Loan From Thai Bank For A Farang Pensioner

[lusty]

Dear All, a friend of mine has his parents living on retirement visas in Pattaya. They need a 700,000 THB loan to pay their villa in full. All they have is their pensions, totalling about 100,000 THB/month combined but deposited monthly in their a/c in Italy (they withdraw from the ATM for their daily living).

Question: is there any way to get a loan from a bank or finance on this basis? Or perhaps they should instruct their italian bank to send the pensions into their Thai a/c?

Thank you very much for your help.

Cheers,

Lusty

[bendix]

Extremely unlikely. In fact, I'd say impossible.

You have to look at it from the bank's point of view. They would see such a loan as being extremely unsafe, given the age / life expectancy of the loanees and, more importantly, the ease with which they could just get up and go at any time.

Wouldnt it be easier for them to borrow the money from a bank in their home country?

If the answer is no, then you have to ask why would a bank in a foreign country give them the benefit of the doubt either.

Edited June 23, 2008 by bendix

[AFKAFSinLOS]

Extremely unlikely. In fact, I'd say impossible.

You have to look at it from the bank's point of view. They would see such a loan as being extremely unsafe, given the age / life expectancy of the loanees and, more importantly, the ease with which they could just get up and go at any time.

Wouldnt it be easier for them to borrow the money from a bank in their home country?

If the answer is no, then you have to ask why would a bank in a foreign country give them the benefit of the doubt either.

Think Bendix is spot on. Much more chance of borrowing from back home, for all the reasons he gives. If they are struggling to borrow for some reason, then your friend borrowing on their parents' behalf may have a better chance of borrowing should they want to...?

Does seem odd that retirees on a pension of THB 100k a month, have got themselves in a situation that they "need" 700k on loan from a Thai institution... Sort of comes back to if you need to borrow it, then you won't be eligible to do so...not just in Thailand, but anywhere

[raybingham]

[Think Bendix is spot on. Much more chance of borrowing from back home, for all the reasons he gives. If they are struggling to borrow for some reason, then your friend borrowing on their parents' behalf may have a better chance of borrowing should they want to...?

WRONG and WRONG. You have both missed OP's main point (although he did not make it clear).

The parents appear looking for a mortgage and a Thai based lender would have the benefit of the security of the villa (not sure who's name it is being purchased in though as foreigners cannot own land) - we also don't know what the value of the property is.

A lender will look for a primary repayment source i.e. income and a secondry source i.e. something tangible to get their hands on if they don't/can't pay.

Would agree that it would be difficult for someone of that age to get a mortgage in Thailand (probably any country after the credit squeeze).

If they do have property in a European country it is likely to be unencumbered ad they could raise money on that and remit 700k Baht to Thailand.

[bendix]

With respect, raybingham, I realised the bank would have the security of the villa as collateral. And I agree, that logically, that would make a difference.

Now . let's get back to the real world. This is Thailand. It would be hard enough for a foreigner 30 years younger and earning five times these pensioner's income, complete with WP and all the accroutements to get a mortgage on a villa. What makes you think it the bank would make it easy for these retirees?

[raybingham]

With respect, raybingham, I realised the bank would have the security of the villa as collateral. And I agree, that logically, that would make a difference.

Now . let's get back to the real world. This is Thailand. It would be hard enough for a foreigner 30 years younger and earning five times these pensioner's income, complete with WP and all the accroutements to get a mortgage on a villa. What makes you think it the bank would make it easy for these retirees?

With equal respect Bendix, I agree that they have not got a cat in hel_l's chance in Thailand - but at least Thailand has the asset, whereas Italy (or wherever) does not.

My point was only that - "IF" there was an asset valued at, say 2m Baht and they wanted to borrow 700k Baht, they may have a chance. We do not have all the details. Similarly. if there was a properety asset in Italy (?) then raising the equivalent of 700k Baht may not be too difficult.

Regards

[William Osborne]

Can never understand why old people feel the need to buy property as they won't be around to long enough to enjoy full benifits, in the long term it will be your friend who stands to gain as he is mostly to inherit it ??

if so maybe he should make an offer to help out

[longball53098]

All this bantering about what if's?

Why not just go to a couple of Thai banks loan departments and ask?

Seems simple and straightforward that way.

And we know that you should not accept the first response of "no" as the final answer.

[imaneggspurt]

This will be no different from purchasing a new car,. with a large deposit it can be done,. ie if the property has a value of say 3 million or so anyone will lend 700.000 on it( interest rates wont be favourable i feel ) ask the bar girl wives, they do it all the time ! ..one local to us borrowed 600.000 and went to a cambodia border casino and lost the lot ! wait til the farang husband comes back !

[imaneggspurt]

With respect, raybingham, I realised the bank would have the security of the villa as collateral. And I agree, that logically, that would make a difference.

Now . let's get back to the real world. This is Thailand. It would be hard enough for a foreigner 30 years younger and earning five times these pensioner's income, complete with WP and all the accroutements to get a mortgage on a villa. What makes you think it the bank would make it easy for these retirees?

Because the bank is in a win win situation,.high interst rate for a good re payer,( they wont lend without a substancial equity ) repossesion for a bad payer,.

[Jimjim]

What about the whole Bangkok Bank for condos loan? Possible you could contact them.

[lusty]

Dear All, thank you very much for the support offered. I'd like to clairify the story, which to me seems a catch 22 situation:

1. parents have bought a 7 million THB villa in Pattaya, creating a company to buy the land/house in a moo baan;

2. after various disputes with contractors etc they need now to pay the remaining 700,000 THB to get the chanot title; then they want to resell the property and move out, esacerbated by the all troubles with the moo baan management;

3. their money is tied up in Italy in some sort of fixed deposit or T-bonds, something like that, which requires both of them to go to Italy and get the money out; an expensive option, hence this post to seek alternatives and help these poor chaps. Apparently, without going there, nothing can be done by fax, email, etc. as it's a small bank;

4. apart from pensions, they own nothing else in Thailand;

Question 1: will the bank give a loan without proof of chanot title in their name? If they do, the guys get the chanot and the banks get enough guarrantee.

Question 2: their nominal company has a deposited capital of 3 millions; would this matter?

Thank you again!

[bendix]

With respect, raybingham, I realised the bank would have the security of the villa as collateral. And I agree, that logically, that would make a difference.

Now . let's get back to the real world. This is Thailand. It would be hard enough for a foreigner 30 years younger and earning five times these pensioner's income, complete with WP and all the accroutements to get a mortgage on a villa. What makes you think it the bank would make it easy for these retirees?

Because the bank is in a win win situation,.high interst rate for a good re payer,( they wont lend without a substancial equity ) repossesion for a bad payer,.

Nonsense. You obviously have no experience of the Thai banking system. To compare a bargirl borrowing money from a bank to a retired foreign couple is ridiculous.

[imaneggspurt]

With respect, raybingham, I realised the bank would have the security of the villa as collateral. And I agree, that logically, that would make a difference.

Now . let's get back to the real world. This is Thailand. It would be hard enough for a foreigner 30 years younger and earning five times these pensioner's income, complete with WP and all the accroutements to get a mortgage on a villa. What makes you think it the bank would make it easy for these retirees?

Because the bank is in a win win situation,.high interst rate for a good re payer,( they wont lend without a substancial equity ) repossesion for a bad payer,.

Nonsense. You obviously have no experience of the Thai banking system. To compare a bargirl borrowing money from a bank to a retired foreign couple is ridiculous.

Actually you are wrong again,my neighbor did just that, needed money for personal reasons, they took his house as security and did him a short term loan, i went to the bank with him,.there was a lot of paperwork involving the thai company but he did get it,.

[raybingham]

Dear All, thank you very much for the support offered. I'd like to clairify the story, which to me seems a catch 22 situation:

1. parents have bought a 7 million THB villa in Pattaya, creating a company to buy the land/house in a moo baan;

2. after various disputes with contractors etc they need now to pay the remaining 700,000 THB to get the chanot title; then they want to resell the property and move out, esacerbated by the all troubles with the moo baan management;

3. their money is tied up in Italy in some sort of fixed deposit or T-bonds, something like that, which requires both of them to go to Italy and get the money out; an expensive option, hence this post to seek alternatives and help these poor chaps. Apparently, without going there, nothing can be done by fax, email, etc. as it's a small bank;

4. apart from pensions, they own nothing else in Thailand;

Question 1: will the bank give a loan without proof of chanot title in their name? If they do, the guys get the chanot and the banks get enough guarrantee.

Question 2: their nominal company has a deposited capital of 3 millions; would this matter?

Thank you again!

OK - now we know they have assets here and in Europe.

Borrowing only 10% of a property asset in Thailand may be possible for a retired couple. Best advice given earlier, try asking one or two banks in Thailand. Personally, not hopeful and there is sod all in it for a bank as the loan will only be on their books for a short time (if they can sell).

Best course may to borrow against the fixed bonds or whatever. Very good collateral but I don't know the Italian banking systems (but the Lombardis have got fair history !) Maybe this can be achieved by phone/email to Italian bank ????

Good luck.