Mortgage Company willing to Loan 50% (whoops you're American, Forget it!)

[daboyz1]

I got this response when looking in to a mortgage here in Thailand:

 

Dear Mr. ******,

Yes, you are correct that you may own the property in your name.

However, ****** will not lend to American citizens. This is something the Board declared earlier this year due to FATCA regulations. It is the only nationality they do not lend to.

Kind Regards,

[Senechal]

Well.. FATCA regulations are pretty awful.

 

The fact that the US government applies regulations to foreign corporations doing business in their own countries is pretty off-the-charts ridiculous. I'd probably make the same decision.

 

That having been said, I think it's pretty tough for any foreigner to get a mortgage here from a bank. Mortgages from builders may be a different story.

 

 

Edited July 2, 2017 by Senechal

[ozmeldo]

Why would you want to borrow money to buy property here anyway? Real estate is already 20-60% overvalued, then add interest to some condo?

[daboyz1]

Why would you want to borrow money to buy property here anyway? Real estate is already 20-60% overvalued, then add interest to some condo?

I'm thinking it's cheaper than renting and I'll have something to show for it in the end. As it is now, I'm not building any equity.

[funandsuninbangkok]

Better to invest offshore and rent in Thailand. You return on your investment is much greater in US stocks. Condos depreciate in Thailand. 

[KittenKong]

15 hours ago, ozmeldo said:

Why would you want to borrow money to buy property here anyway? Real estate is already 20-60% overvalued, then add interest to some condo?

 

At least if you buy with loaned money someone else is taking most of the risk. I think that Thai banks know all about that one!

[funandsuninbangkok]

9 minutes ago, KittenKong said:

 

At least if you buy with loaned money someone else is taking most of the risk. I think that Thai banks know all about that one!

They not so smart

 

https://www.bloomberg.com/news/articles/2017-06-20/thailand-s-worse-than-china-bad-loan-ratio-seen-nearing-peak

 

 

[williamgeorgeallen]

9 hours ago, funandsuninbangkok said:

Better to invest offshore and rent in Thailand. You return on your investment is much greater in US stocks. Condos depreciate in Thailand. 

good advice. you have to accept that it is common for people not to pay the maintenance fee and have the place run down till it has to be knocked down.

i asked about a mortgage several years ago. 50% deposit, 10% interest over 10 years and a 1% cash fee to the bank manager. i decided against it. funandsunbangkok has the right idea about renting. the flexibility is priceless.

[funandsuninbangkok]

24 minutes ago, williamgeorgeallen said:

good advice. you have to accept that it is common for people not to pay the maintenance fee and have the place run down till it has to be knocked down.

i asked about a mortgage several years ago. 50% deposit, 10% interest over 10 years and a 1% cash fee to the bank manager. i decided against it. funandsunbangkok has the right idea about renting. the flexibility is priceless.

The 1% back to the branch manager explains a lot about why loans in Thailand are approved. Even to large companies. Massive fraud will kill everything here

[hdkane]

17 hours ago, daboyz1 said:

I'm thinking it's cheaper than renting and I'll have something to show for it in the end. As it is now, I'm not building any equity.

but...you will not be able to sell in a timely manner...there are lots of properties that no one can sell, as the real estate market is significantly over priced and over developed...and you truly want the option to move if you live in thailand...you may have a nice place today, but tomorrow, some idiot with six dogs moves into the place next to your's...or your neighbors become six taxi drivers up all night...or your neighbors are hookers...or the maintenance company of your condo decides to steal all the money and there are no funds for repair...on and on...i've lived each of those scenarios in a relatively short time in thailand...and there is very very little you can do..no one is interested in the problems of a farang, not even the police.

[williamgeorgeallen]

1 hour ago, funandsuninbangkok said:

The 1% back to the branch manager explains a lot about why loans in Thailand are approved. Even to large companies. Massive fraud will kill everything here

yes i was quite taken back at the 1% cash fee back in my early days. now i am more surprised at how well the system seems to run considering the amount of corruption.

[sgracer]

best to stay light & agile in thailand

 

you never know when something will happen that will require you to move quickly.

[daboyz1]

I was looking at buying the condo that I'm currently renting. I'm very happy there. The location is great, and since I'm on a corner unit, I only have one neighbor that I've never seen or heard.

My thought was that instead of wasting money on rent every month that I could put those funds towards ownership and actually build up some equity. Also I suspect the monthly cost would be less than half what I'm paying now.

I wasn't really looking at it as an investment to flip in the near future, rather a way to save some money long term. The plan being to live there for years.

[mduras01]

I was looking at buying the condo that I'm currently renting. I'm very happy there. The location is great, and since I'm on a corner unit, I only have one neighbor that I've never seen or heard.

My thought was that instead of wasting money on rent every month that I could put those funds towards ownership and actually build up some equity. Also I suspect the monthly cost would be less than half what I'm paying now.

I wasn't really looking at it as an investment to flip in the near future, rather a way to save some money long term. The plan being to live there for years.

I think that's what previous posters are saying. You are putting a massive down payment and not gaining equity, rather losing equity, like a car. Add to that a bit of political uncertainty (i.e. Visa uncertainty) and you may be in for a significant financial shock years down the road.


Sent from my iPhone using Thailand Forum - Thaivisa mobile app

[daboyz1]

I think that's what previous posters are saying. You are putting a massive down payment and not gaining equity, rather losing equity, like a car. Add to that a bit of political uncertainty (i.e. Visa uncertainty) and you may be in for a significant financial shock years down the road.

 

 

Sent from my iPhone using Thailand Forum - Thaivisa mobile app

The alternative is to keep paying rent, in which case I have zero hope of getting 1 baht back on that. If I put a 50% down payment on the place and my monthly housing cost is cut in half, then it seems like I'm doing alright because even though I've put down the massive down payment, it seems like the rent savings would offset the down payment in 10 years or so. Then after 10 years the rest is gravy.

 

I'm paying 25000 a month on what I suspect to be a condo worth 4 to 5 million baht currently.

 

 

 

[daboyz1]

I think that's what previous posters are saying. You are putting a massive down payment and not gaining equity, rather losing equity, like a car. Add to that a bit of political uncertainty (i.e. Visa uncertainty) and you may be in for a significant financial shock years down the road.


Sent from my iPhone using Thailand Forum - Thaivisa mobile app

The alternative is to keep paying rent, in which case I zero hope of getting 1 baht back on that. If I put a 50% down payment on the place and my monthly housing cost is cut in half, then it seems like I'm doing alright.

[dunque]

5 hours ago, funandsuninbangkok said:

They not so smart

 

https://www.bloomberg.com/news/articles/2017-06-20/thailand-s-worse-than-china-bad-loan-ratio-seen-nearing-peak

 

 

If you are an American and are disparaging another country's bank lending prowess, it is nice to see you guys do irony now.

[funandsuninbangkok]

1 hour ago, daboyz1 said:

The alternative is to keep paying rent, in which case I have zero hope of getting 1 baht back on that. If I put a 50% down payment on the place and my monthly housing cost is cut in half, then it seems like I'm doing alright because even though I've put down the massive down payment, it seems like the rent savings would offset the down payment in 10 years or so. Then after 10 years the rest is gravy.

 

I'm paying 25000 a month on what I suspect to be a condo worth 4 to 5 million baht currently.

 

 

 

Suit your self but if you invested in S and P expct 10% return.    ie your  5 million in  S and P stocks gives 500,000 a year profit  + if reinvested, compounded you get up to 20%  P. A. return in less than 8 years.

 

Weigh that with  putting 5 million in condo, paying transfer fees, maintenance, repairs and not being able to sale  - pretty much worthless after 10 years.  

 

http://www.investopedia.com/ask/answers/042415/what-average-annual-return-sp-500.asp

 

 

Rent in Thailand and invest offshore

 

 

 

[dotpoom]

On 02/07/2017 at 7:14 PM, ozmeldo said:

Why would you want to borrow money to buy property here anyway? Real estate is already 20-60% overvalued, then add interest to some condo?

I do not think so......it's a buyers market right now....people are dropping lumps off their asking prices.

    I have tried everything to sell my house in Bang Saray, dropped 1MB in the past 4 years, offered finance, willing to swap for a condo. I am not the only one......enquire around?

[Foozool]

6 hours ago, daboyz1 said:

I was looking at buying the condo that I'm currently renting. I'm very happy there. The location is great, and since I'm on a corner unit, I only have one neighbor that I've never seen or heard.

My thought was that instead of wasting money on rent every month that I could put those funds towards ownership and actually build up some equity. Also I suspect the monthly cost would be less than half what I'm paying now.

I wasn't really looking at it as an investment to flip in the near future, rather a way to save some money long term. The plan being to live there for years.

Be careful, situation changes without notice most of times. You may get a neighbor that you wish to leave as soon as possible. It has happened to me at least 2 times when I thought how everything is beautiful, but not anymore since my great neighbor moved out and a crazy one moved in instead.  

Unless you are not too picky about noise and banging doors. 

Good luck

[swissie]

6 hours ago, mduras01 said:

I think that's what previous posters are saying. You are putting a massive down payment and not gaining equity, rather losing equity, like a car. Add to that a bit of political uncertainty (i.e. Visa uncertainty) and you may be in for a significant financial shock years down the road.


Sent from my iPhone using Thailand Forum - Thaivisa mobile app

Rumor has it, that it is very hard for Farang Investors to sell their condo's in Caracas, Venezuela these days!

Cheers.

[daboyz1]

Rumor has it, that it is very hard for Farang Investors to sell their condo's in Caracas, Venezuela these days!
Cheers.

[emoji2] [emoji2] [emoji2] [emoji12] [emoji12] [emoji12]

[Davehappen]

Daboyz1, if you think this is the best option for you, DO IT. I built my own house in Isan, wouldn't have it any other way. There is a lot of embittered posters on here, who may or may not have just cause to debunk your thinking, but there is a lot happy people who have done there own thing and are enjoying life in thailand, no one can foresee the future, although some think they can!. Only you can know what's best for you. 

Good luck with which ever decision you make.

[Berkshire]

23 hours ago, daboyz1 said:

The alternative is to keep paying rent, in which case I have zero hope of getting 1 baht back on that. If I put a 50% down payment on the place and my monthly housing cost is cut in half, then it seems like I'm doing alright because even though I've put down the massive down payment, it seems like the rent savings would offset the down payment in 10 years or so. Then after 10 years the rest is gravy.

 

I'm paying 25000 a month on what I suspect to be a condo worth 4 to 5 million baht currently.

 

 

 

It would make sense for you to buy the place if you really like it and intend to stay for the long term....especially if the mortgage is actually less than the rent.  You should try more than one bank, their policies are not all the same.  As for the price, perhaps you can negotiate with the owner.  So the condo is worth 4-5 mil, 25k a month rent?  Must be a swanky place...unless you're in downtown BKK. 

[daboyz1]

It would make sense for you to buy the place if you really like it and intend to stay for the long term....especially if the mortgage is actually less than the rent.  You should try more than one bank, their policies are not all the same.  As for the price, perhaps you can negotiate with the owner.  So the condo is worth 4-5 mil, 25k a month rent?  Must be a swanky place...unless you're in downtown BKK. 

It's right on Sukhumvit about 100 meters from the On Nut BTS.

I'll check out some other options.

[Straight8]

On 02/07/2017 at 7:25 PM, daboyz1 said:

I'm thinking it's cheaper than renting and I'll have something to show for it in the end. As it is now, I'm not building any equity.

This thinking probably explains why property is so overvalued, especially in BKK.

 

 

 

 

[Straight8]

On 03/07/2017 at 3:36 PM, daboyz1 said:

The alternative is to keep paying rent, in which case I zero hope of getting 1 baht back on that. If I put a 50% down payment on the place and my monthly housing cost is cut in half, then it seems like I'm doing alright.
 

Yes, but if invest that 50% you intend to buy the condo with, well it would be making you money, and minimizing your risks.

[trogers]

On Mon Jul 03 2017 at 5:10 PM, funandsuninbangkok said:

Suit your self but if you invested in S and P expct 10% return.    ie your  5 million in  S and P stocks gives 500,000 a year profit  + if reinvested, compounded you get up to 20%  P. A. return in less than 8 years.

 

Weigh that with  putting 5 million in condo, paying transfer fees, maintenance, repairs and not being able to sale  - pretty much worthless after 10 years.  

 

http://www.investopedia.com/ask/answers/042415/what-average-annual-return-sp-500.asp

 

 

Rent in Thailand and invest offshore

 

 

 

Two problems with that.

 

One, you can get a mortgage to buy a condo unit, but not a bank loan to speculate in the financial markets. He presently does not have the full cash at hand.

 

Two, the financial market is also cyclical. What if you are caught in a bust?

[funandsuninbangkok]

4 hours ago, trogers said:

Two problems with that.

 

One, you can get a mortgage to buy a condo unit, but not a bank loan to speculate in the financial markets. He presently does not have the full cash at hand.

 

Two, the financial market is also cyclical. What if you are caught in a bust?

The numbers provided show clear trend of  10% returns in S and P stock vs negative returns in Thai real estate. 

 

You can lever up in stocks if you chose up to 70%. 

 

http://www.schwab.com/public/schwab/investing/accounts_products/investment/margin_accounts

 

I prefer to stick with cash value investing. REITs now are returning 7%

 

[Rancid]

On 03/07/2017 at 1:32 PM, sgracer said:

best to stay light & agile in thailand

 

you never know when something will happen that will require you to move quickly.

Can understand that paranoia, in fact I was told the same thing 30 years ago, perhaps if just wait a little bit longer it will be correct...