Wife Can Borrow Only 50% Because Married To Farang?

[blakegeee]

My Thai wife and I are "trying" to have a small house built by a developer (Somwang) here in Chiang Mai. Of course it will be in my wifes name. The total cost of the house/land is 1,500,000 and we are prepared to pay 20% and finance 80%. This will still leave us about 200K for upgrades, furnishings etc. We currently have about 500K in her Siam Commercial bank account at the moment and she always uses that account to run money. So the builder submitted the financing application papers to Siam commercial as they know the manager and said that we have a better chance of getting the loan if they do it for us. We previously visited Kasikorn, Siam Comm and the builder and they all agreed that the financing should be no problem at all.

Anyways, the builder just called back saying that since my wife is married to a Farang, the bank will only finance 50%. Has anybody ever heard of this, and do you know any way around it? Basically the house is worth 1,500,000 and we have about 500K but we need to save some for upgrades and furnishing.

We will submit an application to Kasikorn on Monday but I am wondering if its going to be the same story everywhere? Thanks for any info.

[Soutpeel]

Not true...my GF (who is now the wife) got a 100% loan on a property of THB 4.0 mil with me as co-signatory and she wasnt even working at the time, they considered my salary only, with her name on the mortage...this was through SCB

[blakegeee]

Not true...my GF (who is now the wife) got a 100% loan on a property of THB 4.0 mil with me as co-signatory and she wasnt even working at the time, they considered my salary only, with her name on the mortage...this was through SCB

But was she your GF or wife at the time? I didn't think farang could co-sign with a salary from overseas. Or is it a salary from here? I have my own company in Canada getting paid online directly from customers so its a little difficult to show my unsteady income anyways.

[slapout]

The builder just gave a indication of the system as utilized for self benefit at times here. The valuation by the bank would have to be from plans in the op's case and that is hard for the banks to do. Married to a farang did not enter into the down payment to the banks, my wife has used. If construction is complete the bank will send people to site to determine what the loan amount will be, thus they tell you the value of the house . Virtually all of the new builds where farang were involved, that I am acquainted with were paid for by the stage of construction with no bank financing. One fellow had some large cost overrun and borrowed the last payment due the builder, from the bank. He had a structure for them to look at and he was only in need of about 20% of total cost.

If your wife does not have a job with verifiable monthly income nor do you the bank will be hard pressed to determine what you are capable of repaying each month thus a higher up front payment will be required. I cosigned a loan on a property my wife purchased using foreign income as proof of monthly income. Wife does not receive a monthly salary so mine was used.

[blakegeee]

Sorry, I guess I need to clarify a few things. The house has not yet been built. Once the bank approves the financing, I imagine the builder will want our 20% down (or at least some of it I'm sure), and then the builder will begin construction. When the house is complete, the bank will pay the builder the other 80%. This home is part of a development by the company "Somwang" who is doing several moo baans around Chiang Mai. They seem to have arrangements with SCB as they know the manager there.

My wife owns a small business and has shown her income statements and "money running" in the bank as they say.

[kurnell]

Me and the missus got 110% loan from UOB, value nearly 6 million.

[Soutpeel]

Not true...my GF (who is now the wife) got a 100% loan on a property of THB 4.0 mil with me as co-signatory and she wasnt even working at the time, they considered my salary only, with her name on the mortage...this was through SCB

But was she your GF or wife at the time? I didn't think farang could co-sign with a salary from overseas. Or is it a salary from here? I have my own company in Canada getting paid online directly from customers so its a little difficult to show my unsteady income anyways.

The GF at the time, and I work in Thailand.

[dave111223]

My wife got an 80% loan from Krung Thai.

SCB sucks for mortgages. We had several million in cash with them and had been using them for years, when it came time to get a mortgage we figure SCB would be a sure thing...WRONG! They basically told us that being customers for years and have large balances counted for sh*t and they were only interested in current salary.

They would only give us max 70% with a mortgage length of 5 years (5 years for a mortgage?? LOL) and the interest rate was something ridiculous (more like a credit card rate).

Every other bank we went to were more helpful (Krung Thai, Bangkok Bank, Kasikorn, Krung Sri).

We didn't even have an account with Krung Thai.

Try another bank.

[gregb]

The "married to a farang" part has nothing to do with it. The bank simply doesn't want to do the loan for whatever reason. They could just as easily have said we only want to give you 50% because you have bad breath.

You need to tell the builder to find another bank, or find one on your own, or forget the whole thing and find a different house with a different builder. Every bank with the exception of Government Housing Bank will have no problem underwriting a mortgage with between 10% - 30% down if you have sufficient verifiable income and credit history.

GHB will not loan to a Thai married to a foreigner because the repayment of the loan would be from "sin somros" funds, and therefore you can not legally sign the document that says the funds used were "sin suan tua" of the wife without committing fraud. Every other bank simply ignores this small detail.

[slapout]

Wife was told that as she was over 45 years of age when she applied for loan that the loan length could not be for more than 5 years. Bank policy. I laughed when I heard this, no physical was required, no questions about lifestyle, etc The Thai banks personnel can come up with some real chuckles, whether true or not, who knows. Probably another way to show someone has a little authority.

[Soutpeel]

Wife was told that as she was over 45 years of age when she applied for loan that the loan length could not be for more than 5 years. Bank policy. I laughed when I heard this, no physical was required, no questions about lifestyle, etc The Thai banks personnel can come up with some real chuckles, whether true or not, who knows. Probably another way to show someone has a little authority.

Think they make it up as they go along, Mrs Soutpeel was offered 5 yrs, 10 yrs or 15yrs, with sitpulation that she couldnt repay the loan in 3 years or less without being hit with significant "cancellation fees"

[jfchandler]

Every bank with the exception of Government Housing Bank will have no problem underwriting a mortgage with between 10% - 30% down if you have sufficient verifiable income and credit history.

GHB will not loan to a Thai married to a foreigner because the repayment of the loan would be from "sin somros" funds, and therefore you can not legally sign the document that says the funds used were "sin suan tua" of the wife without committing fraud. Every other bank simply ignores this small detail.

Not sure about your reference to Government Housing Bank... The bank's web site has a press release announcement from earlier in the year (September 2010) that appears to say just the opposite...

http://www.ghbank.co.th/en/News/files/20100907/index.html

[scorecard]

Me and the missus got 110% loan from UOB, value nearly 6 million.

About four years back my Thai adult son, at the time an extended university student with no income got a substantial loan (100% of the cost of land, the house and extra for built-in furniture etc) from UOB with me as guarantor (me working in Thailand).

I can recall that our UOB manager, who worked previously for Kasikorn Bank, as a branch manager, shared that there are rules issued by the Bank of Thailand, Thai banks issue their own additional rules, and branch managers sometimes add own additional rules and are allowed to do so by their various head offices.

He also shared that UOB (Singaporean bank) do have a different appraoch. K bank, BBL etc., have a list of specific requirements and if you don't get a tick for every requirement then your application fails with further discussion not allowed, whereas UOB looks broadly at all the factors and make a decison on the broad picture.

The OP shared that the developer has played a role in presenting the loan applications to various banks, and each time it has been unsuccessful.

Obviously I don't have any further details but I wonder if the builder is asking the bank for a commission and it's not forthcoming, therefore the builder is trying further banks etc., still aiming to get a kick back.

[kurnell]

Me and the missus got 110% loan from UOB, value nearly 6 million.

About four years back my Thai adult son, at the time an extended university student with no income got a substantial loan (100% of the cost of land, the house and extra for built-in furniture etc) from UOB with me as guarantor (me working in Thailand).

I can recall that our UOB manager, who worked previously for Kasikorn Bank, as a branch manager, shared that there are rules issued by the Bank of Thailand, Thai banks issue their own additional rules, and branch managers sometimes add own additional rules and are allowed to do so by their various head offices.

He also shared that UOB (Singaporean bank) do have a different appraoch. K bank, BBL etc., have a list of specific requirements and if you don't get a tick for every requirement then your application fails with further discussion not allowed, whereas UOB looks broadly at all the factors and make a decison on the broad picture.

The OP shared that the developer has played a role in presenting the loan applications to various banks, and each time it has been unsuccessful.

Obviously I don't have any further details but I wonder if the builder is asking the bank for a commission and it's not forthcoming, therefore the builder is trying further banks etc., still aiming to get a kick back.

UOB service is crap, but they do lend where others won't. we also asked for an received a significant discount on our interest rate after 3 years.

[thaisail]

I found a way to get around the 50% issue. I work overseas and I send $1000 per month to my wife's US bank account. She then withdraws the cash from the ATM at Siam Commercial and deposits that money in her bank account every month. She can then use that money each month to pay her bills. We have been doing this for three years and requesting credit for buying a new car. At first it was 50% only but just last week we walked in to our branch in Chalong and we were told that we now qualify for 20% only because of the regular deposits over the last 3 years. Our bank balance went slowly up to 200K and is now down to 20K and yet we were assured that we can now buy a new car financed at 20% down payment with a 5 year loan. We haven't looked for land or house yet with financing so I don't know if the situation is different. In Phuket the land is too expensive and we now live in a brand new unfurnished house for 11K per month and that is the best we can do in the Phuket area.

[manhattan55]

Every bank with the exception of Government Housing Bank will have no problem underwriting a mortgage with between 10% - 30% down if you have sufficient verifiable income and credit history.

GHB will not loan to a Thai married to a foreigner because the repayment of the loan would be from "sin somros" funds, and therefore you can not legally sign the document that says the funds used were "sin suan tua" of the wife without committing fraud. Every other bank simply ignores this small detail.

Not sure about your reference to Government Housing Bank... The bank's web site has a press release announcement from earlier in the year (September 2010) that appears to say just the opposite...

http://www.ghbank.co...0907/index.html

Not necessarily. When you click all the way through to the application form the Thai applicant has to state his/her marital status. Having a non-Thai spouse may therefore disqualify the loan applicant. I understand jfchandler's comment to mean (and I would agree with that): why target a loan program to a defined number of potential customers (Thai nationals living abroad) when the Bank's lending policies would most certainly severally restrict the available pool of potential customers (I am assuming that a large number of Thai nationals living abroad are married to non-Thais - but I stand to be corrected).

[DougLee]

I found a way to get around the 50% issue. I work overseas and I send $1000 per month to my wife's US bank account. She then withdraws the cash from the ATM at Siam Commercial and deposits that money in her bank account every month. She can then use that money each month to pay her bills. We have been doing this for three years and requesting credit for buying a new car. At first it was 50% only but just last week we walked in to our branch in Chalong and we were told that we now qualify for 20% only because of the regular deposits over the last 3 years. Our bank balance went slowly up to 200K and is now down to 20K and yet we were assured that we can now buy a new car financed at 20% down payment with a 5 year loan. We haven't looked for land or house yet with financing so I don't know if the situation is different. In Phuket the land is too expensive and we now live in a brand new unfurnished house for 11K per month and that is the best we can do in the Phuket area.

I have been doing that on top of a business and for 100k per month and financing a 3mil house is a pain in the ass.. i can afford bigger and can't get a loan as you can only apply once per year as i am told.

dont get your hopes up

[blakegeee]

Me and the missus got 110% loan from UOB, value nearly 6 million.

About four years back my Thai adult son, at the time an extended university student with no income got a substantial loan (100% of the cost of land, the house and extra for built-in furniture etc) from UOB with me as guarantor (me working in Thailand).

I can recall that our UOB manager, who worked previously for Kasikorn Bank, as a branch manager, shared that there are rules issued by the Bank of Thailand, Thai banks issue their own additional rules, and branch managers sometimes add own additional rules and are allowed to do so by their various head offices.

He also shared that UOB (Singaporean bank) do have a different appraoch. K bank, BBL etc., have a list of specific requirements and if you don't get a tick for every requirement then your application fails with further discussion not allowed, whereas UOB looks broadly at all the factors and make a decison on the broad picture.

The OP shared that the developer has played a role in presenting the loan applications to various banks, and each time it has been unsuccessful.

Obviously I don't have any further details but I wonder if the builder is asking the bank for a commission and it's not forthcoming, therefore the builder is trying further banks etc., still aiming to get a kick back.

OP here: The builder actually only has a "connection" with SCB and thats the only one that they have applied to. We told them to send our papers to Kasikorn but they said that they only deal with SCB so we have to apply at the other banks ourselves.

Our friends who also just bought a house made a good point. They asked if we showed that we own a 400K+ baht truck (paid off) and over 250K baht in motorbikes (imported and Thai) all with greenbooks. We hadn't shown this as it never occurred to us and it just never came up.

It sounds like SCB is difficult as people mentioned above and other Thais have also told my wife. Not sure if we will bother going back to show them the additional information about our assets (vehicles) but on Monday we will definitely go see other banks, such as Kasikorn and possibly UOB. Somebody mentioned that the UOB service is bad, although the got a discount on the interest after 3 years??? Does anybody else have anything bad/good to say about them? It sounds like several people have found them to be the easiest to get a loan from.

Thanks for all the replies and info!

[jfchandler]

Manhattan, I don't understand your post below, since you seem to be talking about the bank's policy regarding Thais living abroad.

That's not what the issue is about: it's about whether Government Housing Bank will lend to Thais living in Thailand (for property located in Thailand) who happen to be married to farangs.

I, and my Thai wife, have never applied to GHB for a home loan, so I can't speak from personal experience.

But their web site news release pretty clearly says they are willing, at least as a matter of policy, to make home loans to Thais who are married to farangs in Thailand.

Not necessarily. When you click all the way through to the application form the Thai applicant has to state his/her marital status. Having a non-Thai spouse may therefore disqualify the loan applicant. I understand jfchandler's comment to mean (and I would agree with that): why target a loan program to a defined number of potential customers (Thai nationals living abroad) when the Bank's lending policies would most certainly severally restrict the available pool of potential customers (I am assuming that a large number of Thai nationals living abroad are married to non-Thais - but I stand to be corrected).

[manhattan55]

Manhattan, I don't understand your post below, since you seem to be talking about the bank's policy regarding Thais living abroad.

That's not what the issue is about: it's about whether Government Housing Bank will lend to Thais living in Thailand (for property located in Thailand) who happen to be married to farangs.

I, and my Thai wife, have never applied to GHB for a home loan, so I can't speak from personal experience.

But their web site news release pretty clearly says they are willing, at least as a matter of policy, to make home loans to Thais who are married to farangs in Thailand.

Not necessarily. When you click all the way through to the application form the Thai applicant has to state his/her marital status. Having a non-Thai spouse may therefore disqualify the loan applicant. I understand jfchandler's comment to mean (and I would agree with that): why target a loan program to a defined number of potential customers (Thai nationals living abroad) when the Bank's lending policies would most certainly severally restrict the available pool of potential customers (I am assuming that a large number of Thai nationals living abroad are married to non-Thais - but I stand to be corrected).

I am sorry, let me clarify: the GHB news release which you quote contains a link

which leads you to another news release that specifically discusses the bank's lending to Thai nationals living abroad. At least that's what I

see when I click on the link. I hope my browser is not playing any tricks on me

[jfchandler]

Manhattan, you're right... I hadn't followed that link before in the news release, since it was just labeled as going to GHB's home page...

But it actually leads to the page you described...which is entirely related to a program for Thais living outside Thailand... Weird.... Thanks.

[scorecard]

Me and the missus got 110% loan from UOB, value nearly 6 million.

About four years back my Thai adult son, at the time an extended university student with no income got a substantial loan (100% of the cost of land, the house and extra for built-in furniture etc) from UOB with me as guarantor (me working in Thailand).

I can recall that our UOB manager, who worked previously for Kasikorn Bank, as a branch manager, shared that there are rules issued by the Bank of Thailand, Thai banks issue their own additional rules, and branch managers sometimes add own additional rules and are allowed to do so by their various head offices.

He also shared that UOB (Singaporean bank) do have a different appraoch. K bank, BBL etc., have a list of specific requirements and if you don't get a tick for every requirement then your application fails with further discussion not allowed, whereas UOB looks broadly at all the factors and make a decison on the broad picture.

The OP shared that the developer has played a role in presenting the loan applications to various banks, and each time it has been unsuccessful.

Obviously I don't have any further details but I wonder if the builder is asking the bank for a commission and it's not forthcoming, therefore the builder is trying further banks etc., still aiming to get a kick back.

OP here: The builder actually only has a "connection" with SCB and thats the only one that they have applied to. We told them to send our papers to Kasikorn but they said that they only deal with SCB so we have to apply at the other banks ourselves.

Our friends who also just bought a house made a good point. They asked if we showed that we own a 400K+ baht truck (paid off) and over 250K baht in motorbikes (imported and Thai) all with greenbooks. We hadn't shown this as it never occurred to us and it just never came up.

It sounds like SCB is difficult as people mentioned above and other Thais have also told my wife. Not sure if we will bother going back to show them the additional information about our assets (vehicles) but on Monday we will definitely go see other banks, such as Kasikorn and possibly UOB. Somebody mentioned that the UOB service is bad, although the got a discount on the interest after 3 years??? Does anybody else have anything bad/good to say about them? It sounds like several people have found them to be the easiest to get a loan from.

Thanks for all the replies and info!

Dear OP,

One member, as you can see, said UOB service is crap, but I suggest that's specific to the branch and the same comment would apply to any bank.

Our experience with UOB (5 different branches)

- Bkk - 2 branches, Chonburi City - 1, Chiang Mai 1 --- all branches very customer focudes, all managers very 'can do' / 'how can we make this work' attitude, all good listeners, all except Chonburi city speak good English.

Six months back my Thai son and I opened a joint account with the UOB Chiang Mai branch at Don Chan, because we are in process of building a new house nearby. Young staff member who opened the account was focused, good listener, gave clear answers, good English, and in fact we deposited just 1,000Baht to get the account opened. Within one hour the manager called my son and politely said, "I understand your moving to CM, if there is anything UOB can help with, please give me a call". In my experience not your usual Thai bank approach.

- Pattaya - 1 branch, until recently dreadful service, but recently got a new manager, just out of UOB manager / customer service school, service has changed to excellent.

Good luck and hang in there, it's worth the bumps to get your family into good housing.

[blakegeee]

OP:

So we have now applied for financing to both Kasikorn and UOB and are awaiting reply although its only been a couple days so far. Today we went to Bangkok Bank where the manager is a friend of an acquaintance, so hopefully that will help. The weird part was that Bangkok Bank requires 2500 baht to begin the application process. This fee is not refundable whether they approve the loan or not. They claim that it covers the cost of visiting the building site, visiting the wifes business, and checking the land value with the gov't etc. They also claim that all banks charge this fee, although so far no other bank has asked yet. Maybe Kasikorn and UOB will ask for this fee once they get to the next step, or is Bangkok Bank actually the only one charging this? They are also the only one requesting my passport. We need to bring back my passport and one more document "any time" so we can pay the fee to get it rolling at that point. So has anyone else paid this to any banks?

[blakegeee]

I don't believe there is any such law...if there ever was one it has probably been changed now. There was a time when Thais married to foriegners were prohibited from owning property...but that is over now. The law has been changed for about 20 years I believe. Some Thais still think it is in effect.

I think the bank is stalling you because financing 80% of the house cost is not attractive to them. They may not be certain your income is high enough to cover that amount or are worried about you defaulting on the loan. So they are trying to save face with a phoney "law" to avoid telling you the truth...that they don't want to make the loan to you.

If you can see your way to a shorter loan repayment period, or get more money or colatteral for the loan, he bank might agree. If you could come up with a bigger down payment, the bank might change it's mind. Likewise if the repayment time was shorter.

Also, if one bank says no, keep trying. Maybe another will say yes.

Ya, I think you are right. Funny that they didn't even ask about further assets like the vehicles we own, etc. Our truck is worth more than the 20% down. Anyways, we have moved on to other banks and they have confirmed that they can lend 80% if everything looks good. They also accepted the truck documentation as well. Bangkok Bank says that we should have an answer within 1 week and she says that she thinks that we should be able to get it easily. We'll see though. I think the biggest strike against us is that the wife has never borrowed money before. She hasn't even had a credit card for a year, and she always bought her motorbikes cash after she saved money, and we bought the truck cash, etc. I think that the income and assets are alright but she just doesn't have any credit history.

[dave111223]

OP:

So we have now applied for financing to both Kasikorn and UOB and are awaiting reply although its only been a couple days so far. Today we went to Bangkok Bank where the manager is a friend of an acquaintance, so hopefully that will help. The weird part was that Bangkok Bank requires 2500 baht to begin the application process. This fee is not refundable whether they approve the loan or not. They claim that it covers the cost of visiting the building site, visiting the wifes business, and checking the land value with the gov't etc. They also claim that all banks charge this fee, although so far no other bank has asked yet. Maybe Kasikorn and UOB will ask for this fee once they get to the next step, or is Bangkok Bank actually the only one charging this? They are also the only one requesting my passport. We need to bring back my passport and one more document "any time" so we can pay the fee to get it rolling at that point. So has anyone else paid this to any banks?

I also had to pay this fee when applying at Bangkok Bank upfront. Other banks do charge valuation fees (for the guys who come to survey the property), but the other banks review your case and setup survey before charging the fee. Also i had to give passport at Bangkok Bank (although i was not a co-signer on the loan).

It's also not uncommon to pay the surveyors a "bung" to make sure they value the property "fairly", it cost us a few pairs of football boots to insure the valuation was higher than the actual purchase price.

[bkk_mike]

Wife got just under 80% loan from UOB based solely on my income from abroad... (i.e. with me as guarantor)

Things in our favour that might be the issue for you.

- Wife has a good credit history as we've bought other property, cars etc. over the years. Although we did have issues with the % we could borrow just after we were married... (That house is now paid off).

- I am employed by a really big company that the bank staff had heard of.

- We were borrowing a low multiple of salary (less than 1x yearly income).

But we still got a lower percentage of the total cost than my wife's Thai friends who bought in the same development around the same time.

[jonnyscot]

Hi Blakegeee,, wondering whether your wife has taken your surname or kept her thai surname name,,,, reason I'm asking is that the wife applied for 80% and she was told at the (SCB) branch after checking over the financial details there should be no probs with the application,,, when filling in form lady noted that the wife had a non Thai surname, she decided to call their provincial head office for some clarification, she came back and informed the wife that they would only offer 50% of the value because she had non Thai Surname..,,,

[blakegeee]

Hi Blakegeee,, wondering whether your wife has taken your surname or kept her thai surname name,,,, reason I'm asking is that the wife applied for 80% and she was told at the (SCB) branch after checking over the financial details there should be no probs with the application,,, when filling in form lady noted that the wife had a non Thai surname, she decided to call their provincial head office for some clarification, she came back and informed the wife that they would only offer 50% of the value because she had non Thai Surname..,,,

Thats right, my wife also has a "non-Thai" surname. As somebody else said, this whole system seems to be subject to interpretation at several severals so every bank branch and company handles things differently.

At the moment, some of the banks are saying that they want to see the house finished before they will decide if they'll give more than 50%. Being with a fairly well-known builder (Somwang), I didn't expect this to be the case though. We are thinking about paying our portion of the money to get the house build. The builder will expect the rest when the house is finished, obviously before we can move in. Hopefully by the time it is finished, the financing will all be straightened out. Just seems like such a backwards way of doing it. If worst came to worst, and we didn't get the financing here, I "could" put it on a line of credit back home but it just isn't convenient although the interest rates are better!

[blakegeee]

We just got a loan from BKK Bank and they gave us 75% of the value of the property, telling my wife that we should be happy as they normally only give 50% if married to a Farung. I am a co-signer on the loan. Just as well, means less money we have to pay interest on.....

And I am assuming that your wife also has your surname? Bangkok Bank is looking like our best bet at the moment. We are still waiting to hear back from them after the Big Bangkok bank in Bangkok approves it... How long did that step take you? For us, they said it would take a week but that was apparently just for the Chiang Mai office to get everything sorted. After that, they said it will be about a month for the big one in Bangkok to approve it.

[Amir]

For SCB, it's correct if you buy land and then build a house seperatly. Apparently you plan to buy land and use a contractor to build the house that is originaly not on the land yet. In other words, you seem not to purchase land + house from the same person. If this is correct, SCB will give only 50% loan if mixed couple. If the project is "one" land + house from same contractor, then you can get up to 80% (and not only 70% as some would say).

I was faced to the same issue a few weeks ago.

Hope this can help.