Letter of Guarantee for Condo purchase

[paulinbkk111]

Hi everyone,

Im buying a condo in BKK with money in Thailand. Its from a very large developer, and they need the following:

'residence certificate in Thailand': is my work permit the same?

'Letter of guarantee' from Bank. BKK Bank seem clueless as to what this is.

If anyone has done this procedure would be great to get some feedback!

[falkan]

You can use your Work permit or proof of residence..

[linguini]

would the letter of guarantee from the bank be the FET (Foreign Exchange Transaction) form from the bank? i recall for a foreigner to buy a condo, the Land Department will need to see a FET form issued by the bank to prove money was brought in from abroad in order to transfer the condo to a foreigner name.

[KittenKong]

Where I come from a letter of guarantee is basically a document from your bank that says that it will underwrite your purchase if you default on it.

http://www.investopedia.com/terms/l/letter_of_guarantee.asp

Maybe it has some other meaning in Thailand but I cant imagine a Thai bank being keen to issue one of these at all and even if it does you would probably need to actually block the amount of the purchase (or more) with them before they do so. I've also never heard of a developer here wanting one of these.

So it all seems odd.

[Crossy]

It doesn't always work, but -

Have you tried getting the developer to give you the requirements in Thai? After all that's what the bank people will understand best

[paulinbkk111]

Attached are 2 pics with what LPN gave me. Sorry the quality isnt great, Ill ask them for a soft copy!

[WorkingTourist]

For certificate of residence you need to go to immigration (application form TM.18). I believe this is easy to obtain, as it simply states your legal status in Thailand, but I have not applied for this myself.

The letter of guarantee sounds like they want a letter from your bank stating that you have enough money to pay for the condo. This should also be easy to get. I have previously asked Krungthai for a “letter of reference” and here they included the account balance (which is what you want).

It sounds like the developer just wants a government paper showing who you are, and a bank paper stating you have enough money to purchase the condo.

The latter is a little unusual, but it might be their way of verifying “origin of funds”. I.e. if the money are from a Thai bank account then they can assume that the bank has made sure that they do not stem from money laundering.

[linguini]

would this also mean a foreigner can purchase a condo without the need to wire-in the money from abroad (i.e. used the money earned in Thailand instead)? I have the impression that Land Department will need to see FET form in order to transfer a condo title deed to a foreigner?

[blackcab]

It looks to me like the first page is for permanent residents (as they do not have to show proof of funds originating outside of Thailand). That's why they talk of alien registration certificates.

The second page is for everyone else. I could not read the second page properly however.

[WorkingTourist]

would this also mean a foreigner can purchase a condo without the need to wire-in the money from abroad (i.e. used the money earned in Thailand instead)? I have the impression that Land Department will need to see FET form in order to transfer a condo title deed to a foreigner?

Section 19 in the Thailand Condominium Act states:

Aliens and juristic persons regarded by law as aliens may hold ownership of an apartment if the [sic] are the following:

• Aliens permitted to have residence in the Kingdom under the Immigration law;
• Aliens permitted to enter into the Kingdom under the investment promotion law;
• Juristic persons as provided in Section 97 and 98 of the Land Code and registered as juristic persons under Thai law;
• Juristic persons which are aliens under the Announcement of the National Executive Council No.281 dated November 24, B.E. 2515 and have obtained promotion certificate under investment promotion law;
• Aliens or juristic persons regarded by law as aliens who have brought in foreign currency into the Kingdom or withdraw money from Thai baht account of the person who have residence outside the Kingdom or withdraw money from a foreign currency account.

So if you fall under 1-4 above then you do not need to use foreign money for your condo purchase.

[KittenKong]

Section 19 in the Thailand Condominium Act states:

Aliens and juristic persons regarded by law as aliens may hold ownership of an apartment if the [sic] are the following:

• Aliens permitted to have residence in the Kingdom under the Immigration law;
• Aliens permitted to enter into the Kingdom under the investment promotion law;
• Juristic persons as provided in Section 97 and 98 of the Land Code and registered as juristic persons under Thai law;
• Juristic persons which are aliens under the Announcement of the National Executive Council No.281 dated November 24, B.E. 2515 and have obtained promotion certificate under investment promotion law;
• Aliens or juristic persons regarded by law as aliens who have brought in foreign currency into the Kingdom or withdraw money from Thai baht account of the person who have residence outside the Kingdom or withdraw money from a foreign currency account.

So if you fall under 1-4 above then you do not need to use foreign money for your condo purchase.

As far as I know 1-4 is for investments of 10MB or more, and the money still has to come from abroad. And you have to do all the paperwork in advance.

I think the OP needs an FET certificate.

[WorkingTourist]

Item 1 says that anyone permitted to have residence in the Kingdom under the Immigration law are allowed to buy a condo in Thailand.

So if OP has that then they can buy a condo, regardless of whether or not they are using foreign money.

Only item 2 and 4 talk about investing. Item 3 refers to Section 97 and 98 of the Land Code, which I do not know what is about, but we probably do not qualify

[blackcab]

Item 1 is for those that have been granted permanent residence. This process currently takes several years to achieve and is only open to those that have a work permit and have paid taxes for 3 full years, amongst other criteria.

One of the benefits of permanent residency is that you can use money earned indide Thailand (ie you don't need an FEC from the bank) to buy a condo.

Permanent residence is not the same as having a visa or an extension of stay.

[KittenKong]

Item 1 says that anyone permitted to have residence in the Kingdom under the Immigration law are allowed to buy a condo in Thailand.

So if OP has that then they can buy a condo, regardless of whether or not they are using foreign money.

Only item 2 and 4 talk about investing. Item 3 refers to Section 97 and 98 of the Land Code, which I do not know what is about, but we probably do not qualify

Sorry, I wrote 1-4 but I was referring only to item 4.

As mentioned, item 1 is for people with PR.

Item 2 is a much bigger investment package that also gives you a visa. You can even buy a small bit of land if you invest that much.

Item 3 is for Juristic persons, which the OP is not.

I dont think that the OP qualifies under any of the first 4 and so he will need money from outside of Thailand, which will surely mean an FET form.

As for the photos, page 2 seems to apply only to those who have a non-resident bank account. Page 1 is very unclear as it refers to the blue book which most farangs wont have. The mention at the top of the page about being prohibited is even less clear. But hey, since when were Thai documents in any way clear or precise?

Edited June 23, 2015 by KittenKong

[steveromagnino]

Check out some information here, this developer Raimon Land has a buyer guide which outlines what you need, Sansiri has the same thing (which I have a copy of but it isn't online AFAIK)

http://www.raimonland.com/en/Ourbusiness/BuyerGuide

I would think if LPN want something different (and I own a couple of their units) then you can talk to them once you know what you need to produce, namely the FET, and then it is possible they can reassess what you need to give to them.

[paulinbkk111]

Thanks for the Raimon land doc, very useful and clear.

Think easiest way is to send money from Australia to Thailand. Thanks all!