Home Loan Questions - Need Advice

[Ritti]

Hello and thanks for reading

I am looking at buying a house (my parnter already owns the land in Bangkok so we agree it's a good idea to build on it).

1) Can we get a joint loan as I being farang cannot own a house. (whats are the advantages of a joint loan?)

I believ you can get a loan of up to 70% of the value of the property)

2) Must pay off the entire loan within 10 years, is this also correct?

Thanks, any tips, advice or companies for building the house would be great.

[skybluestu]

I know of two banks who have recently changed their policy so that foreigners can be co-borrowers and not just guarantors, KTB and Kasikorn. But there are many who won't accept applications from Thai's with a foreign spouse so best to check each one.

[InterestedObserver]

Farangs can indeed own a house in Thailand, just not the land it sits on. Many threads posted on ThaiVisa with discussion of 30 year lease and/or usufruct to secure the land for building a house in a foreigner's name.

[richardt1808]

if skyblu's post is correct, that would be great news. I did this same exercise about 2 years ago with my partner and at that time we were rejected by all the major banks here. Kasikorn and Bangkok Bank seem to have the best interest packages at present and Bangkok Bank have actually been aggressively persuing clients in the loan market lately.

As your proposed house is not part of a bona fide project, things will be a little more complex, and yes the repayment term may be as short as 10 years. I think that when accepting the loan application, the bank will require approved plans for your house along with cost estimates so that they can have something on which to base their value assessment.

Assuming you get all of that sorted out, you will also need to consider options for protecting your investment should your relationship come to an end at some point (the fact that you may be co-borrowers in the eyes of the bank, may not necessarily be recognised equally in the eyes of the rest of the legal system). I have already received some legal advice pertaining to my own situation and you do have the option of entering into a joint personal contract with your partner whereby you specify your intention to invest jointly and you can specify what should happen in the event that anything happens which results in you being unable to live together in the house at some point in the future (this could be as a result of termination of the 'relationship' or other personal circumstances). You both may then agree upfront that in such case, the asset needs to either be sold and the proceeds from the sale get divided between you in whatever percentage, or that either party may offer to 'buy' the other out according to a percentage of the total value of the asset. If you wanted slant the deck more in your favour, you could consider having your partner lease you the land on a 30 year basis. Such as lease would be registered with the Land Department and would be a very solid guarantee for you.

Best of luck with this and keep us posted on the eventual outcome.

Edited February 2, 2010 by richardt1808

[skybluestu]

Actually it looks like things have changed in the last 6 weeks, on Dec 5th 2009 the KTB website stated this regarding applicants on their Home Loan page.

'Thai nationality. If applicants have foreigner spouse, the spouse can be co-borrowers. (Foreigners cannot be borrower even though they have Thai work permit.)'

But today I checked again and it nows states this

'Thai nationality. (Foreigners cannot be borrower or co borrowers even though they have Thai work permit.)'

How nice of them!

[clinique]

we have been customers of BBL, KBank, and SCB for more than 10 years.

All accept applications from Thai with foreign spouse. WP not necessary just confirmation of income and relationship with bank..

We are currently buying a new house and this policy remains true right now..

[MegaRanter]

I bought one as co borrower fro KTB, late 2008. I co own the debt, I doubt I co own the house if push comes to shove. The bank gave us more than what the house was actually worth, not my idea but who could have refused, believed my credit profile was super ok.

The sight of priority account with SCB(StanChartBk) offshore made the process 'please sign here sir'.

[brianinbangkok]

Yes I got a bank loan with my ex-wife before she did a runner.

She owns the house and its her bank loan , we (read I) had to pay 1/3 down cash.

I was only the guarantor and still am apparently.

However they will have a very hard time collecting I am told because it would require a foreigner to pay for loan for land.

And that is illegal.

Friends working for other Thai banks told me its actually breaking the law.

I find it weird we can be guarantors for a loan to buy land, seems contradicting Thai Law.

I hope it never comes to it but if they request me to pay I will just go and have a talk at the land department.

But for now the house is for sale and likely things will be worked out in a nice way for all involved.

[gregb]

A farang friend of mine, not even legally married to his girlfriend (although they do have a child together) was just approved for 70%, 15 year mortgage through Bangkok Bank. This happened just a few weeks ago.

My wife and I were approved for 80%, 30 years, but this was a few years back.

It is very doable. Just stay away from Government Housing Bank and you shouldn't have any problems. I have commented in other threads on GHB's take on the law, and they will not even consider your application. Private banks are much more interested in doing business. Make a good case and they'll happily loan you money. The term and the amount are negotiable. Tell them what you want and see what they come back with.