Fraud, Corruption Or Just Thai Legal Bank Theft?

[newsite12]

Here is the deal.

My girlfriend's ex has fallen on stoney times (alledgedly) and can no longer afford to pay the mortgage on his house. He lives around the corner from her. he is not a very popular chap after some nasty things he did not only to my gf, but also to her family.

Here is the current setup.. tell me if you smell the rat that I do.

Her family are actually very financially comfortable. and her sister lives next door to the ex. Her ex owned his own business that paid him around 30K a month, until about 2 months ago, where he sold it for an undisclosed amount. he then stopped paying the mortgage as he claimed that it was too expensive and he now has no income.

He has now dumped his girlfriend of the past 2 years who lived with him, and now is pleeding poverty and that he has lost 'everything'.... oh dear, what a shame!.

Anyway... He has known for a few months that my gf's dad wants to buy the house if he ever leaves it, this is because he want to join the 2 together for his sister and her family (which is expanding). This has triggered the moans and wails of 'oh what am I to do'.. I have lost everything...boo hoo!

The finances.

He bought the house 7 years ago for 800,000 baht.

He paid 200,000 deposit, leaving a mortgaged balance of 600,000.

He has (up till 3 months ago) paid 7000 a month in repayments, of which the majority is interest.

The mortgage term was 30 years.

My gf believes that the interest rate at the time was around 6.5%

Firstly... the repayments do not correspond with the above figures. No way would 7000 a month be the repayment amount.

Secondly, my gf's dad went to the bank this morning with an offer to clear the outstanding and claim ownership of the house, which will keep my gf's ex in the clear with regard to credit score. The bank have said that the balance to be cleared is 800,000 baht!!!

He is ready to pay it... I have said.. wait. Don't pay yet.... something is very fishy about this whole setup. The figures do NOT add up, the balance is way over quoted even if he has missed 3 months payments. how can the bank be asking for 200K more than the original loan even though he has already made 560,000 baht in payments over the 7 years. Surely the principle must be around 500K to 550K??

Everyone is ready to trust this guy who has managed to shaft a few people in the past... why sell his business, dump his gf, stop paying the mortgage?

I know what i suspect... i think he has taken a remortgage out on the house after the flood and hearing of my gf's dad's interest in acquiring it. The sold the business, stopped paying, and then her dad will bail him out just to get the house while doing him a favour... yes.... her dad is a very very kind man, and he regularly gets taken advantage of.

However.. i am not prepaired to sit back and just let this guy shaft my future father in law. If that is indeed the case.

I am not sure how it works here with the banks, i realise this is a different place to the UK, but surely late payment penalties and early redemption penalties can not be this harse.

If anyone here knows the setup... would appreciate your thoughts. i want to recommend an independent valuation and half hour with a financial advisor.

[Soutpeel]

Why dont you ask the bank for the break down....

[newsite12]

Why dont you ask the bank for the break down....

That is one of the questions i will raise tonight at dinner. Just wanted to get a bit of feedback from the forum. There may be confidentiality issues as her dad is not the original cistomer... but i think it would at least be prudent if this is the case to insist the ex gets this info and forwards it. But he has actually waited till he has to be out in days... i think he has deliberately put time pressure into the mix so that this gets rushed trough.

Call me over-suspicious, but i don't trust anything about this.

[needforspeed]

Why would 7000 B never been the repayment amount.

Just use a calculator and Yes this is correct, 7000 B a month its more then enought to pay 600k within 30 years.

As other post told you already ask for the banks breakdown.

Good luck

NFS

[BuckarooBanzai]

Putting aside the houses history, the mortgage, payments etc. if the house is worth 800,000 baht why would anyone expect to pay less to purchase it?

Edited March 7, 2011 by BuckarooBanzai

[Darrel]

Call me over-suspicious, but i don't trust anything about this.

Call me old-fashioned but I think that when you are in a third-world country (or even at home these days, for that matter) you should be suspicious of any financial dealing involving more than the cost of a modest meal. I know I do and so far I am satisfied with my judgment.

[newsite12]

Why would 7000 B never been the repayment amount.

Just use a calculator and Yes this is correct, 7000 B a month its more then enought to pay 600k within 30 years.

As other post told you already ask for the banks breakdown.

Good luck

NFS

Yes I did use one... the repayments should be 3828.87 baht a month based on the info I had.

Seems to me that 7000 a month suggests a remortgage that has not been mentioned... I am just wondering that if this is the case... How recent was this loan taken out?.. that is why this has SCAM stamped all over it.

[jdinasia]

I would suggest that

1) The bank has not foreclosed yet -- so must buy the owner out

2) You don't have enough information to label it a scam.

[Soutpeel]

Yes I did use one... the repayments should be 3828.87 baht a month based on the info I had.

Seems to me that 7000 a month suggests a remortgage that has not been mentioned... I am just wondering that if this is the case... How recent was this loan taken out?.. that is why this has SCAM stamped all over it.

If the property has been remortaged...its hardly a scam, certainly not fraud, corruption or theft as the title of your post suggests...

As with all business dealings not just in Thailand....do your due dilligence before parting with any cash and as always buyer beware

If FIL is going to buy the property his is allowed to talk to the bank to find out exaclty what is owed and one would assume he will be paying the bank concerned directly to settle this loan

[newsite12]

Yes I did use one... the repayments should be 3828.87 baht a month based on the info I had.

Seems to me that 7000 a month suggests a remortgage that has not been mentioned... I am just wondering that if this is the case... How recent was this loan taken out?.. that is why this has SCAM stamped all over it.

If the property has been remortaged...its hardly a scam, certainly not fraud, corruption or theft as the title of your post suggests...

As with all business dealings not just in Thailand....do your due dilligence before parting with any cash and as always buyer beware

If FIL is going to buy the property his is allowed to talk to the bank to find out exaclty what is owed and one would assume he will be paying the bank concerned directly to settle this loan

In my book.... remortgaging a property that you have no intention in keeping up the repayments is a SCAM.

If FIL had nointerest in the property. It would not be worth 800K. As a matter of fact, if it were not for wanting to conjoin the 2 houes, this property would be a white elephant to try to sell. there is noway the ex will walk away from this with his credit score intact. This house was under 4 foot of water, and if it happens again as it seems to be with the UK, then both houses will be as good as worthless.

FIL is taking a risk as it is. Houses are already difficult to sell in Thailand, with all the new houses being built. people like to buy new.

I forgot to mention.... FIL paid the 200K deposit that the ex never repaid.

By the way.... If I wrote this topic in 2 months time, and explain the situation, i think most replies would be... how stupid... why didn't you tell your father in law.... of course it was a scam... are you blind???... uyour sooo dumb.... welcome to Thailand....lol.... newbie newbie!!!...

But in reflection to the advice so far, i will go now and advise him to get pro-advice.. I will not mention my suspicians. I don't want to rock any boats... Like most have said... probably not a scam, probably straight up... I will write an update in 2 months.

Edited March 7, 2011 by newsite12

[needforspeed]

Why would 7000 B never been the repayment amount.

Just use a calculator and Yes this is correct, 7000 B a month its more then enought to pay 600k within 30 years.

As other post told you already ask for the banks breakdown.

Good luck

NFS

Yes I did use one... the repayments should be 3828.87 baht a month based on the info I had.

Seems to me that 7000 a month suggests a remortgage that has not been mentioned... I am just wondering that if this is the case... How recent was this loan taken out?.. that is why this has SCAM stamped all over it.

Nothing to do with a scam, just remortgage for 800k.

I would not be so worried, if the value of the house the same or more then what you need to pay to the bank, and you like the house, every one happy.

Cheers,

NFS

[SGD]

At 6.5% on 600k over 30 years the repayment should be 3792 baht per month. However, Thai lenders often put up compulsory insurances and other such nonsense and these seem to be routinely bought by the uneducated mortgage applicants. Not that this would near double the repayment though.

800k at the same rate over 30 years would be 5057 baht per month. 7000 baht per month would pay off a a million baht advance at 6.5% over the remaining 23 years. If 800k is the amount owing and the repayment is 7000 baht, then at 6.5% the term of the loan is around 15 years.

[gregb]

At 6.5% on 600k over 30 years the repayment should be 3792 baht per month. However, Thai lenders often put up compulsory insurances and other such nonsense and these seem to be routinely bought by the uneducated mortgage applicants. Not that this would near double the repayment though.

800k at the same rate over 30 years would be 5057 baht per month. 7000 baht per month would pay off a a million baht advance at 6.5% over the remaining 23 years. If 800k is the amount owing and the repayment is 7000 baht, then at 6.5% the term of the loan is around 15 years.

Due to the adjustable rate nature of mortgages in Thailand, a 30 year mortgage is usually assigned a payment that would repay in only 20 years if the interest rate doesn't change. This way, if the rate goes up, the bank simply extends the payment terms beyond 20 years, rather than increasing the payment amount.

7000 baht sounds about right for a total original loan amount of 800k - 900k. Of course, I don't know what the interest rate was 7 years ago, so it is impossible to say anything more precise than that. It was probably substantially higher than today's rate of 6.5%.

The numbers don't sound so outrageous that there could not be a reasonable explanation. Maybe a second loan was acquired at some point. As others have said, just ask the bank for the particulars. I'm sure they will be able to clear up any questions you have.

[lovelomsak]

I would suggest just mind your own business. What does all this have to do with you. You donot know what is going on so stay out of it. Or are you interested in getting a free house to live in paid for by someone else. If the girlfriends family has money they didnot get it in this country by being stupid. They should have a better idea whats going on then a foreigner. Just my humble opinion.

[GM1955]

l'd suggest that you do exactly what Thai Visa members tell you to do.

[newsite12]

Thanks for your opinions... I was right. it all came out in the conversation.. the guy has remortgaged and got 300K in his pocket then sold this dodgy house to FIL.... But he dosn't seem to care about it.

Regarding Lovelosmack's arrogant accuations... I actually own my own house here. i had no help.. and it is worth a dam_n site more than 800K.

I have my own company here and i probably make more money in a day than you make a month..

So i suggest YOU mind your own busiuness.

Admin, Mods... please close the thread... it is now invalid.

[CanInBKK]

Haven't done the math, but if the property has missed 3 payments it's an NPL, as such the mortgage rate would go from 6.5% to the legal maximum (18+% if I'm not mistaken). But none of this matters anyways as there are so many factors to take into account that the only reasonable answer is to get the details.

[craigt3365]

Seems the OP has gotten the info he has requested. So we will close this thread, per OP's request. We can always open it again if needed!!!