Getting A Mortgage

[BOOKEMDANO]

Hi,

Following some careful consideration and some good advice, me and the g/f have decided to buy a second property to rent out. It will only be a small condo unit somewhere in the region of 500,000 baht but just wanted to ask if anybody had any experience with getting a mortgage from a Thai bank before?

What is the usual down payment one must cough up and do they differ?

Any recommendations or advice from those who have gone this route before in order to secure a property would be much appreciated.

Bookem'

[richardt1808]

Hi,

I've just completed a purchase for a much higher amount, but the basic info is still the same.

Mortgage in your name, as a foreigner - impossible

Mortgage with you and your wife as co-borrowers - nigh impossible (have heard of a few banks who will accept the application, but never heard of a successfull one).

Mortgage in your girlfriend's name with you as a guarantor - possible, but subject to creditworthiness of both parties.

If you are buying at a high-profile project, 100% mortgages are available if your gf meets the credit requirements. The bigger the potential credit risk, the bigger the deposit may be, but in any case you wont find any of this type in BKK in your price range (you dont mention where you are). For second hand apartments, or smaller projects, the banks are a lot more strict so you may well end up being asked for up to 30% deposit.

Best of luck

[BOOKEMDANO]

Hi,

I've just completed a purchase for a much higher amount, but the basic info is still the same.

Mortgage in your name, as a foreigner - impossible

Mortgage with you and your wife as co-borrowers - nigh impossible (have heard of a few banks who will accept the application, but never heard of a successfull one).

Mortgage in your girlfriend's name with you as a guarantor - possible, but subject to creditworthiness of both parties.

If you are buying at a high-profile project, 100% mortgages are available if your gf meets the credit requirements. The bigger the potential credit risk, the bigger the deposit may be, but in any case you wont find any of this type in BKK in your price range (you dont mention where you are). For second hand apartments, or smaller projects, the banks are a lot more strict so you may well end up being asked for up to 30% deposit.

Best of luck

Thanks for that info

I will be buying in Chiang Mai so the potential for buying there is much more likely. My only concern is the amount of deposit required but as you say 30% might cover a second hand condo/apartment and keep the banks more inclined to accept. I am keeping the g/f's bank account attractive by depositing money in it every month and she also has a fair paying job with references so im sure (i hope) this will suffice that criteria.

[dave111223]

Thanks for that info

I will be buying in Chiang Mai so the potential for buying there is much more likely. My only concern is the amount of deposit required but as you say 30% might cover a second hand condo/apartment and keep the banks more inclined to accept. I am keeping the g/f's bank account attractive by depositing money in it every month and she also has a fair paying job with references so im sure (i hope) this will suffice that criteria.

Just bought a second hand townhouse in my wife's name (her name on mortgage)...Banks advertised mortgages between 70% - 85%.

The best we were able to get was 80% (so 20% down payment). And this is 80% on the bank valuation of the property (not on the sale price). So the bank valuable could be lower than the sale price (in my experience they usually use the sale price, but can be lower, very rarely higher)

So i would suggest preparing yourself to pay an absolute minimum of 15% down...excluding taxes/transfer fees which will cost you additional.

If buying a new building it's much easy to get a large % loan, but there seems be a very hefty premium on buying new property in Thailand. (Probably due to the loans being easier)

[gregb]

You are going to have a tough time if this is only a GF and you do not have a child together. It would be easier if you married her. Doesn't mean impossible, just difficult.

I would suggest if this relationship is not serious, you make sure the GF is able to qualify entirely on her own. That means assuming 20% down, the mortgage payments over 20 years should not exceed 40% of her declared income for the past 2 years. This means income she can actually show and has paid income taxes on. If your relationship is serious, consider filing the paperwork at the ampur. It will give you more credibility when you apply for the loan.

If you can meet the restrictions, the process is fairly easy. If you can not, things get more difficult. You may need to apply to a half a dozen banks or more before you find one that says yes. Generally, banks are hesitant to accept a guarantor with no family ties to the borrower. If you have a child together or are married then most will not raise an eyebrow. Otherwise, they get concerned.

Remember this is Thailand though and all things are possible. Just because 10 say no, doesn't mean the 11th won't say yes.

I have a friend who was accepted by SCB under the circumstance you mention (just a GF who could not qualify on her own and no familial ties), but they required 50% down. This was several years back. Things change all the time here.

[dave111223]

You are going to have a tough time if this is only a GF and you do not have a child together. It would be easier if you married her. Doesn't mean impossible, just difficult.

I would suggest if this relationship is not serious, you make sure the GF is able to qualify entirely on her own. That means assuming 20% down, the mortgage payments over 20 years should not exceed 40% of her declared income for the past 2 years. This means income she can actually show and has paid income taxes on. If your relationship is serious, consider filing the paperwork at the ampur. It will give you more credibility when you apply for the loan.

If you can meet the restrictions, the process is fairly easy. If you can not, things get more difficult. You may need to apply to a half a dozen banks or more before you find one that says yes. Generally, banks are hesitant to accept a guarantor with no family ties to the borrower. If you have a child together or are married then most will not raise an eyebrow. Otherwise, they get concerned.

Remember this is Thailand though and all things are possible. Just because 10 say no, doesn't mean the 11th won't say yes.

I have a friend who was accepted by SCB under the circumstance you mention (just a GF who could not qualify on her own and no familial ties), but they required 50% down. This was several years back. Things change all the time here.

In my experience the opposite was true. At most banks we applied they suggested for my wife just write "single" status. As this was easier for them to process a loan without a foreign husband involved.

Some banks did put us as married, but only required to see my passport, and her being married to me did not help her case...

Also as for the family ties...at one bank (Kbank) my wife applied with mother in law as a co-signer. This was the only bank that flat out denied our application. So just sticking extra co-signers/guarantors onto the application is not always best advised.

Agreed with the point about applying to many banks.