Borrowing Money Using Your House As Collateral.

[Carlosm]

My pension provider has put back my pension start date by 9 years leaving me in the lurch. So today me and my Thai wife went to the Siam commercial bank to get a loan using my house as collateral. Its valued at around 10mil baht. So i thought getting a loan for around 3mil baht would be no problem as theres plenty of room for the bank to cover their bases. They wouldnt even entertain it as niether of us has a regular income.

So, the question is, does anyone know which banks take your house as collateral on a loan or is there any other way to borrow around 3mil baht when you own your own 10mil baht house ?

[Soutpeel]

I suspect the root of your problem is the regular income bit, and they are questioning how you will make the month payments

I am sure your wife could get a loan shark to give you the money, but not a recommended move...

suspect you will find the same reponse from most commerical banks...

also you mention "my house" one assumes the house is in your name somehow ?...this will be another reason the loan has been declined, due to land ownership issues

[KarstenBoAndersen]

No income no loan !

My wife had for more then 10 Mill. property, and wanted to borrow 2 Mill. for a new house !

She only got it, because she have an income, proven by Tax payments etc. and that was in Bangkok bank, so forget all others !

They only borrow out based on your income, as they say, how can you pay back when you not have a proven income ??

[Carlosm]

Whilst my name is in the tabian bahn book the land thus the house is in my wifes name.

[patekatek]

No income, yet we have to provide verifiable income of much more than an average Thai makes just to retire here or live with your Thai spouse.

[happynthailand]

with SCB no proof of income ,no loan

have had several loans thru them,all paid back before the time the final payment was do

will say this about SCB,once you have good credit with them,they bend over backwards,with any new loan

[jimmybkk]

If a bank is out of the question there are other options. I know of at least one (legit) company in Pattaya that you could speak to. They are a law firm amongst other things and their reputation is good. It's been a while since I checked but a couple of years ago the rate was 18% pa up to 50% of the value of the property - it may have changed since then. Bear in mind that you effectively sign over the property into their name with a legally binding agreement that states that it is transferred back into your name once repayments are complete. From what I understand it's fairly common practice here. Maybe someone with legal knowledge can offer more information on the way these loans are structured.

PM me if you want their details.

[JeremyBowskill]

Tried to do the same thing myself recently and although I didn't take the loan in the end kasikorn bank did agree to it in principal. Maybe give them a shot, I and another friend of mine found them much more helpful than the other banks.

[Naam]

If a bank is out of the question there are other options. I know of at least one (legit) company in Pattaya that you could speak to. They are a law firm amongst other things and their reputation is good. It's been a while since I checked but a couple of years ago the rate was 18% pa up to 50% of the value of the property - it may have changed since then. Bear in mind that you effectively sign over the property into their name with a legally binding agreement that states that it is transferred back into your name once repayments are complete. From what I understand it's fairly common practice here. Maybe someone with legal knowledge can offer more information on the way these loans are structured.

PM me if you want their details.

the rate was 18% pa

[jimmybkk]

If a bank is out of the question there are other options. I know of at least one (legit) company in Pattaya that you could speak to. They are a law firm amongst other things and their reputation is good. It's been a while since I checked but a couple of years ago the rate was 18% pa up to 50% of the value of the property - it may have changed since then. Bear in mind that you effectively sign over the property into their name with a legally binding agreement that states that it is transferred back into your name once repayments are complete. From what I understand it's fairly common practice here. Maybe someone with legal knowledge can offer more information on the way these loans are structured.

PM me if you want their details.

the rate was 18% pa

I'm not saying it's an attractive rate, just that it's an option if a bank is out of the question. Probably similar to the rate you would pay on a credit card.

Have you seen any of these TV advertisements for quick cash loans in the UK? 2,000% pa and up. Now that's an interest rate right there.....

[rgs2001uk]

If a bank is out of the question there are other options. I know of at least one (legit) company in Pattaya that you could speak to. They are a law firm amongst other things and their reputation is good. It's been a while since I checked but a couple of years ago the rate was 18% pa up to 50% of the value of the property - it may have changed since then. Bear in mind that you effectively sign over the property into their name with a legally binding agreement that states that it is transferred back into your name once repayments are complete. From what I understand it's fairly common practice here. Maybe someone with legal knowledge can offer more information on the way these loans are structured.

PM me if you want their details.

the rate was 18% pa

For someone with no credit history or regular income its on the low end of repayments.

We only have the OPs word his house is worth what he says.

As Jimm says fairly common, I mentioned on another thread I no longer get the natives asking for loans, as soon as you tell them yeah no problem tomorrow we are off to the land office to sign over your house they soon say oh no have ploblem now.

On the street for those with nothing, the going rate is 50% per month, 25% per month is not uncommon, if you want to borrow 100k, you will be given 80k in your hand with the other 20k taken as your first repayment.

No wonder many do a runner back to Nakon Nowhere.

[rgs2001uk]

Of more concern to many may well be the following,

My pension provider has put back my pension start date by 9 years leaving me in the lurch

Whats the name of the pension provider and what was the reasoning?

I personally think we are only now starting to see the full effects of the global/market downturn, there may well be others sitting on a timebomb not of their own making.

[IMA_FARANG]

Robert Frost, the American poet, said it about banks,

"A Bank is a place that is happy to lend you an Umbrella when the Sun is shining, but want it back, with interest attached, the minute they see a cloud in the sky:

Never forget that qoute.

[yoshiwara]

Why on earth would someone with no declarable income want to borrow 3m baht in the first place? No means to pay it back? It is poor business both for the bank and the borrower. The sensible solution is to sell the 10 million baht property and downsize to a cheaper property if release of capital is required. Did I read that the property is in the wife's name? Well a decision to sell what is in her name will be interesting.

[PattayaPhom]

If a bank is out of the question there are other options. I know of at least one (legit) company in Pattaya that you could speak to. They are a law firm amongst other things and their reputation is good. It's been a while since I checked but a couple of years ago the rate was 18% pa up to 50% of the value of the property - it may have changed since then. Bear in mind that you effectively sign over the property into their name with a legally binding agreement that states that it is transferred back into your name once repayments are complete. From what I understand it's fairly common practice here. Maybe someone with legal knowledge can offer more information on the way these loans are structured.

PM me if you want their details.

On 3 Mil thats over 40k interest a month.......you gotta be kidding

Edited January 18, 2013 by PattayaPhom

[Payboy]

If a bank is out of the question there are other options. I know of at least one (legit) company in Pattaya that you could speak to. They are a law firm amongst other things and their reputation is good. It's been a while since I checked but a couple of years ago the rate was 18% pa up to 50% of the value of the property - it may have changed since then. Bear in mind that you effectively sign over the property into their name with a legally binding agreement that states that it is transferred back into your name once repayments are complete. From what I understand it's fairly common practice here. Maybe someone with legal knowledge can offer more information on the way these loans are structured.

PM me if you want their details.

the rate was 18% pa

Class loan sharking, that one.

[MrRealDeal]

Suzy Orman would tell you ...... You cant afford it ..... sell the house and downsize before you HAVE to sell the house and downsize...... it's gona be the same in the end expect option 2 will force you to sell it at a reduced price most likely.

[Soutpeel]

If a bank is out of the question there are other options. I know of at least one (legit) company in Pattaya that you could speak to. They are a law firm amongst other things and their reputation is good. It's been a while since I checked but a couple of years ago the rate was 18% pa up to 50% of the value of the property - it may have changed since then. Bear in mind that you effectively sign over the property into their name with a legally binding agreement that states that it is transferred back into your name once repayments are complete. From what I understand it's fairly common practice here. Maybe someone with legal knowledge can offer more information on the way these loans are structured.

PM me if you want their details.

the rate was 18% pa

Do they wear a mask and carry a pistol ?

[yoshiwara]

Suzy Orman would tell you ...... You cant afford it ..... sell the house and downsize before you HAVE to sell the house and downsize...... it's gona be the same in the end expect option 2 will force you to sell it at a reduced price most likely.

[jimmybkk]

If a bank is out of the question there are other options. I know of at least one (legit) company in Pattaya that you could speak to. They are a law firm amongst other things and their reputation is good. It's been a while since I checked but a couple of years ago the rate was 18% pa up to 50% of the value of the property - it may have changed since then. Bear in mind that you effectively sign over the property into their name with a legally binding agreement that states that it is transferred back into your name once repayments are complete. From what I understand it's fairly common practice here. Maybe someone with legal knowledge can offer more information on the way these loans are structured.

PM me if you want their details.

the rate was 18% pa

Do they wear a mask and carry a pistol ?

Errr... no, because it is the borrower's decision to accept the loan or otherwise. The teller at Bangkok Bank didn't wear a mask and carry a pistol when they gave me my nice shiny credit card either.

I am not saying the rate is fantastic, nor advocating their services, but it's all about circumstances. The reason I know of the rate is because a friend had made a 10 million Baht downpayment on a condo and the deal was that the 20 million balance had to be paid by a certain date. When he made the purchase the guy was certain he would be able to liquidate an asset in the UK to pay the 20 million by the due date. There was a slight legal complication and the completion of his asset sale in the UK was delayed by several months pushing him beyond the due date. The banks wouldn't touch him and so he faced the option of forfeiting his 10 million deposit, or taking a loan out for a couple of months until he could get the cash from the UK. He chose to take the loan and ended up paying around 600,000 interest to save 10 million.

I dunno if they were wearing the mask and carrying a pistol at the time, but regardless, he gave the lenders a big sloppy kiss...

[Naam]

so he faced the option of forfeiting his 10 million deposit

hats off! he must be a seasoned and well experienced businessman to enter such an agreement

[fletchsmile]

If a bank is out of the question there are other options. I know of at least one (legit) company in Pattaya that you could speak to. They are a law firm amongst other things and their reputation is good. It's been a while since I checked but a couple of years ago the rate was 18% pa up to 50% of the value of the property - it may have changed since then. Bear in mind that you effectively sign over the property into their name with a legally binding agreement that states that it is transferred back into your name once repayments are complete. From what I understand it's fairly common practice here. Maybe someone with legal knowledge can offer more information on the way these loans are structured.

PM me if you want their details.

the rate was 18% pa

Do they wear a mask and carry a pistol ?

Errr... no, because it is the borrower's decision to accept the loan or otherwise. The teller at Bangkok Bank didn't wear a mask and carry a pistol when they gave me my nice shiny credit card either.

I am not saying the rate is fantastic, nor advocating their services, but it's all about circumstances. The reason I know of the rate is because a friend had made a 10 million Baht downpayment on a condo and the deal was that the 20 million balance had to be paid by a certain date. When he made the purchase the guy was certain he would be able to liquidate an asset in the UK to pay the 20 million by the due date. There was a slight legal complication and the completion of his asset sale in the UK was delayed by several months pushing him beyond the due date. The banks wouldn't touch him and so he faced the option of forfeiting his 10 million deposit, or taking a loan out for a couple of months until he could get the cash from the UK. He chose to take the loan and ended up paying around 600,000 interest to save 10 million.

I dunno if they were wearing the mask and carrying a pistol at the time, but regardless, he gave the lenders a big sloppy kiss...

Bizarre story. Normally when you buy a condo you sign a contract. The contract normally states what happens if either party is late with complying. Ours:

-had penalty interest of 1% per month for either party late

-had a clause that if it falls thru then the money is refunded, title to the property doesn't pass, and then a charge is payable by the party that doesn't fulfil the contract

Who in their right mind signs a contract that you lose your deposit equal to half the price of your property, however unlikely you think it may be?

[transam]

If a bank is out of the question there are other options. I know of at least one (legit) company in Pattaya that you could speak to. They are a law firm amongst other things and their reputation is good. It's been a while since I checked but a couple of years ago the rate was 18% pa up to 50% of the value of the property - it may have changed since then. Bear in mind that you effectively sign over the property into their name with a legally binding agreement that states that it is transferred back into your name once repayments are complete. From what I understand it's fairly common practice here. Maybe someone with legal knowledge can offer more information on the way these loans are structured.

PM me if you want their details.

the rate was 18% pa

Do they wear a mask and carry a pistol ?

I know a farang, noooooooooooo sorry, his wife , charges 36% PA.

[fletchsmile]

To OP, very unlikely you'll get a loan from a bank. Banks generally lend vs ability to repay, and don't want to be in the business of owning properties they then have to offload. The property is simply collateral / security in case things go wrong. Primary importance is ability to service the debt.

Equity-release mortgages aren't really a part of the Thai mortgage market.

Stay away from that 18% loan. Yes it may be similar to a credit card rate, but credit cards are unsecured. That rate is secured by your house title deeds so a secured loan should be a lower rate.

Given you're looking at 9 years before being in a position to even start repaying from what you describe that isn't in either your or the lenders interest anyway to do. Unless of course the lender charges an exhorbitant rate. 18% compounded for 9 years with no repayments would quadruple your debt. So the debt starting at 3mio would soon be more than the house. Even at 8% it would double over 9 years.

In your shoes I'd be looking to sell and downsize. It might be a possibility to sell it and rent it back to you if you could find someone interested although that's not that likely, it may be an option, as someone may take say a 6% rental yield. Still leaves you without ownership but at least in the same house.

[jimmybkk]

so he faced the option of forfeiting his 10 million deposit

hats off! he must be a seasoned and well experienced businessman to enter such an agreement

Lol - you know no real details of the deal, nothing about how much the property was discounted based on the agreed terms, are clueless about how the situation played out, nothing about the background of the individual concerned and yet, somehow, you feel that you are in a position to sit on your lofty perch and pass judgement on the business acumen of the gentleman who entered into the agreement.

At the same time you offer no positive input to the thread, no constructive ideas/suggestions to assist the OP's situation, and instead attempt to mock/criticize someone who is simply providing the OP with an option.

I would say "hats off" to you sir...

[jimmybkk]

"Who in their right mind signs a contract that you lose your deposit equal to half the price of your property, however unlikely you think it may be?"

Who in their right mind is unable to calculate that a 10 million Baht deposit with 20 million Baht outstanding means that the deposit paid represents one third of the sales price and not half? Apparently only a real estate professional...

[mccw]

To OP, very unlikely you'll get a loan from a bank. Banks generally lend vs ability to repay, and don't want to be in the business of owning properties they then have to offload. The property is simply collateral / security in case things go wrong. Primary importance is ability to service the debt.

Equity-release mortgages aren't really a part of the Thai mortgage market.

Stay away from that 18% loan. Yes it may be similar to a credit card rate, but credit cards are unsecured. That rate is secured by your house title deeds so a secured loan should be a lower rate.

Given you're looking at 9 years before being in a position to even start repaying from what you describe that isn't in either your or the lenders interest anyway to do. Unless of course the lender charges an exhorbitant rate. 18% compounded for 9 years with no repayments would quadruple your debt. So the debt starting at 3mio would soon be more than the house. Even at 8% it would double over 9 years.

In your shoes I'd be looking to sell and downsize. It might be a possibility to sell it and rent it back to you if you could find someone interested although that's not that likely, it may be an option, as someone may take say a 6% rental yield. Still leaves you without ownership but at least in the same house.

The best advise right there

[Carlosm]

To OP, very unlikely you'll get a loan from a bank. Banks generally lend vs ability to repay, and don't want to be in the business of owning properties they then have to offload. The property is simply collateral / security in case things go wrong. Primary importance is ability to service the debt.

Equity-release mortgages aren't really a part of the Thai mortgage market.

Stay away from that 18% loan. Yes it may be similar to a credit card rate, but credit cards are unsecured. That rate is secured by your house title deeds so a secured loan should be a lower rate.

Given you're looking at 9 years before being in a position to even start repaying from what you describe that isn't in either your or the lenders interest anyway to do. Unless of course the lender charges an exhorbitant rate. 18% compounded for 9 years with no repayments would quadruple your debt. So the debt starting at 3mio would soon be more than the house. Even at 8% it would double over 9 years.

In your shoes I'd be looking to sell and downsize. It might be a possibility to sell it and rent it back to you if you could find someone interested although that's not that likely, it may be an option, as someone may take say a 6% rental yield. Still leaves you without ownership but at least in the same house.

The best advise right there

i agree

[fletchsmile]

"Who in their right mind signs a contract that you lose your deposit equal to half the price of your property, however unlikely you think it may be?"

Who in their right mind is unable to calculate that a 10 million Baht deposit with 20 million Baht outstanding means that the deposit paid represents one third of the sales price and not half? Apparently only a real estate professional...

Haha.. sorry I misread your post as 10mio on a 20mio property - perhaps in the shock/ surprise someone would put 10mio at risk like that

Regardless of whether 10mio on 30mio, or 10mio on 20mio, putting 10mio down and the risk of just losing it like that without a decent contract... I'd have thought most people would ask themselves what happens if delays occur - particularly as we're in Thailand. Or at least hire a lawyer before purchasing, who picks that up as standard . Costly mistake THB 600k - ouch!

[Naam]

so he faced the option of forfeiting his 10 million deposit

hats off! he must be a seasoned and well experienced businessman to enter such an agreement

Lol - you know no real details of the deal, nothing about how much the property was discounted based on the agreed terms, are clueless about how the situation played out, nothing about the background of the individual concerned and yet, somehow, you feel that you are in a position to sit on your lofty perch and pass judgement on the business acumen of the gentleman who entered into the agreement.

At the same time you offer no positive input to the thread, no constructive ideas/suggestions to assist the OP's situation, and instead attempt to mock/criticize someone who is simply providing the OP with an option.

I would say "hats off" to you sir...

do you think your input was constructive? gimme a break man!