Buying House

[Amdesign]

The question is: besides booking fee 50,000 THB (that is OK) the seller requires 200,000 THB on making contract one week later.

I wonder how it can be becasue approval of loan by bank takes 3 weeks. So how we can sign the contract and pay contract fee without making sure we can get a loan?

Is it normal practice in Thailand?

[givenall]

The question is: besides booking fee 50,000 THB (that is OK) the seller requires 200,000 THB on making contract one week later.

I wonder how it can be becasue approval of loan by bank takes 3 weeks. So how we can sign the contract and pay contract fee without making sure we can get a loan?

Is it normal practice in Thailand?

Seem like they don’t care about you getting loan and it is assumed you will buy the house with cash or loan.

Negotiate . You will not get your 200,000 back if you don’t get the loan and back out of the sale

[chris11]

Hello

I was in the same situation like you. The seller ask me also to sign the contract into 1 Week. I told them that i need some time to approval the bank loan and i will not sign before. At the end ,the time between booking and sign the contract was about 6 weeks. I think you should speak with the seller it is no reason to sign the contract 1 week after booking.

And is this normal for Thailand ? Sure they want to make the contract so fast as possible to get the commission.

Chris

The question is: besides booking fee 50,000 THB (that is OK) the seller requires 200,000 THB on making contract one week later.

I wonder how it can be becasue approval of loan by bank takes 3 weeks. So how we can sign the contract and pay contract fee without making sure we can get a loan?

Is it normal practice in Thailand?

[Gary A]

An earnest money deposit that is not refundable is normal, BUT, the next larger deposit should be put in an escrow account and returned to you is the loan should fall through. I would NEVER put that money in the seller's hands.

[chanwit]

The question is: besides booking fee 50,000 THB (that is OK) the seller requires 200,000 THB on making contract one week later.

I wonder how it can be becasue approval of loan by bank takes 3 weeks. So how we can sign the contract and pay contract fee without making sure we can get a loan?

Is it normal practice in Thailand?

My wife (and I) just bought a house with a developer in Nonthaburi. So far what you said sound familiar. I guess we were going on blind faith because we wanted the house so much and the project had Siam bank backing. There were many new requirements, one after the other before the bank finally approved the loan; each one dragging you past the point of no return. We talked with many new home builders and they all had discounts and payout plans on paper. The average was 20,000TB reserve fee and 10 months to pay out a down payment. In our case the down payment was 50% because I'm farang.

Don't forget, a loan from a bank will require a life insurance policy for the amount of the loan. If you are contributing to the loan payoff that will probably be another hurdle to jump.

[eljeque]

Arrange the loan before you hand over any money.

You/your wife, have no idea if you will get the loan or not.

No reason to risk anything on it.

[Kf6vci]

Don't fall for it - all the urgency is fabricated by the seller. Be careful and also get a serious home inspection. Friends bought some new home in a development. Then had to return it due to unbelieveable defects.

If seller doesn't play ball, there are other places, you might even find something better!

[stgrhe]

The question is: besides booking fee 50,000 THB (that is OK) the seller requires 200,000 THB on making contract one week later.

I wonder how it can be becasue approval of loan by bank takes 3 weeks. So how we can sign the contract and pay contract fee without making sure we can get a loan?

Is it normal practice in Thailand?

You should think of it more as a proposal from the seller than a firm requirement. Firstly, to demand a contract to be signed within a specific time is always wrong since the contract draft should first be reviewed by you if the seller provides the draft, and then negotiated. Accepting a draft by the seller as it is would to my experience give the upper hand to the seller since it is unlikely it is balanced with your rights as the buyer properly recognised.

A more proper wording would be that the first payment should be made within X days after the effective date of contract. Furthermore, as you intend to seek a loan you need to put in a provisional clause so the contract does not become effective until the loan has been granted including an escape provision for both you and the seller should the loan not be granted.

The basic rule for the payments should always be that you as the buyer get something for the payments you are making. Hence, a first payment just because of the contract has been signed has in mine mine no merits at all. Both of you are making commitments of equal value so why should you pay something?

However, the seller might ask for an advance payment but such payment should always come with a banker's guarantee as you pay something while the buyer has yet not delivered anything. An even better alternative, as mentioned by another poster, is to open an Escrow account.

Any serious builder would agree to the above and in the case of accepting to pay a down payment do not pay more than ten per cent. Again, a serious and solid builder would agree while the "cowboy style" so-called builders would not.

Finally, you should ask the builder whether he intend to build with his money or yours and by all means do a proper due diligence. It is worth the efforts.