A Mortgage In Thailand

[anthony26brit]

I am working here and have been doing so for over a year. I am thinking of staying here permanently, so I would like to know my chances of finally being able to buy even a condominium. I am aware of the land rule regarding foreigners so a house is out of the question, correct ? I earn 50,000THB a month not a lot I know but is there any chance of a mortgage here like back in the UK ? Also what about buying a car ?

Any help would be very greatful.

A.

[Nomad97]

You give few details about yourself but, to put it bluntly and without beating about the bush, I would say absolutely no chance of either a mortgage or finance for a car.

[lopburi3]

Although there are untested work around for land ownership I would not touch them. Condo ownership would be an option but direct finance options I believe have been removed for the present.

Believe some second hand car dealers might offer credit. I know I have acted as guaranteer on Thai car loans without issue at both new and used dealers.

Will move this to proper area.

[Soutpeel]

Starting with car's first, if you have a WP and have a Thai who will co-sign the loan for you, getting the first car on finance is pretty straight forward, typically 25-40% down payment will be required dpendent on what you are buying.

Mortgages - A mortgage in your own name, highly unlikley with a Thai bank.

However some banks will allow a Thai national to apply for a loan and then the Farang co-signs the loan, evaluation of the loan based on Farangs, salary slips(minimum 12 months slips), letter from the company etc.

Did this a few years for Mrs Soutpeel who was the GF at the time, so being married or not has no bearing on the approval.

This rules seems to change from time to time, when I did this was ok, 6 months later a collegue tried the same thing with the same bank/branch/manager and was told the rules had changed and could no longer do this, but know of cases recently where it has been done with specific banks, so this rule seems to work in cycles

[markinoc]

My Thai lover got a car loan, but I put about 50% down on a two year old car. My lover had no income, but i showed my bank statements and with a wink and a nod, that was it.

An American friend of mine that is fairly well paid by the University in CM was able to get a car loan based on his income also.

[aussiedoug]

If you have a work permit and a sizeable deposit you should be able to get a loan on a condo, 50,000 is plenty of income by Thai standards, I know a lady who earns less than 20,000 and has a loan on a condo at Muang Thong Thani, but is worth less than 500,000.  There is a perception that all farangs are scammers and will run off when they lose their jobs. I have no idea what made thais think people are scammers though, maybe takes one to know one? But are you sure you want to buy?  Renting is cheaper, if you look at the return on capital for renting it is abysmal, and when you want to sell it, it could be difficult. Also the big bugbear of condos is maintenance. They simply don't do it, and you end up living in a shit hole, where the majority of the tenants could care less if the place was filthy dirty.<BR>

[quiksilva]

You should be able to get a car loan if you have been working here for a while but will most likely need a 25-50% down and a guarantor.

Mortgages will be much, much harder though as in order to purchase a condo you need to bring 100% of the cash in from overseas. One possible way to do it is if you already own property overseas, then some firms can help with what is essentially a second mortgage on your existing overseas property.

Another way has also been made known to me recently is where a firm will give you a loan secured by your own capital. The loan amount would be 50% of the sum you that you invest in an offshore tax free bond. The return on your bond must be at least 1.25% so that it repays the interest rates on your loan (which is ~ 2.5%).

By posting this I'm not endorsing either method, just sharing news on the types alternative property financing that are available for expats here (but not from my firm or from me).

Edited July 12, 2010 by quiksilva

[Soutpeel]

My Thai lover got a car loan, but I put about 50% down on a two year old car. My lover had no income, but i showed my bank statements and with a wink and a nod, that was it.

An American friend of mine that is fairly well paid by the University in CM was able to get a car loan based on his income also.

with 50% down, would have less getting a new car...

[djayz]

My gf, who works at a property agent here, told me recently that a bank manager personally called by the office about 1 month ago. He was trying to drum up business and assued the property agents that it would be "much easier" for falang (employed in Thailand) to now obtain a morgage to buy property. Apparently the banks aren't doing as good a business as usual (less falang buying condos/houses due to the debt crisis in the west, strong Baht / weak Euro/GBP/dollar, less tourists, etc.) and are quiet keen on attracting new customers. Maybe your chances of getting a morgage are better now

[Soutpeel]

My gf, who works at a property agent here, told me recently that a bank manager personally called by the office about 1 month ago. He was trying to drum up business and assued the property agents that it would be "much easier" for falang (employed in Thailand) to now obtain a morgage to buy property. Apparently the banks aren't doing as good a business as usual (less falang buying condos/houses due to the debt crisis in the west, strong Baht / weak Euro/GBP/dollar, less tourists, etc.) and are quiet keen on attracting new customers. Maybe your chances of getting a morgage are better now

Think maybe smoke and mirrors being spoken by the Bank manager, as its virtually impossible for a farang to get a mortgage in their own name anyway, condo imay be possible, but in my experience, without Thai national involvement a free standing house is just about not going to happen as farangs are not allowed to own land.

Is this maybe not case of the great Thai tradtion blaming somebody else, preferably Farangs for their own woes ??...just a thought

There would need to be fundamental shift if goverment policies to really change anything, ie allow 1 Rai maximum freehold to persons with a work permit or proper 99 year leases etc etc.....While farangs are not allowed to own land, not much is going to change and debt crisis/exchange rates has very liitle to do with it

[fletchsmile]

For a mortgage on a condo in a foreigners name this can be done via offshore shore banks which have a presence here in Thailand. Standard Chartered and UOB do this with the loan coming from say their Singapore entity, and a charge over the condo taken by their Thai entity. It's done in foreign currency not THB. Because of the complexities and extra admin / legalities involved it's generally only done for larger amounts. In addition there is FX risk for the bank as they loan in say USD/SGD but the charge taken is over the Thai property so THB. The increased costs associated with an offshore mortgage generally result in a more expensive route than an onshore mortgage, although it does have some advantages in other areas. Unfortunately your income level, and hence amount you could borrow is too low.

A second option is a mortgage in a Thai's name guaranteed by you. The Thai is usually your spouse in most cases, and that's the policy most banks follow. Technically it doesn't need to be your spouse and could be another Thai, however in practice it is usually a spouse, as bank's like to see a very close realtionship between mortgagee and guarantor. Not impossible for another relationship, but not very common. One disadvantage for some people is that the name on the condo has to be the same as the name of the borrower => condo in Thai name + mortgage in Thai name + foreigner guarantees. Personally I don't have a big problem with that, and this is the route we took. Unfortunately again your income level may be too low. While for a Thai the minimum monthly salary may be in the ballpark of THB 20k, for a foreigner going this route it is more lik THB 75k.

Edited July 12, 2010 by fletchsmile

[anthony26brit]

Although there are untested work around for land ownership I would not touch them. Condo ownership would be an option but direct finance options I believe have been removed for the present.

Believe some second hand car dealers might offer credit. I know I have acted as guaranteer on Thai car loans without issue at both new and used dealers.

Will move this to proper area.

I was a little vague in my original post. I earn 50,000THB. I am a teacher in Samut Prakan and have been for over a year. I have held a work permit since working here. I just want to see a future if I decide to stay and without a car or buying property it doesnt look too rosy. I am 30 years old for the record.

Thanks for all the replies anyway. All much appreciated.

[aussiebebe]

Although there are untested work around for land ownership I would not touch them. Condo ownership would be an option but direct finance options I believe have been removed for the present.

Believe some second hand car dealers might offer credit. I know I have acted as guaranteer on Thai car loans without issue at both new and used dealers.

Will move this to proper area.

I was a little vague in my original post. I earn 50,000THB. I am a teacher in Samut Prakan and have been for over a year. I have held a work permit since working here. I just want to see a future if I decide to stay and without a car or buying property it doesnt look too rosy. I am 30 years old for the record.

Thanks for all the replies anyway. All much appreciated.

I think you're trying to apply a very British way of thinking to your present situation, which isn't appropriate. Many Germans, for example, rent, whereas Brits love to have debt, I mean a mortgage - they are like badges of honor and considered a sensible use for money, but everything you pay for 15 years on a 30 years mortgage is interest, how sensible is that? A property will be a real millstone if you change your work, and there can't be infinite schools in Samut Prakan. As you are British, you probably view rent as a waste of money, but you should get to know Thailand - property doesn't appreciate as much, Thai's don't like second-hand homes, rent is so much cheaper, as, importantly, are taxis - trust me, your life will, in all probability, be much rosier without mortgage repayments, car loans, maintainance and insurance hanging over you. How many Brits would use taxi's if they were cheaper in the UK? Probably everyone.

In terms of seeing your future here; invest in learning Thai, look at Income tax to minimize your tax liabilities http://www.rd.go.th/publish/6045.0.html, ask your employer if they offer provident funds, and always get health and home insurance policies.

[theoldgit]

Don't know about a mortgage but I had no problem with a car loan. I purchased a new Honda and they organised the finance from Tisco.

As I am retired I don't have a work permit, my income being my pension. I put down a 40% deposit and nobody was asked to co sign.

[trogers]

Is possible if you do not mind buying into a Nirun class of condo, which is a studio unit of about 30m2 costing around Bt320-350k. Locations of Nirun projects near to Samut Prakan would be Nirun inside Sukhumvit 103 or near to Ramkhamhaeng U Bangna campus.

Need your wife to be the buyer and you as guarrantor. Be prepared for a deposit of Bt100k and loan amount of Bt250k.

[trogers]

A condo of higher grade than Nirun suited to your income is Baan Suan Lalana (Suan Luang), a mile further in from Nirun near Ram U Bangna campus.

This would be a 60m2 size condo with 2-bedroom and 1 bathroom. Built in 1994, asking price for an unfurnished unit is around Bt900k.

Estimated cash at Bt300k and loan at Bt600k. Mortgage payment would be around Bt7500/mth on a 10-year loan.

Same conditios - Thai wife as buyer and you as guarantor. Reason being, foreigner buying a condo in their own name must use 100% cash.

[CapTC]

Here's some information

UOB: Only Singapore and Malaysia

Have work permit: 1. Marry with Thai wife, must have marriage certificate 2. Single- must have alien identification card.

SCBT

Have work permit: 1. Marry with Thai wife, must have marriage certificate 2. Single- must have alien identification card 3. Must work in BKK more than 2 y. 4. income more than 100K.

HSBC

no need work permit but you must deposti 3 MB with this bank (not sure)

I think you'd contact them.

[Soutpeel]

Here's some information

UOB: Only Singapore and Malaysia

Have work permit: 1. Marry with Thai wife, must have marriage certificate 2. Single- must have alien identification card.

SCBT

Have work permit: 1. Marry with Thai wife, must have marriage certificate 2. Single- must have alien identification card 3. Must work in BKK more than 2 y. 4. income more than 100K.

HSBC

no need work permit but you must deposti 3 MB with this bank (not sure)

I think you'd contact them.

SCBT ? SCB = live in BKK more than 2 years ?....rubblish

[skybluestu]

Here's some information

UOB: Only Singapore and Malaysia

Have work permit: 1. Marry with Thai wife, must have marriage certificate 2. Single- must have alien identification card.

SCBT

Have work permit: 1. Marry with Thai wife, must have marriage certificate 2. Single- must have alien identification card 3. Must work in BKK more than 2 y. 4. income more than 100K.

HSBC

no need work permit but you must deposti 3 MB with this bank (not sure)

I think you'd contact them.

SCBT ? SCB = live in BKK more than 2 years ?....rubblish

No, not SCB. SCBT are Standard Chartered Bank Thailand and yes, it's true. They, and HSBC, only lend to people buying in BKK and who have lived there for more than 2yrs.

[Soutpeel]

Here's some information

UOB: Only Singapore and Malaysia

Have work permit: 1. Marry with Thai wife, must have marriage certificate 2. Single- must have alien identification card.

SCBT

Have work permit: 1. Marry with Thai wife, must have marriage certificate 2. Single- must have alien identification card 3. Must work in BKK more than 2 y. 4. income more than 100K.

HSBC

no need work permit but you must deposti 3 MB with this bank (not sure)

I think you'd contact them.

SCBT ? SCB = live in BKK more than 2 years ?....rubblish

No, not SCB. SCBT are Standard Chartered Bank Thailand and yes, it's true. They, and HSBC, only lend to people buying in BKK and who have lived there for more than 2yrs.

Ok my mistake..

[ExpatJ]

HSBC thailand will gives foreigners upto 50,000US$ home loan, at least for customers in their 'premier' scheme

[fletchsmile]

Here's some information

UOB: Only Singapore and Malaysia

Have work permit: 1. Marry with Thai wife, must have marriage certificate 2. Single- must have alien identification card.

SCBT

Have work permit: 1. Marry with Thai wife, must have marriage certificate 2. Single- must have alien identification card 3. Must work in BKK more than 2 y. 4. income more than 100K.

HSBC

no need work permit but you must deposti 3 MB with this bank (not sure)

I think you'd contact them.

SCBT ? SCB = live in BKK more than 2 years ?....rubblish

No, not SCB. SCBT are Standard Chartered Bank Thailand and yes, it's true. They, and HSBC, only lend to people buying in BKK and who have lived there for more than 2yrs.

Ok my mistake..

Hehe... TIT everywhere else in the world SCB = Standard Chartered Bank. Here in Thailand, SCB = Siam Commercial Bank, so Standard Chartered use SCBT (T for Thailand).

While these are of the 3 banks that can help foreigners, I'd add the following comments:

UOB: Yes it's largely for Singaporean and Malaysian expats. However, I personally know of a couple of people of different nationaities who obtained an offshore mortgage from them.

Standard Chartered: This is inaccurate in parts. Suggest you visit their branches if interested. Sathorn, Sukhumvit and Silom branches are probably best placed to service foreigners. For Thai spouse, guaranteed by foreigner salary is 75k minimum although is not the only criteria. Properties are allowed in much wider areas than simply Bangkok - eg their offshore mortgages allow Bangkok, Hua Hin, Pattaya and Phuket etc. They usually use a passport and work permit for foreigner identifications. 2 years is not a requirement.

HSBC: The 3mio is the level for premium banking, as it is for most banks offering premium service. It's not a requirement for mortgages. Again suggest to visit their branch for actual facts.

Edited July 20, 2010 by fletchsmile

[Soutpeel]

HSBC thailand will gives foreigners upto 50,000US$ home loan, at least for customers in their 'premier' scheme

So not giving very much away then ? about THB1.6 million, slightly amusing seeing for a HSBC premier account I beleive you need $ 100, 000 deposited with them.

[Furbie]

Although there are untested work around for land ownership I would not touch them. Condo ownership would be an option but direct finance options I believe have been removed for the present.

Believe some second hand car dealers might offer credit. I know I have acted as guaranteer on Thai car loans without issue at both new and used dealers.

Will move this to proper area.

I was a little vague in my original post. I earn 50,000THB. I am a teacher in Samut Prakan and have been for over a year. I have held a work permit since working here. I just want to see a future if I decide to stay and without a car or buying property it doesnt look too rosy. I am 30 years old for the record.

Thanks for all the replies anyway. All much appreciated.

I think you're trying to apply a very British way of thinking to your present situation, which isn't appropriate. Many Germans, for example, rent, whereas Brits love to have debt, I mean a mortgage - they are like badges of honor and considered a sensible use for money, but everything you pay for 15 years on a 30 years mortgage is interest, how sensible is that? A property will be a real millstone if you change your work, and there can't be infinite schools in Samut Prakan. As you are British, you probably view rent as a waste of money, but you should get to know Thailand - property doesn't appreciate as much, Thai's don't like second-hand homes, rent is so much cheaper, as, importantly, are taxis - trust me, your life will, in all probability, be much rosier without mortgage repayments, car loans, maintainance and insurance hanging over you. How many Brits would use taxi's if they were cheaper in the UK? Probably everyone.

In terms of seeing your future here; invest in learning Thai, look at Income tax to minimize your tax liabilities http://www.rd.go.th/...ish/6045.0.html, ask your employer if they offer provident funds, and always get health and home insurance policies.

Of course, the nice thing about owning a place in Thailand is that once you have it, you pay no real property taxes and you no longer have a housing expense - if worth enough, I believe you can even get a visa because of it. Seems worth it to me.

[Soutpeel]

Of course, the nice thing about owning a place in Thailand is that once you have it, you pay no real property taxes and you no longer have a housing expense - if worth enough, I believe you can even get a visa because of it. Seems worth it to me.

and if its house and not a condo, you dont really "own it"...either

On the visa thing, are you talking about buying a condo worth THB 3.0 mil to get the visa ?.....if so that stopped being availible years ago, people who did do it can get their visa's "grandfathered" but no new applications as far as I am aware

[rgs2001uk]

HSBC thailand will gives foreigners upto 50,000US$ home loan, at least for customers in their 'premier' scheme

So not giving very much away then ? about THB1.6 million, slightly amusing seeing for a HSBC premier account I beleive you need $ 100, 000 deposited with them.

Not giving anything away, 3 million baht is required to open a premier account with the HSBC in Bkk.

Bankers logic for you, deposit 3 million to get a loan of 1.6, no such thing as a free lunch.

Furbie said "Of course, the nice thing about owning a place in Thailand is that once you have it, you pay no real property taxes and you no longer have a housing expense"

Missed out the bit about wait until you come to try and sell it, you find out it hasnt risen in value at all and you are stuck with an asset you cant offload.

[Furbie]

Of course, the nice thing about owning a place in Thailand is that once you have it, you pay no real property taxes and you no longer have a housing expense - if worth enough, I believe you can even get a visa because of it. Seems worth it to me.

and if its house and not a condo, you dont really "own it"...either

On the visa thing, are you talking about buying a condo worth THB 3.0 mil to get the visa ?.....if so that stopped being availible years ago, people who did do it can get their visa's "grandfathered" but no new applications as far as I am aware

I was referring to a condo for the most part. Did not know they got rid of the visa for that, but if you put in US $1 million US, cant you get a visa for that? I realize this is beyond most.

[Furbie]

HSBC thailand will gives foreigners upto 50,000US$ home loan, at least for customers in their 'premier' scheme

So not giving very much away then ? about THB1.6 million, slightly amusing seeing for a HSBC premier account I beleive you need $ 100, 000 deposited with them.

Not giving anything away, 3 million baht is required to open a premier account with the HSBC in Bkk.

Bankers logic for you, deposit 3 million to get a loan of 1.6, no such thing as a free lunch.

Furbie said "Of course, the nice thing about owning a place in Thailand is that once you have it, you pay no real property taxes and you no longer have a housing expense"

Missed out the bit about wait until you come to try and sell it, you find out it hasnt risen in value at all and you are stuck with an asset you cant offload.

Why can't you afford it if it's paid for? My point is, once the thing is paid off, aside from maintenance and minimal tax, you essentially live "rent free". For most people, rent is their single biggest monthly expense, if you get rid of this expense, aren't you in a better situation?

I am not a property market expert, but downtown Bangkok seems to go up in value every year. I also have friends who have successfully sold their condo and traded up to bigger ones.

Edited July 21, 2010 by Furbie

[fletchsmile]

Furbie said "Of course, the nice thing about owning a place in Thailand is that once you have it, you pay no real property taxes and you no longer have a housing expense"

Missed out the bit about wait until you come to try and sell it, you find out it hasnt risen in value at all and you are stuck with an asset you cant offload.

I'd agree with Furbie. If you're living here long term it makes sense to buy a home here. Once paid for, one of your biggest monthly expenses is gone. If you're looking for nesting rather than investing then you're not really worried about selling at a profit. What's actually more important is "replacment cost", and the foreign exchange risks.

Every THB 1mio your condo cost 5 years ago would cost you almost 50% more now in GBP terms. 1mio @ 75 baht/pound = GBP 13k 5 years ago. Today 1mio @ 50 baht/pound = 20k. 5 years USD in similar, although has benefited a little in last couple of years from people moved into USD as a "safet haven"

Anyone paying rent has a similar scenario. Even with no rent increases your costs have gone up in USD/GBP

. The general trend of western currencies depreciating will continue given the shift of power form East to West. Sure there'll be fluctuations day to day, and flights to USD from time to time for safety but the mid-long term trend looks clear.

[rgs2001uk]

Furbie said "Of course, the nice thing about owning a place in Thailand is that once you have it, you pay no real property taxes and you no longer have a housing expense"

Missed out the bit about wait until you come to try and sell it, you find out it hasnt risen in value at all and you are stuck with an asset you cant offload.

I'd agree with Furbie. If you're living here long term it makes sense to buy a home here. Once paid for, one of your biggest monthly expenses is gone. If you're looking for nesting rather than investing then you're not really worried about selling at a profit. What's actually more important is "replacment cost", and the foreign exchange risks.

Every THB 1mio your condo cost 5 years ago would cost you almost 50% more now in GBP terms. 1mio @ 75 baht/pound = GBP 13k 5 years ago. Today 1mio @ 50 baht/pound = 20k. 5 years USD in similar, although has benefited a little in last couple of years from people moved into USD as a "safet haven"

Anyone paying rent has a similar scenario. Even with no rent increases your costs have gone up in USD/GBP

. The general trend of western currencies depreciating will continue given the shift of power form East to West. Sure there'll be fluctuations day to day, and flights to USD from time to time for safety but the mid-long term trend looks clear.

Fletchsmile,

not disputing what you say, however we are talking about a guy earning 50k baht a month here.

A guy who doesnt know from one year to the next if he will even have a job, and if he does where he will be located.

I have no idea how much of a mortgage he could get, but one things is for sure, he isnt going to be flipping properties in the CBD.

I also here people going on about the great profits they have achieved on property, when the truth of it is, all they have gained on is the currency exchange rate, and may well in fact have achieved even greater profits by just playing currencies.

This guy is working in the wild west (yes I know its on the east side of the city) of Samut Prakarn, hardly a hot bed for speculators, whats his alternatives? Buying some 800k baht condo and maybe in 5 years time making a profit on it, if at all.

There are whole areas of BKK where these types of property hardly ever increase in value, are bought for cash, lived in for x years and then sold for the same price as they were originally purchased for, the Thai attitude is they lived in them rent free.

The other thing no one mentions, these low cost housing units are always springing up all over Bkk, why should I buy a 5 year old 1 million baht condo when I can buy a new one for the same price.

What happens in say 3 years down the road, the op is stuck with a property in say Bang Na and is paying x baht per month on a motgage, his job is terminated and he secures employment in say Bang Saen, he now has to try and sell his original condo, in the meantime he is now paying y baht per month on a rental, hardly a situation I would like to be in on 50k a month.

The above of course is nothing but idle speculation on my part, however as America and Europe are now realizing to their cost, home ownership isnt for everyone, there will always be those for whom it will be nothing more than a dream, always beyond their reach.

The best investment the op could make, assuming he is a "proper" teacher would be to secure employment in say a military school in Brunei, or Saudi and earn say £50k a year tax free, do that for a few years and set himself up, then come over here and play at being a teacher.

Never ceases to amaze me guys with qualificactions and a western education wasting their lives for in Thailand for £1,000 a month. By the time it dawns on them, its too late to rectify the situation.

In fact, rereading the op's "

I was a little vague in my original post. I earn 50,000THB. I am a teacher in Samut Prakan and have been for over a year. I have held a work permit since working here. I just want to see a future if I decide to stay and without a car or buying property it doesnt look too rosy. I am 30 years old for the record."

It may well be the op has already sussed out things aint to rosy in the garden of Ye Olde Siam, 50k a month, buy a car and a condo, no mention of family yet, God knows what his pension fund looks like or what his retirement plans are, the naivety of youth, hope things work out for him, as I mentioned before, in his shoes with no ties (Thais?) here his future may well lie elsewhere.

Furbie, in reply to, "I was referring to a condo for the most part. Did not know they got rid of the visa for that, but if you put in US $1 million US, cant you get a visa for that?"

No you cant get a visa for that either.