Home Financing For Dummies...

[buddhafly]

anyone with a few spare minutes that can explain financing basics for buying a condo here would be appreciated.

honestly don't know much about current desirable interest rates, and plusses and minusses of different length of loan terms, and lastly is it beneficial to put most of my savings into it to reduce interest on loan, etc, or better to put the minimum down.

thanks and apologies for my ignorance on this.

[jrbkk64]

It is almost impossible to get any loan in Thailand for a foreigner. The only two exceptions I am aware of is going through UoB or BBL in Singapore (very high interest rate, loan in SGD or USD and high contract cost) or you can apply for a mortgage at some Thai banks if your are an official resident. To become the latter takes forever and outcome of the process is not at all certain.

[buddhafly]

thx jrbkk

i believe i can borrow thru my thai wife where i am the 'guarantor'...

just curious on the other bits....

b

[Trebilcock]

I may be in a broadly similar situation, where my sister in law is trying to buy a house in Thailand and (I think) wants me to act as guarantor. Is that possible, given that I live in the UK and have no kind of bank account or financial history in Thailand? And if I did become guarantor and things went pear-shaped, could a Thai bank really enforce it? Thanks very much for any advice or info.

[NordicMan]

If you trust them enough, borrow the money in UK and give it to your wife or sister in law to buy the house. Sister in law can repay you for your monthly repayments.

If you're talking about a 1.5-3 million baht house, that is probably not an amount that would kill you if things went ti_ts up.

If she's looking at 20 million baht condo, things are different.

If the amount is small enough, you could take a normal unsecured consumer loan in any UK bank.

Keep in mind that the property will be extremely illiquid. If you need to sell it to get your cash out, you may have to sell at a huge discount to find a buyer. It may be a high risk strategy to place all your savings in that property, regardless of any tax benefits, cash flow concerns etc. What would you do if you wanted to move somewhere else? Sell it at half price?

I am not 100% sure of this, but generally banks don't like foreigners as guarantors. Reason is that if the loan is not repaid, it may be very difficult for the bank to legally recover the money from someone based in another country. Likewise, UK banks will not give you a regular mortgage for property in Thailand, because if you do not repay, they will not have legal rights to reposess your Thai property.

[NordicMan]

anyone with a few spare minutes that can explain financing basics for buying a condo here would be appreciated.

honestly don't know much about current desirable interest rates, and plusses and minusses of different length of loan terms, and lastly is it beneficial to put most of my savings into it to reduce interest on loan, etc, or better to put the minimum down.

thanks and apologies for my ignorance on this.

Some considerations

1. What is your home country

2. Where do you live now

3. How old are you (approximately)

4. Are you still working

5. How long until you plan to retire

6. Do you plan to permanently live in your Thai condo or use it as holiday home

7. What price range are you looking at? 1-3million baht? 5? 10? 20?

8. How much deposit could you put down?

9. Do you have a thai partner/wife

10. Do you need to be able to sell the condo if you don't want to live there, move somewhere else, or you need the cash for something else?

11. Where in Thailand would you like to buy?

rgds

nm

[Trebilcock]

If you trust them enough, borrow the money in UK and give it to your wife or sister in law to buy the house. Sister in law can repay you for your monthly repayments.

If you're talking about a 1.5-3 million baht house, that is probably not an amount that would kill you if things went ti_ts up.

If she's looking at 20 million baht condo, things are different.

If the amount is small enough, you could take a normal unsecured consumer loan in any UK bank.

Keep in mind that the property will be extremely illiquid. If you need to sell it to get your cash out, you may have to sell at a huge discount to find a buyer. It may be a high risk strategy to place all your savings in that property, regardless of any tax benefits, cash flow concerns etc. What would you do if you wanted to move somewhere else? Sell it at half price?

I am not 100% sure of this, but generally banks don't like foreigners as guarantors. Reason is that if the loan is not repaid, it may be very difficult for the bank to legally recover the money from someone based in another country. Likewise, UK banks will not give you a regular mortgage for property in Thailand, because if you do not repay, they will not have legal rights to reposess your Thai property.

Thanks very much for the sound advice, NordicMan. Much appreciated.

[torrenova]

You can "fix" it using time and some common sense. Look at the documents the bank wants to see to give a mortgage, think about what enquiries they will make and then see whether you have the ability to put in place all that they need to satisfy their underwriters. It is not rocket science.

Of course, all the do-gooders will say shame on you and shout illegal and other such <deleted> but just ignore them. They either buy nothing or condos or just sign over millions to their Thai family and hope like shit that they will be ok.

The only other decent way is a back to back loan but that requires you to have the cash in the first place or to borrow it and take the FX risk.