Home Loan Interest Rate?

[Youbloodybeauty]

Hi,

I've just been shown what my wife's family are paying to the Siam Commercial Bank in interest on their 700,000 Baht home loan. I couldn't believe and checking their statements it is a whopping 15%

I've also checked at Siam Commercial here: http://www.scb.co.th/img/en/rate/loan.pdf

There are two rates, one "Default" and one rate as "Normal". Even the "Normal" is high at 11.375%. Anyone know what the criteria is for these rates?

Apparently the 15% interst rate came in about 7 months ago and prior was 5-6% for a few years. From what my wife said they have tried to refinance at another bank at lower rates but because of their low income were not accepted.

Anyway, not sure how I can help (besides the obvious!) but before I/we go into the bank does anyone has have any experience negotiating a better rate at this bank or have any other advice to get a lower interest rate.

I looked up their savings deposit rates and at < 1% is a massive gap!

Cheers YBB

Edited April 14, 2009 by Youbloodybeauty

[samuibeachcomber]

aussie i cannot help you,bu no bloody wonder the thai banks are cashed up,paying savers 1% and charging borrowers 15%.

[bangsaenguy]

Incorrect info. We just borrowed money from SCB to buy 2 condos. Interest is much less the that.

Edited April 14, 2009 by bangsaenguy

[trogers]

Perhaps they used SCB's credit card to buy the house?

[Youbloodybeauty]

Incorrect info. We just borrowed money from SCB to buy 2 condos. Interest is much less the that.

Thanks bangsaenguy,

The info from the family is correct because I have a handful of statements showing 15% plus that pdf on the SCB site has 15%.

OK It's hard to understand the facts but they have not tried to refinance at all - wife meant when the first go the loan SCB were the only one that would give them a loan.

Apparently they have asked the bank where they pay the loan about the high interest rate and they said to go to the branch where they got the loan. Guess what - they haven't bothered for 7 months.

I am guessing that their initial rate of 5-6% had finished 7 months ago and the loan reverted to this "Default" 15%. I bet if they bother to go to the place they got the loan then they might be able to get a lower rate.

Anyway, see how we go.

Cheers YBB

[eljeque]

Double check

I am making a big assumption here, so forgive me if I am wrong.

This is just a guess, but IF, and it is a big IF, they are paying the house off over 10 years, not 30 like in the USA, the rate may appear to be really high, but they may really be paying a lrge part of the principle off each month.

The last two loans which I have helped people get through using a friend's ex-wfe (a nurse income) and another loan using his maid's as the borrower, with her son as a gaurantor, for 10 and 15 years in length pay about 7 or 7.5% interest.

[trogers]

Incorrect info. We just borrowed money from SCB to buy 2 condos. Interest is much less the that.

Thanks bangsaenguy,

The info from the family is correct because I have a handful of statements showing 15% plus that pdf on the SCB site has 15%.

OK It's hard to understand the facts but they have not tried to refinance at all - wife meant when the first go the loan SCB were the only one that would give them a loan.

Apparently they have asked the bank where they pay the loan about the high interest rate and they said to go to the branch where they got the loan. Guess what - they haven't bothered for 7 months.

I am guessing that their initial rate of 5-6% had finished 7 months ago and the loan reverted to this "Default" 15%. I bet if they bother to go to the place they got the loan then they might be able to get a lower rate.

Anyway, see how we go.

Cheers YBB

Check the loan contract. SCB has high interest charges on ODs, not housing loans. Overdraft is easy to get, while housing loan has many pre-conditions.

[thaicbr]

Also if they are behind in the payments Thai banks charge more interest. rather than default fines.

[Youbloodybeauty]

Also if they are behind in the payments Thai banks charge more interest. rather than default fines.

Thanks for all the replies.

My guess is they have either missed or haven't paid the full repayment and 'thaicbr' has hit the nail on the head. I'll find out when the sister gets home (if she has more of the statements) and when bank opens again.

Cheers YBB

[bangsaenguy]

Incorrect info. We just borrowed money from SCB to buy 2 condos. Interest is much less the that.

Thanks bangsaenguy,

The info from the family is correct because I have a handful of statements showing 15% plus that pdf on the SCB site has 15%.

OK It's hard to understand the facts but they have not tried to refinance at all - wife meant when the first go the loan SCB were the only one that would give them a loan.

Apparently they have asked the bank where they pay the loan about the high interest rate and they said to go to the branch where they got the loan. Guess what - they haven't bothered for 7 months.

I am guessing that their initial rate of 5-6% had finished 7 months ago and the loan reverted to this "Default" 15%. I bet if they bother to go to the place they got the loan then they might be able to get a lower rate.

Anyway, see how we go.

Cheers YBB

I'm reluctant to quote the rate my wife got cos I'm not positive but it was considerably less than 5%.

[Pomthai]

Wife has fixed rate home loan with SCB which they offered at 3.25% and we negotiated down to 2.75%. That was a year ago though.

[donne]

Sound very strange for me.

I get the home loan from TFB last year and it is 2.75% + MLR.

Are you sure it is home loan? Probably personal loan, like the credit card but with large amount of money.

The personal loan charge you a very high rate of interest since there is no guarantee for bank.

Ask your wife to stop using this type of card. It should be only for emergency.

Ask SCB to re-finance and put the house in the bank for guarantee. Everything can be negotiated, try it first. Although, it probably is slim chance to success because you are SS class client. Super Small.

[MoonRiverOasis]

For mortgages SCB are curently offering 1.99% fixed for the first year, with MLR less 1% thereafter. Current MLR rate is 6.875%, which will be dropping by 0.10% tomorrow: http://www.scb.co.th/en/nws/abt_nws_090417-rate.shtml

Sounds like your friends got shafted nicely.

[Youbloodybeauty]

For mortgages SCB are curently offering 1.99% fixed for the first year, with MLR less 1% thereafter. Current MLR rate is 6.875%, which will be dropping by 0.10% tomorrow: http://www.scb.co.th/en/nws/abt_nws_090417-rate.shtml

Sounds like your friends got shafted nicely.

MoonRiverOasis - thanks.

It's been sorted out.

Firstly, the 15% is definately because they either missed or did not pay the full repayment. It is a fine as mentioned above. Also, it is a home loan. It's not a credit card or personal loan or whatever.

Went to the SCB today with the wife and inlaws to discuss this "15%" and see if we could get a better rate than the 6.25% they are currently paying (this is the rate after they had a reduced rate for the first year or so) but SCB basically said we would have to go to another bank. I guess the loan is too small to get a lower rate.

Cheers for the info, YBB

Edited April 22, 2009 by Youbloodybeauty