We purchased a house in Chiang Mai nearly 6 years ago with the help of a mortgage from the Siam Commercial Bank. Everything was o.k. until November of last year when they increased the interest rate. Since then they have increased the rate 7 times! We are now paying a rate of 8.3000482%. (If you take the last 6 digits of this rate it works out at just over 7 Satangs a month!) My wife has been to the bank 3 times to query the rate and had been told finally that nothing can be done, and if we do not like it we should move to another bank. We have never missed or even been late with a repayment and this is how we are treated. We have been to 4 other banks and the very worst is 6.25% so we are in the process of moving the loan, but we have to pay a 1% tax for the transfer to the land office. I am at a complete loss in understanding Siam Bank's attitude. Anyone else have the same problem?

Sounds like a variable rate, always try to look for a fixed rate when you sign the contract if possible and length of terms.

I think you are in a catch 22 situation.

As far as I can see, you have 6 options and none of them are good.

1. Continue paying the interested rate with your present bank.

2. Move the mortgage to another bank and pay the 1% penalty at the land office.

3. Ask your bank if they could extend the mortgage payments over a longer period.

You may pay a lesser amount by month, but over the long term the total interest will be more.

4. Inquire with the bank if they have any other type of mortgage schemes you could transfer to.

5. Try and sell the property and retrieve the amount of the loan and then pay the balance owed to the bank

6. Default on the mortgage and let the lender repossess the land and property.

This of course may mean being taken to the civil court for non-payment of loan.

This is the same situation that I was in when I had a variable mortgage in the UK. It became a nightmare.

At one time during the late 1980s, the interest rate increased to 15.5% and we had to rent out some rooms to help make the payments.

Sorry, but with variable rate loans, the lenders can increase or decrease the rates at will and there is nothing you can do about it.

Have you watched the official interest rate movements in Thailand over the last 24 months?

Your reacting to; and going to be paying for a change in your banking, in response to a situation that that has occurred at all banks, not just yours.

Your money, your life. Good luck.

If SCB will not offer you a mortgage competitive with other banks, move to another bank. The difference between 8.3 and 6.025% will be paid every year and the 1% land office fee is only one time. You will need a good translation, maybe two, of any new mortgage document before signing, do not rely on what anyone tells you it says.

Do not worry about understanding SCB's attitude, it is an attitude expressed by many banks in many countries to customers large and small, simply stated as "screw you".

I used SCIB with my wife for a mortgage. We got two condo and two mortgages one from Kasikorn paying around 7,500 per month and then one with SCIB paying 6,000 a month. Cannot remember the interest rates.

SCIB has now been bought by Thanachart.

Same here. SCB are shifty... shiftier than banks are in general, that is. After declining insurance to protect payments, our mortgage was recalculated to include loss of said insurance to bank! No scruples, but they're all bastards. Best bet is try to drum up the money and pay the thing off.

They can only change the rate based on a formula that you agreed to when you took out the mortgage. You should re-read the translated copy that you got when you took out the mortgage.