Thai working people heavily in debts with loan sharks, says UTCC

[mgjackson69]

I know a lot of Thais and I don't see them buying a new phone every year as some have claimed. These people, like all people want something nice so they get a phone.

Your all hypocrites since most countries and their people are in debt. 160% GDP for China or even more debt in Japan. Let's not go into the trade deficit the USA has with other countries or the monumental credit most in the USA have.

If wealth was slightly more proportionally distributed in Thailand then these folks could afford a phone or a car without going into these micro debt transactions.

Go read about Russia and debt collectors in the NY times and see where Thailand is headed.

".....monumental credit most in the USA have..."

What does this mean?

Available credit? By some standards my available credit might be "monumental"...however, my usage of available credit is typically below 5%...hardly monumental.

"Your all hypocrites...."

First, it is "You're"

Secondly, we are not all hypocrites...irresponsible use of credit is a negative regardless of what country one is from. I know the news is full of gloom and doom about "the debt of the Americans"...that does not include me.

I have no sympathy for someone who borrows more than they can afford to pay back. It is easy to blame the "evil lenders", but it is on the borrower to be responsible. When I bought my first house 28 years ago I knew better to fall for that "you can qualify for this price home" line...I had already figured out what I could afford to comfortably pay each month and worked the numbers to find purchase price I could afford. I told the loan officer that I am looking at a house in this range (about half of what I "qualified" for), and if he could not help me with that I would take my business elsewhere.

I know plenty of other people like myself, who have managed our credit well and used it to our advantage.

[Sydebolle]

Household debt in the UK is huge. Mainly because of house prices/mortgages. Household debt in Thailand is unsustainable as no-body wants second hand cars or houses. The only asset of value is land. I can buy a secondhand Mercedes for 50,000 Baht in the UK. Here it is 200,000 Baht. I can buy a house in the UK for 10M Baht. But I can probably sell it. Here I can buy one for 5M Baht Unsaleable. The Bank will take it if I don't pay the loan, but they can't sell it either. Cuckoo land.

Although I think you do have a point, you're contradicting yourself. If no-one wanted 2nd hand cars, the prices would be low. As you've pointed out, second-hand cars are insanely expensive in Thailand.

Not quite so; compare apples with ....

While vehicle prices are absolutely crazy here it is noteworthy, that the prices for second hand cars went into free fall - specially in that particular segment of populistic car scheme programme for voters some five years ago.

In addition many cars got seriously damaged during the floods in 2011 and 2012. The cars got "fixed" by the insurance companies (if have) and the cars ended also on the second hand market.

The only vehicles keeping a decent resale value are those being owned first-hand by a foreigner; word had made rounds that the alien look much better after their vehicles than Khun Thai.

In all fairness:

- would you buy a second hand car in a regulated market with customer protection - yes.

- would you buy a second hand car if you cannot afford (are creditworthy) a new one - yes.

- would you buy a second hand car in Thailand - under no circumstances as odometers are spooled back or replaced, papers can be dodgy and most cars have seen the workshop in case of something already gone wrong; preventive maintenance and up-keeping is considered a waste of money and time. Accidents are fixed in seriously questionable workshops and broken parts are replaced with cheap copies.

A brand-new Toyota Landcruiser has an entry price in "uncheap" Switzerland of CHF 32'900 or THB 1'184'000; this money gets you - here in the Land - the same model with the distinct difference of being on the road for 16 years already - as so published on one2car.

The pricing, combined with an uneducated customer base, ferocious interest rates and the hovering-over-everything-face results in seriously mind-boggling market mechanisms.

[mgjackson69]

....preventive maintenance and up-keeping is considered a waste of money and time...

I beg to differ.

I would postulate that preventative maintenance and up-keeping is not even considered here.

Even something as simple to maintain as a bicycle is neglected...use it until it is broken, then toss it on the junk heap and buy a new one. Or take it back to the bicycle shop and trade it for a new one, getting a token amount for the old bicycle.

The only time I have seen Thais get involved in any kind of repairs/maintenance is when I start the job...then plenty show up to tell me how I am doing it wrong.

[Deserted]

There must be a dozen people on my street that fit into this category.

[1happykamper]

For a Third World Country the cars here are mostly, and amazingly, new (ish) !! The city of Chiang Mai is full of late model snazzy cars driven by all walks of life..I know a few Thai girls here who earn 15k baht per month and pay the bank 10k for their car!

[selftaopath]

Household debt in the UK is huge. Mainly because of house prices/mortgages. Household debt in Thailand is unsustainable as no-body wants second hand cars or houses. The only asset of value is land. I can buy a secondhand Mercedes for 50,000 Baht in the UK. Here it is 200,000 Baht. I can buy a house in the UK for 10M Baht. But I can probably sell it. Here I can buy one for 5M Baht Unsaleable. The Bank will take it if I don't pay the loan, but they can't sell it either. Cuckoo land.

Although I think you do have a point, you're contradicting yourself. If no-one wanted 2nd hand cars, the prices would be low. As you've pointed out, second-hand cars are insanely expensive in Thailand.

My experience is generally Thainess seems to deny a reduction in prices e.g. empty office space in BKK = raise the asking price, e.g. low toruists = raise the hotel rates etc. Seems to me the average Thai would rather not rent/sell than to lower prices. Wonder if this is another example of the lame "saving face" mentality?

[feelitwell]

It is called not thinking, like at all.

ladt example with realty is so on point as we speak. the rythm of how much tourists are moving from cm back to home or south at this time of s year leaves tons of available space.

but let them be emty, after all who needs to pay back investors

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[selftaopath]

Have money... buy iPhone.

No have money... borrow money... buy iPhone

Around here is seems like people believe "borrowing" is like getting a free gift; no intention or means to re-pay anything to anybody. ?????????

If/when asked how/when they intend to pay back a loan I've seen puzzlement on their faces followed by "never mind."

[feelitwell]

and you cannot blame them. nobody did teach them how stuff works. same is in west, just there its been around for so much longer so people have learned a bit how to handle this stuff without puzzlement in thei face. rather just pokerface.

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[mgjackson69]

Have money... buy iPhone.

No have money... borrow money... buy iPhone

Around here is seems like people believe "borrowing" is like getting a free gift; no intention or means to re-pay anything to anybody. ?????????

If/when asked how/when they intend to pay back a loan I've seen puzzlement on their faces followed by "never mind."

"Worry about that later"

[trogers]

For a Third World Country the cars here are mostly, and amazingly, new (ish) !! The city of Chiang Mai is full of late model snazzy cars driven by all walks of life..I know a few Thai girls here who earn 15k baht per month and pay the bank 10k for their car!

And the financing bank allows them to borrow...

[mgjackson69]

Have money... buy iPhone.

No have money... borrow money... buy iPhone

Around here is seems like people believe "borrowing" is like getting a free gift; no intention or means to re-pay anything to anybody. ?????????

If/when asked how/when they intend to pay back a loan I've seen puzzlement on their faces followed by "never mind."

I would attribute much of that mindset to the fact that most people's exposure to "finance and borrowing" is with family...and there is seldom any formal agreement, and even if there is, nobody is ever held to it.

[jerojero]

Cars, and iPhones for every family member. Regardless of family income, face gain trumps common financial sense.

[phoenixdoglover]

Two days ago my wife suggested I should buy her a new car, and that a car loan was the best way to do that.

This would be for our house in Khon Kaen, which is occupied by sister and niece, and which we visit for about 6 To 8 weeks each year.

My wife and her sister do not have drivers licenses. The niece already has a pickup truck.

Upon hearing the request, I chuckled, said it did not seem to me to be a good idea, and mentioned the drivers license issue.

This was not well received. Evidently the lack of a license is not a problem, and I am cheap. I took that last part as an unintended compliment.

Edited May 1, 2016 by phoenixdoglover

[feelitwell]

wow, u are one strong lover i see

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[feelitwell]

basically what she wanted is car for a niece right

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[DrTuner]

If relatives want a car, buy them the cheap crappo minilorry you see around here and then make them your personal transportation slaves for the lifetime of that car. They'll never ask again.

[feelitwell]

well te thing is as discussed throughout this topic as well that there is no cheap cars, even the oldest will cost good amount, also will need maintenance etc

and i really would not like to drive with someone who has no license, in a crappy old car

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