Borrow 800'000B for yearly Extension ?

[Pattaya46]

A friend of mine, who may be soon concerned by his Embassy decision about Income Letter, asked to help him to get information at his bank about a loan of 800'000B. He is 70 yo, retired and owns a condo worth about 4 million baht that he wanted to use a "guaranty" for the loan.

Immediate answer from KasikornBank: No work Permit, No loan.

 

We insisted, explaining why 800'000, and only 20% in value, etc. A superior got involved and at the end they took all information (passport, chanote) and said they will call "upper chief" and call us back quickly.

Less than 1 hour latter they call back. "No work permit, not possible"... but they told us to contact on precise person from our condo who should be able to help ?? and she is in the condo office right now !!

So down we go, and yes this very well known lady is waiting for us. (A Thai lady from Chinese origin who own tens of units in our condo)

 

To make it short. Can do, but conditions are :

• 800'000B loan, minimum 6 months
• 5% to get the loan
• 2% interest per month
• + about 4'000B fee to register the loan at the Land Office

So it could be done, but this way would cost about 140'000B !!! 

 

Now I you have a better solution (should not be too difficult) please don't hesitate to post it. Thanks.

 

PS: "Visa Agent" is not the subject here.

 

[Jingthing]

Yeah, that fee is ridiculous.

Sounds like a business opportunity if people can do that formally for a reasonable fee.

It should be noted it is not illegal to fund these accounts by loans.

There are the seasoning requirements but there is no language saying it can't be loaned money.

Of course then there are the "agents" that have been offering bank based extensions without the applicant having either the money or the seasoning. Without getting into the "legality" of those schemes, there is always the chance of a major crackdown on that practice, if that isn't happening right now already.

[DrJack54]

Use visa agent. 25000 baht. Easy peasy. 

[poohy]

Contact is basically a money lender charging ridiculous fees and illegal interest rates!

Surely a better idea is for gentleman to open a new bank account with Atm card

Borrow 800k credit account from a friend gives them atm card in case of emergencies and minimize risk

Pay say 5K per month interest

Then after  the 3 months return/withdraw  money.

 

Almost sounds like it’s been done already eh?

 

Edited November 20, 2018 by poohy

[Jingthing]

6 minutes ago, DrJack54 said:

Use visa agent. 25000 baht. Easy peasy. 

Yes, but also dodgy bodgy. 

[Pattaya46]

7 minutes ago, poohy said:

Contact is basically a money lender charging ridiculous fees and illegal interest rates

 

From http://library.siam-legal.com/thai-law/civil-and-commercial-code-loans-section-650-656/

Section 654. Maximum Interest is 15% per year

 

Interest shall not exceed 15% per year; when a higher rate of interest is fixed by the contract, it shall be reduced to 15% per year.

 

Now do you know of other ways to borrow money from a chanote ?

[KittenKong]

17 minutes ago, Jingthing said:

Yeah, that fee is ridiculous.

Standard Thai loan shark rate.

[Jingthing]

3 minutes ago, KittenKong said:

Standard Thai loan shark rate.

Sure. Who needs a condo for collateral if you're knees aren't broken yet?

[KittenKong]

6 minutes ago, Pattaya46 said:

Now do you know of other ways to borrow money from a chanote ?

You could arrange a private loan with someone at a more sensible rate in return for a lien on the chanote. The only mistake that I can see here was made by approaching a local loan shark. They are just a bunch of usurers who will never give a good deal. Of course, impecunious Thais use them all the time which is probably why your Chinese lady owns so many condos.

[moe666]

800,000 in the bank for extension is also about having money to spend if needed. It may not say any where it is illigal but I would not go around advertising it on the internet

[steve73]

With many people needing to bring 800k into T/L, I'd expect there to be plenty of loans available outside of the 3 months required for yourself.

The only problem is ensuring adequate security over the loan..

 

For example, I'd have no problem lending 800k for 3 months at say 1%/mon with a 4MM+ condo as security.. just need to work out the details.  E.g. if the loan is defaulted, then how can the property be formally transferred without showing cash brought into the country.. 

[garyk]

I bet there are going to be thousands of people in the same boat!

Man what a mess.

[bendejo]

55 minutes ago, Pattaya46 said:

... but they told us to contact on precise person from our condo who should be able to help ?? and she is in the condo office right now !!

 

Funny how that works out, you learn of this loan shark via bank employee's back channel.  And in YOUR specific building! 

 

 

[Pattaya46]

1 hour ago, KittenKong said:

The only mistake that I can see here was made by approaching a local loan shark.

Not really a mistake. He just wanted to know what was on offer. He does not need these 800k now, and certainly would have never signed such a loan ! 

 

1 hour ago, KittenKong said:

You could arrange a private loan with someone at a more sensible rate in return for a lien on the chanote.

1 hour ago, steve73 said:

// The only problem is ensuring adequate security over the loan..

For example, I'd have no problem lending 800k for 3 months at say 1%/mon with a 4MM+ condo as security.. just need to work out the details.  E.g. if the loan is defaulted, then how can the property be formally transferred without showing cash brought into the country.. 

The loan is registered at the land office. So I understand it means the condo can't be sold before the loan is paid back. Unsure what happen if the borrower can't pay back. Probably need to go to court asking for the condo to be sold to pay back ?

Finding a way to not register at the Land Office - for just 3 months  - would make things easier and cheaper... but also illegal...

 

1 hour ago, bendejo said:

Funny how that works out, you learn of this loan shark via bank employee's back channel.  And in YOUR specific building! 

Yes... Who doesn't think about a "commission" for this employee ? 

Edited November 20, 2018 by Pattaya46

[Huayrat]

There are agencies out there that will borrow you the 800k and put it in your bank account for a fee of around 20k

[balo]

That's what agents are for . You borrow 800k from them short term . You pay the fee of around 20k . A lot cheaper than any loan sharks. 

 

Or you can always borrow from a friend , if it was me I would just ask a Norwegian bank for a short term loan, but I kept my address in Norway so I have options. 

 

 

 

[watcharacters]

6 minutes ago, Huayrat said:

There are agencies out there that will borrow you the 800k and put it in your bank account for a fee of around 20k

 

I know of one for far less than  20K.  

 

And is well established..

[HampiK]

2 hours ago, steve73 said:

With many people needing to bring 800k into T/L, I'd expect there to be plenty of loans available outside of the 3 months required for yourself.

The only problem is ensuring adequate security over the loan..

 

For example, I'd have no problem lending 800k for 3 months at say 1%/mon with a 4MM+ condo as security.. just need to work out the details.  E.g. if the loan is defaulted, then how can the property be formally transferred without showing cash brought into the country.. 

with a 12% Interest I think it still would be possible to find many who would be interested in this deal, I would probably be happy with a deal like that ????

 

I think as others suggested the easiest and probably cheapest way is go by some agencies. For private it's always more work, as the agencies know exactly what they have to do.

[watcharacters]

1 hour ago, Pattaya46 said:

The loan is registered at the land office. So I understand it means the condo can't be sold before the loan is paid back. Unsure what happen if the borrower can't pay back. Probably need to go to court asking for the condo to be sold to pay back ?

Finding a way to not register at the Land Office - for just 3 months  - would make things easier and cheaper... but also illegal...

 

I was under the impression the loan sharks simply take possession of whatever is offered for collateral against the borrow (sic) in instances of default.

[Orton Rd]

3 hours ago, DrJack54 said:

Use visa agent. 25000 baht. Easy peasy. 

But corrupt and illegal

[fanjita]

4 minutes ago, Orton Rd said:

But corrupt and illegal

But convenient and cheap.

[Pattaya46]

3 hours ago, DrJack54 said:

Use visa agent. 25000 baht. Easy peasy. 

35 minutes ago, Huayrat said:

There are agencies out there that will borrow you the 800k and put it in your bank account for a fee of around 20k

...

I clearly wrote in my OP that this topic was not about "Agent",

but half of messages talk about "Agent"...  

 

I don't know any Agent (in Pattaya) that will put 800'000B on your account during 3 months,

and that was what this topic was supposed talking about...

 

[Orton Rd]

25k v 1900 baht is not cheap

[Scottjouro]

Although not illegal in terms of law, borrowing money at a fee to fulfill a visa reqirement, is against the intent of the rules put innplace to ensure pensioners have adequate funds to live on while in Thailand,  

 

Exploiting this loop hole this will eventually make immigration modify or change the rules, ie a simple requirement that the 800k funds must come into the country from an outside source via  TT for similiar will put an end to this practice.

 

 

[fanjita]

14 minutes ago, Orton Rd said:

25k v 1900 baht is not cheap

Agreed but depends on your circumstances, doesn't it?  Cheap if you haven't got the means.  

[fanjita]

5 minutes ago, Scottjouro said:

Exploiting this loop hole this will eventually make immigration modify or change the rules, ie a simple requirement that the 800k funds must come into the country from an outside source via  TT for similiar will put an end to this practice.

Sorry, but pure speculation as this has been going on for years.  Don't forget, TiT.

[bkk6060]

6 minutes ago, Scottjouro said:

Although not illegal in terms of law, borrowing money at a fee to fulfill a visa reqirement, is against the intent of the rules put innplace to ensure pensioners have adequate funds to live on while in Thailand,  

 

Exploiting this loop hole this will eventually make immigration modify or change the rules, ie a simple requirement that the 800k funds must come into the country from an outside source via  TT for similiar will put an end to this practice.

 

 

I think you do not get it.

The agents are and will continue to be used.

In fact TI encourage the use of them.  The paperwork is most always in order and no Falang BS arguing with them.

It is huge money that is distributed amongst many Thai police.

They will not change or modify anything regarding this.

[Scottjouro]

The facts:

a loan of 800'000B.

He is 70 yo, retired

Owns a condo worth about 4 million baht

No credit history  in Thailand one presumes

 

answer from KasikornBank: No work Permit, No loan

 

I think K-bank have been very polite in this instance declining this loan citing the work permit rule

 

No bank who knows their stuff would make a loan under these conditions, work permit or not...

 

why would K-bank want "another" condo they cant sell on their books if the person, defaults or dies during the term of the loan ?

 

Person has no visible income stream - stated retired

 

No credit history (assumed) in Thailand

 

 

 

 

[Scottjouro]

6 minutes ago, fanjita said:

Sorry, but pure speculation as this has been going on for years.  Don't forget, TiT.

Threats to ban people for overstaying in Thailand was speculated and threatened for many years as well...they got there in the end...never say never 

[fanjita]

1 minute ago, Scottjouro said:

answer from KasikornBank: No work Permit, No loan

Going around in circles.  Then it's back to the agent at 20k or whatever the going rate is to deposit the funds.  Seriously!