

Are you sure it's 30 - 50 %

I've known people who have taken out loans (not with banks ) 400,000 over 5yrs making the total payable 600,000 (used 300,000 vehicle as collateral )

If my calcs are right ( checked on loan App ) that's 20 %

 

[jackdd]

Yes, one could assume it's through a shark, but it's not. Two of them are Krungsri First Choice and the other is Aeon. I took the bills which she gets every month, and if you add the interest and the fees it's 30-50% per year.

[Pib]

46 minutes ago, jackdd said:

Yes, one could assume it's through a shark, but it's not. Two of them are Krungsri First Choice and the other is Aeon. I took the bills which she gets every month, and if you add the interest and the fees it's 30-50% per year.

Neither AEON or Krungsri credit cards charge interest as high as 50%...not even close.  In an earlier post I showed what AEON charges....below is what Krungsri First Choice charges....basically the same as AEON cards.   Ditto for other Thai bank credit cards regarding the interest they charge.

 

I'm going to assume the GF is using the cards for personal/cash loans where the interest rate is a lot higher than for a purchase....it that case she is paying up to 28% per year on those cash advances in basic interest plus another 3% upfront fee which works out to 31%.     Now for purchases its around 18%.

 

Credit card cash interest is high since no collateral is required get cash....different from a bank loan which has a lower interest rate since collateral is usually involved.

 

Now I guess if the card balance is not being paid off fast enough the interest can snowball when looking at the amount paid over a couple of years.  And if her monthly payment is going towards the "purchase balance" first there may not be any going towards the "cash balance" which allows the cash balance to grow fast/snowball.

 

From Krungsri First web site

 

 

[jackdd]

Here is the most expensive of them

So for the interest it's 641.01 / 25241.62 = 2.5% per month or 30% per year

For "fees" it's 555.55/25241.62 = 2.2% per month or 26% per year

So effectively 46% per year at Krungsri First Choice

[Pib]

Apparently the GF is not meeting her cash loan installments/payments....that is, not paying enough, missing payments which racks up additional charges in the Accrued Credit Usage Charge column....its kind  like a penalty...can snowball.

 

 

 

[jackdd]

I asked her and she claims she always payed in time, but as i know her.... could be very well be that she didn't do it

I checked the loans and somehow the rates for a "regular" loan seem to be at about 22%, better than the 30% what she is having now, but still worse than the 18% she would have to pay if she purchased something with a credit card.

I plan to buy a few things anyway, so i will probably just tell her to get a credit card, then i can use her card for buying this stuff, give her the cash which she can use to pay off her existing credits, and then she pays off the money on the credit card at 18%, which saves her nearly 2000THB per month already.

 

I just had a look at the website of "her" bank, and this seems to be quite good: https://www.tmbbank.com/en/cards/credit-cards/tmb-so-chill.html

If they are not hiding anything, it seems to be "just" 17.1% (with the 5% cashback from 18%) on cash advance so she could just take the money and pay off her existing loans, and no 3% extra fee when withdrawing it

Edited February 6, 2018 by jackdd