Buying A Car On A Loan At A Thai Dealership

[BigA]

Howz the law on this work? What kind of loopholes are there?

Is it possible as I am assuming it is. I know there are many obstacles what helps company, credit, work permit, owning a house, how about already owning a vehicle. The interest rates in Thailand are low so its enticing but I dont want to go after something that is unobtainable..

[slappyharry]

with your work permit, the loan would only be allowed for however long your work permit is valid for, if its a yearly renewal for your work permit and you have just recieved it they would allow a 1 year payback scheme.

[slappyharry]

treble post, sometimes i wonder where my brain goes for holidays.

[Sumitr Man]

^But if you don't have a letter of guarantee from your employer - or another Thai national - forget it!

SM

[slappyharry]

sorry.

[Sumitr Man]

with your work permit, the loan would only be allowed for however long your work permit is valid for, if its a yearly renewal for your work permit and you have just recieved it they would allow a 1 year payback scheme.

...and even with this, you'll still need a letter of guarantee from your employer, or another Thai national.

[jingjingna]

SM, would the above apply even if one is married to a Thai? Now, I am confused!

Recently I was given the opportunity to purchase a condo with finance available. I do happen to have a WP but that is only valid a year at a time..so what's what?

Jingjingna

[Sumitr Man]

SM, would the above apply even if one is married to a Thai? Now, I am confused!

Recently I was given the opportunity to purchase a condo with finance available. I do happen to have a WP but that is only valid a year at a time..so what's what?

Are you borrowing the money, or the good wife? You can stand guarantee for a Thai national no problem; but official BoT rules are that you should only be able to borrow (domestically) for the duration oustanding on the WP [a test: go to a Quick Cash Bureau and see what they tell you].

That said, I know lots of people who this rule "strictly" applies to, but to whom the bank/finance company have simply said "yeah, but we know you have been here for x amount of years, have family, pay tax, have a provident and pension fund, etc. - don't worry too much". As such, I wouldn't fret too much over it.

It's more like "another" reason to say no, rather than "the" reason to say no

SM

EDIT

An after-thought: was the financing offered as part of the condo purchase package - by the developer(s)? If so, check this very carefully indeed. I've heard horror stories where condo units have been sold to farangs whereby the farang paid a monthly amount to the developer for, like, 2 years - thereafter the farang needed to arrange financing for a balloon payment. When it came time to make the balloon payment, the farang couldn't arrange what they had been told was a simple financing package.

I guess what I'm trying to say: if you are a farang, always arrange 100% of the financing BEFORE you put any money down on the property.

[bkk_mike]

If you're married to a Thai - just take your wife along to the car dealer to sign the paperwork. So long as you're putting down a reasonable deposit (20% or so), and you can show a reasonable amount in the bank - you shouldn't have any problems even if, like my wife, she doesn't actually work.

[jingjingna]

Sumitrman,

Thanks for your comments..I am seriously questioning this condo purchase now. The purchase would have been in my name not my Thai spouses..in fact, I never mentioned to the developers that I am married. They said as long as I have a WP I can legally purchase a condo and get finance on it, not 100% but as good as. They showed me a standard payment plan ..paying them a total of say Baht250,000 between now and completion of the project around April 2006 and after that monthly payments over a choice of 5,10 or 20 years.

I must admit I was somewhat surprised how easy it all sounded and the sales rep, based in the office on the doorstep of the project reassured me that it was all legit and so on. After reading your comments I am starting to question the whole thing.

What would you do? I have no experience of puchasing a property here so someone could well and truly lead me up the garden path and I wouldn't know it!

[Sumitr Man]

JJ:

First off, please don't let me be the reason you don't do something - I urge you to talk with someone far more qualified than I.

That said, most of what I write is publicly available information. IME, the scheme you have outlined is a classic "Thai" financing structure. In this regard I have 2 problems:

1. they are using your monthly payments to finance the construction of the project. However, if not enough units are sold, the money will run dry - and the project will not be completed. Most "old-hands" these days simply don't put deposits down on condo units not already completed - or at least completely financed. We all know someone who was in court during 97-98 trying to get their money back because they had signed-up for this exact type of deal, only for it to all come crashing down. IMHO, there's a huge difference between asking someone to make a one-off 20-50k deposit (non-refunable) on a unit and asking them to make a monthly instalment plan. The second of these 2 has real alarm bells ring.

2. the financing package you set-out is simply not feasible under Thai law - IF YOU ARE A FARANG. No farang I know, short of having PR, has been offered a 20 year mortgage, much less a 30 year mortgage. Now, if you were to be putting 50% of the purchase price down, and the repayment on the remaining 50% was over 5-6 years, with a WP, I could see how the financing company may bend the BoT rules slightly to make this appear like something else - for example: there's no regulation saying you cannot get a home improvement loan, but rather than "improving the home", you purchase it. I've certainly heard of this type of deal. But in these cases, the loans have been for much less of a period than what you say.

So, in short - if it was ME, I would walk away. YOU, OTH, should talk with someone who can give you far better advice on what would happen if "worst case scenario" did happen.

Sorry I couldn't be of more help.

SM

[jingjingna]

Sumitr Man,

Thanks alot for your input. I have only put down a very small deposit at this stage so am able to walk away BUT on principle I want to get back what I have put down by pointing out to the sales rep that what she is/was proposingis utter BS.

Would Sunbelt be able to help me out with this one or would I be better off speaking to a lawyer? Is there anyone you could recommend ?

Thanks once again for your help!

Jingjingna

[Sumitr Man]

Sunbelt may well be able to help you out. Otherwise, why not drop our other sponsor, Indo, a pm. Both of these, IME, are good - and both seem to have in-house lawyers.

[jingjingna]

Cheers Sumitr Man !

[frequentatore]

1. they are using your monthly payments to finance the construction of the project.  However, if not enough units are sold, the money will run dry - and the project will not be completed.  Most "old-hands" these days simply don't put deposits down on condo units not already completed - or at least completely financed.  We all know someone who was in court during 97-98 trying to get their money back because they had signed-up for this exact type of deal, only for it to all come crashing down. 

They use the cash of one project to finance another... Some of the largest builders in Thailand went down in 97. I don't think I'm authorized here to name the crooks who still owe us our downpayment of half million baht on one of their many unfinished projects (still in court... one of the top builders a few years ago).

Buying from plans here is a lottery. Some projects in Thailand are half finished and stay this way for 10 years, even forever... Poor or no security, no maintenance... often a war zone!

I think it was during the jewelry fair last month that PM Thaksin was wondering how come some of the people who went bankrupt in 97 are still wearing some very expensive jewelry... They screwed thousands of people and will never go to jail because they are part of the biggest families in this country... the biggest crooks of this country.