Bank Loan for a condo

[koeko]

Hey,

I returned from the bank with a list of documents needed to get a loan to buy a condo. They will only cover 50% as I'm a foreigner, so I need to have the other 50% naturally.

Now, in order to get this loan, they want a "sale document" (not sure how that's called) for the condo that I want to buy. My question is, what happen if by the time I get the money, I decide to buy another condo? Can I just use the money to buy that other condo instead of the first one, or do I need to get a permission from the bank first?

Second question, as they offer me a loan of 50% of the price of the condo, can I get a second loan, from another bank, to cover the other 50% so I will have a 100% loan? is it legal?

Thanks!

[Chippen Dong]

50% >the chicken and the egg which came first?.

first i have ever hear of foreigner being able to get a thai bank loan for a condo.

which bank? or even better which branch of which bank.

Edited December 11, 2013 by Chippen Dong

[koeko]

50% >the chicken and the egg which came first?.

first i have ever hear of foreigner being able to get a thai bank loan for a condo.

which bank? or even better which branch of which bank.

Are you kidding? It's very common. I'm not talking about tourists of course, but expatriates.

Have already received confirmation from the bank (Kasikorn) for the 50%. I could get 80% if I had a work permit, but I only have a Non-O visa.

I also have a local banking history as I withdraw money to my Kasikorn account from aboard monthly for many years.

Edited December 11, 2013 by koeko

[craigt3365]

Interesting question. I'd say the load is "tied" to a particular condo unit. I doubt you'd be able to just switch after the loan approval. But, I don't know for sure.

So...let's move this over to the banking forum and see what the experts over there have to say.

Topic Moved.

[Chippen Dong]

ok will ask at kasikorn, but am still wary of buying when renting is so abysmally cheap it doesnt make any financial sense to buy, and then to be straddled with those associated ownership problems.

[Langsuan Man]

50% >the chicken and the egg which came first?.

first i have ever hear of foreigner being able to get a thai bank loan for a condo.

which bank? or even better which branch of which bank.

Are you kidding? It's very common. I'm not talking about tourists of course, but expatriates.

Have already received confirmation from the bank (Kasikorn) for the 50%. I could get 80% if I had a work permit, but I only have a Non-O visa.

I also have a local banking history as I withdraw money to my Kasikorn account from aboard monthly for many years.

Just because you brought home a bunch of papers from the bank doesn't mean that they are going to give you a loan. The reason the bank wants a sales document is because they have to know what amount is 50%, since your word in not good enough. They want to see what the full price is and then they will most likely pay the amount to the seller, not to you. And my guess is , like for a credit card or car purchase, you will either have to have a Thai as a co-signer or have enough on deposit for the bank to "loan" you the money

I don't know the law here in Thailand but going to another bank to get another 50% would be considered fraud in most places

Assuming of course that they will give you a loan for a condo on a O Visa, maybe a permanent residency, but like others I will believe it when you post the loan document (minus your details) here at TV

[koeko]

I do have a Thai co-signer (my wife) and they agreed that the condo will be in my own name.

[koeko]

ok will ask at kasikorn, but am still wary of buying when renting is so abysmally cheap it doesnt make any financial sense to buy, and then to be straddled with those associated ownership problems.

Well after 15 years of paying rents I could be the owner already! Taking a bank loan is the same as renting with the only difference that at the end I'll be the owner of the place. And even if I decide to move to another city, I can still rent the condo to somebody else, so there's really no reason to keep paying rents to other people (who were smart enough to become owners)!

[Chippen Dong]

ok just revisited my concerns and remembered the major one being any place that a foreigner can own would have too much bad news hanging around the door step/entrance 24/7 sorry you can keep it all to yourself.

Edited December 11, 2013 by Chippen Dong

[Chippen Dong]

ok will ask at kasikorn, but am still wary of buying when renting is so abysmally cheap it doesnt make any financial sense to buy, and then to be straddled with those associated ownership problems.

Well after 15 years of paying rents I could be the owner already! Taking a bank loan is the same as renting with the only difference that at the end I'll be the owner of the place. And even if I decide to move to another city, I can still rent the condo to somebody else, so there's really no reason to keep paying rents to other people (who were smart enough to become owners)!

not in this country. the sums dont add up. and property that you can own depreciates and is hard to sell due to over abundance. look at other comments on this forum about owning.. the price always includes a non redeemable "face" value.

Edited December 11, 2013 by Chippen Dong

[Chippen Dong]

but hey don't let me dissuade you.

i am in a different situation, i am not saddled with a Thai wife whose face i have to maintain at all costs every day of the year.

good luck

[meechai]

I don't know the law here in Thailand but going to another bank to get another 50% would be considered fraud in most places

No more than a 2nd mortgage or credit line against a house which is common in many places in the world.

But...The problem here in Thailand is I doubt any bank wants 2nd chair.

The original bank will be 1st lien holder

[oogster8]

ok will ask at kasikorn, but am still wary of buying when renting is so abysmally cheap it doesnt make any financial sense to buy, and then to be straddled with those associated ownership problems.

Problems like above unit dripping h20 on your face while you sleep..............lol.

Get the DUCTtape somchai..................lol.

[meechai]

Well after 15 years of paying rents I could be the owner already! Taking a bank loan is the same as renting with the only difference that at the end I'll be the owner of the place. And even if I decide to move to another city, I can still rent the condo to somebody else, so there's really no reason to keep paying rents to other people (who were smart enough to become owners)!

Many of us have done just that. The mod who moved your topic here would have been better

to have moved it to the real estate section you would have gotten better answers.

Don't be too concerned with some of the grinch answers from those who don't/can't own yet feel compelled to tell

you why your wrong in wanting to do so.

If you plan to stay long term you will as you say own instead of rent & possibly benefit from equity too.

We bought in 2004 have paid it off already & now live rent free in a nice condo.

Also by chance it is now worth near double what we paid if we should ever decide to sell. (unlikely)

Just try to find one you like for quality & location & has good management to take care of maintenance etc.

Another nice thing for us anyway is yearly maintenance here is so cheap compared to elsewhere in the world.

In all these years they have done an outstanding job & the building is in top shape. which is probably

why the value has gone up.

Edited December 11, 2013 by meechai

[fletchsmile]

Well after 15 years of paying rents I could be the owner already! Taking a bank loan is the same as renting with the only difference that at the end I'll be the owner of the place. And even if I decide to move to another city, I can still rent the condo to somebody else, so there's really no reason to keep paying rents to other people (who were smart enough to become owners)!

Many of us have done just that. The mod who moved your topic here would have been better

to have moved it to the real estate section you would have gotten better answers.

Don't be too concerned with some of the grinch answers from those who don't/can't own yet feel compelled to tell

you why your wrong in wanting to do so.

If you plan to stay long term you will as you say own instead of rent & possibly benefit from equity too.

We bought in 2004 have paid it off already & now live rent free in a nice condo.

Also by chance it is now worth near double what we paid if we should ever decide to sell. (unlikely)

Just try to find one you like for quality & location & has good management to take care of maintenance etc.

Another nice thing for us anyway is yearly maintenance here is so cheap compared to elsewhere in the world.

In all these years they have done an outstanding job & the building is in top shape. which is probably

why the value has gone up.

Yes, I'll echo that Meechai, after renting for many years, we've been happy since we bought.

The wife had a 10 year mortgage guaranteed by me on a fixed rate. We paid it off after 3 years though when the fixed term expired. Have been in it 6 years now. As you say:

- Nice to have a place to call home that we own for our family on our terms that we control

- Nice to know my wife and kids will have a roof over her head if something happens to me

- Nice to have THB assets to reduce currency mismatches and risk

- Nice to have fixed the costs for where we live and know there'll be no significant increases or changes at the whim of a landlord

- Nice to know that the replacement cost today would be higher today than when we bought

- Nice to know that in GBP terms it's worth significantly more as the rate has gone from GBP/THB 70 to 50.

- Nice to know I'm not renting here funded by GBP income, particularly funded by UK bank interest where rates have tanked

Cheers

Fletch

[fletchsmile]

Koeko

Check out all your documents for what the actual situation is. There are various checks and balances and obstacles in the admin process and execution. Not just on the bank side. Things do change but a few things to be wary of:

1) Normally banks in Thailand don't lend to foreigners directly for mortgages. In our case and the policy of the bank:

- They wanted the mortgage and condo in the same name

- They wouldn't lend to me, but would lend to my wife guaranteed by me

2) For a foreigner to buy they usually have to prove the money came in from overseas. This is a key reason why mortgages for foreigners from a Thai bank don't work. If a Thai bank lends it is not from overseas

3) On buying at the land registry office, I had to sign a paper saying it was bought with the wife's own money not mine

I suspect in your case it will not be exactly 50/50, there will be a slight diff so that it can be registered as Thai or foreign. I suspect also that they are not actually processing it as a joint loan, but as a loan to your spouse with you guaranteeing. Watch also for the points 2) and 3) above if trying to register as foreign ownership - I think you'll hit issues.

In terms of choosing another condo, it's likely additional paperwork is needed. They usually want a valuation on the property you are buying as part of the process before releasing funds. It will help you had a loan approved in principle but there'll still be a revisit to the loan for the valuation.

As for your second question I would be very surprised if you could get a second bank to give you a mortgage. The banks usually take a 1st charge over the property. In our case and many I know they also hold the title deeds until the loan is paid off. In addition banks will usually often a credit check on the person buying.

Cheers

Fletch:)

BTW: I expect the sale document they are referring to is a copy of the sales contract purchase the condo.

Edited December 12, 2013 by fletchsmile

[koeko]

Koeko

Check out all your documents for what the actual situation is. There are various checks and balances and obstacles in the admin process and execution. Not just on the bank side. Things do change but a few things to be wary of:

1) Normally banks in Thailand don't lend to foreigners directly for mortgages. In our case and the policy of the bank:

- They wanted the mortgage and condo in the same name

- They wouldn't lend to me, but would lend to my wife guaranteed by me

2) For a foreigner to buy they usually have to prove the money came in from overseas. This is a key reason why mortgages for foreigners from a Thai bank don't work. If a Thai bank lends it is not from overseas

3) On buying at the land registry office, I had to sign a paper saying it was bought with the wife's own money not mine

I suspect in your case it will not be exactly 50/50, there will be a slight diff so that it can be registered as Thai or foreign. I suspect also that they are not actually processing it as a joint loan, but as a loan to your spouse with you guaranteeing. Watch also for the points 2) and 3) above if trying to register as foreign ownership - I think you'll hit issues.

In terms of choosing another condo, it's likely additional paperwork is needed. They usually want a valuation on the property you are buying as part of the process before releasing funds. It will help you had a loan approved in principle but there'll still be a revisit to the loan for the valuation.

As for your second question I would be very surprised if you could get a second bank to give you a mortgage. The banks usually take a 1st charge over the property. In our case and many I know they also hold the title deeds until the loan is paid off. In addition banks will usually often a credit check on the person buying.

Cheers

Fletch:)

BTW: I expect the sale document they are referring to is a copy of the sales contract purchase the condo.

Thanks a lot for all your helpful advice!

[Jasun]

50% >the chicken and the egg which came first?.

first i have ever hear of foreigner being able to get a thai bank loan for a condo.

which bank? or even better which branch of which bank.

Every one of them. As long as you have the work permit and evidence of income. As has been mentioned, you need a bigger deposit than usual, typically 30-50% depending on the bank.

[Jasun]

ok will ask at kasikorn, but am still wary of buying when renting is so abysmally cheap it doesnt make any financial sense to buy, and then to be straddled with those associated ownership problems.

Well after 15 years of paying rents I could be the owner already! Taking a bank loan is the same as renting with the only difference that at the end I'll be the owner of the place. And even if I decide to move to another city, I can still rent the condo to somebody else, so there's really no reason to keep paying rents to other people (who were smart enough to become owners)!

I think this is the best way to look at it. You certainly can't buy into a condo in Thailand hoping to make a fortune (if anything) in capital growth. But if you're prepared to stay in one place for a while, the money you'll save in rent will put you way ahead. And as an investment the yield is quite good.

[koeko]

50% >the chicken and the egg which came first?.

first i have ever hear of foreigner being able to get a thai bank loan for a condo.

which bank? or even better which branch of which bank.

Every one of them. As long as you have the work permit and evidence of income. As has been mentioned, you need a bigger deposit than usual, typically 30-50% depending on the bank.

As I said earlier you don't necessarily need a work permit, a local history is enough. I don't know the exact requirements but I know for sure that withdrawing money to your Thai bank account from aboard monthly for at least 2 years is a GO.

[Jasun]

50% >the chicken and the egg which came first?.

first i have ever hear of foreigner being able to get a thai bank loan for a condo.

which bank? or even better which branch of which bank.

Every one of them. As long as you have the work permit and evidence of income. As has been mentioned, you need a bigger deposit than usual, typically 30-50% depending on the bank.

As I said earlier you don't necessarily need a work permit, a local history is enough. I don't know the exact requirements but I know for sure that withdrawing money to your Thai bank account from aboard monthly for at least 2 years is a GO.

When I went down this road a number of years ago they asked for 2 year's tax receipts on a sole signed loan. I guess 2 years of regular deposits could satisfy that. At the time I was dealing with Kasikorn, Standchart and SCB. The only difference between them was how much they were prepared to lend.