BJ The Bear
New Member
:001_Sawasdee: Hi, I have come across some very interesting information that i wish to share with people who are thinking about building, buying or need information on mortgage loans to enable you to purchase a property in Thailand.
There is (Sun Assets) who offer home loans for Thai People Living Abroad which would suit people who are married to a Thai,
this information can be found at:http://www.ghb.co.th/en/Service/SunAssets/index_en.html
The other is From: PFS International: which is explained below,
Last week we covered the ownership of property by foreigners in Thailand and some of the pitfalls and possibilities. This gives rise to the question of how foreigners can actually finance the purchase of a property here in the land of smiles.
Currently foreign ownership of property in Thailand is restricted to strata title leasehold apartments and condominiums for the vast majority. Some methodologies are available to own land but these are rare and sometimes not quite legal.
There are six major methods to finance the ownership of a property in Thailand.
1. Cash is King
Until very recently this was the most common method of purchasing your property here in Thailand. As an expat owner it was expected that you would be capable of coming up with sufficient sources to produce the cash required to finance your home or investment property.
Comparative prices have now increased and made property costs more expensive. This is partly because there are more sources of finance and these have also become more commonly available to Thai nationals. The demand by Farangs has also increased pushing prices higher.
2. Local Mortgage Finance
In recent years local Thai banks have developed mortgage products which have become far more readily available to Thai nationals. These have also been expanded by some of the banks to allow applications by foreigners to be considered. However, before you rush off to the local branch of your bank please note that there are restrictions applied to Farang applicants for this source of finance.
In general terms those local banks which will offer such finance are limited in numbers. You will also only find foreign banks which have local operating licences offering such facilities. This is because a foreign bank may not have legal title to land and thus it must have a local bank licence status to enter this specific market sector. To my knowledge there is only one foreign bank with a local licence offering mortgages to expats here.
At present the rules being applied by the banks offering mortgages to expats say that you must have a current valid a work permit for Thailand and this must have been held for at least a year or sometimes two. So, if you are retired or if you do not live in Thailand but wish to invest, maybe for your future here, you are highly unlikely to be granted such facilities.
Mortgages are generally offered for a period of ten to fifteen years, with a maximum loan repayment completion age of 60, and at a loan to value (LTV) of approximately 60% of the property value. No interest only loans are offered so you must enter a repayment mortgage loan to be reduced to zero over a relatively short period.
Whilst there are no official figures as to the success rate of mortgage applications by Farangs it is generally known in the industry that of those who apply somewhere between 5% and 10% actually close as a current mortgage. This shows just how difficult it is to obtain this type of finance.
3. Owner or Developer Finance
This is a relatively new method being utilised and is often largely used for foreigners because of the difficulties they encounter when trying to finance a property purchase. The arrangement is simple and will encompass an agreement to purchase a property from a seller partly using instalments to pay the price.
With developers this has gotten more commonplace. They will tend to offer averages of say 25% of the purchase price to be paid over a period of say five years or more. Depending on the individual agreement this may be granted at a nominal or very low interest rate, which is attractive to the buyer. So, if you see a condominium project for sale and feel it would be right for you but you do not have all the finance in place there may be a way to arrange this with the developer.
Where this is a new development there may be some time between the purchase date and the project completion date. During this period you may have an opportunity to accumulate further resources for your purchase.
A private purchase may also use this method. Where the seller is an individual this may make the difference between a fast sale and a long wait for the seller to realise the transaction. It may also help you secure your property where you weren’t quite able to raise the necessary funding.
Be careful and make sure to have any agreement drawn up by a lawyer to ensure both parties are protected and have your own lawyer review this agreement to make sure it will be acceptable to you.
These are the first three methods of finance you can use to purchase a property in Thailand. They are not all encompassing and do not offer completely comprehensive solutions. Next week we will discuss the three further alternatives which are more popular with expats and with which they seem to have more success.
Questions to the author can be directed to PFS International on 02 653 1971 or email to enquiriesthailand@fsplatinum.com
This company, I beleive is based in Bangkok,
I hope this information is helpful to others
B.J elephant-027
There is (Sun Assets) who offer home loans for Thai People Living Abroad which would suit people who are married to a Thai,
this information can be found at:http://www.ghb.co.th/en/Service/SunAssets/index_en.html
The other is From: PFS International: which is explained below,
Last week we covered the ownership of property by foreigners in Thailand and some of the pitfalls and possibilities. This gives rise to the question of how foreigners can actually finance the purchase of a property here in the land of smiles.
Currently foreign ownership of property in Thailand is restricted to strata title leasehold apartments and condominiums for the vast majority. Some methodologies are available to own land but these are rare and sometimes not quite legal.
There are six major methods to finance the ownership of a property in Thailand.
1. Cash is King
Until very recently this was the most common method of purchasing your property here in Thailand. As an expat owner it was expected that you would be capable of coming up with sufficient sources to produce the cash required to finance your home or investment property.
Comparative prices have now increased and made property costs more expensive. This is partly because there are more sources of finance and these have also become more commonly available to Thai nationals. The demand by Farangs has also increased pushing prices higher.
2. Local Mortgage Finance
In recent years local Thai banks have developed mortgage products which have become far more readily available to Thai nationals. These have also been expanded by some of the banks to allow applications by foreigners to be considered. However, before you rush off to the local branch of your bank please note that there are restrictions applied to Farang applicants for this source of finance.
In general terms those local banks which will offer such finance are limited in numbers. You will also only find foreign banks which have local operating licences offering such facilities. This is because a foreign bank may not have legal title to land and thus it must have a local bank licence status to enter this specific market sector. To my knowledge there is only one foreign bank with a local licence offering mortgages to expats here.
At present the rules being applied by the banks offering mortgages to expats say that you must have a current valid a work permit for Thailand and this must have been held for at least a year or sometimes two. So, if you are retired or if you do not live in Thailand but wish to invest, maybe for your future here, you are highly unlikely to be granted such facilities.
Mortgages are generally offered for a period of ten to fifteen years, with a maximum loan repayment completion age of 60, and at a loan to value (LTV) of approximately 60% of the property value. No interest only loans are offered so you must enter a repayment mortgage loan to be reduced to zero over a relatively short period.
Whilst there are no official figures as to the success rate of mortgage applications by Farangs it is generally known in the industry that of those who apply somewhere between 5% and 10% actually close as a current mortgage. This shows just how difficult it is to obtain this type of finance.
3. Owner or Developer Finance
This is a relatively new method being utilised and is often largely used for foreigners because of the difficulties they encounter when trying to finance a property purchase. The arrangement is simple and will encompass an agreement to purchase a property from a seller partly using instalments to pay the price.
With developers this has gotten more commonplace. They will tend to offer averages of say 25% of the purchase price to be paid over a period of say five years or more. Depending on the individual agreement this may be granted at a nominal or very low interest rate, which is attractive to the buyer. So, if you see a condominium project for sale and feel it would be right for you but you do not have all the finance in place there may be a way to arrange this with the developer.
Where this is a new development there may be some time between the purchase date and the project completion date. During this period you may have an opportunity to accumulate further resources for your purchase.
A private purchase may also use this method. Where the seller is an individual this may make the difference between a fast sale and a long wait for the seller to realise the transaction. It may also help you secure your property where you weren’t quite able to raise the necessary funding.
Be careful and make sure to have any agreement drawn up by a lawyer to ensure both parties are protected and have your own lawyer review this agreement to make sure it will be acceptable to you.
These are the first three methods of finance you can use to purchase a property in Thailand. They are not all encompassing and do not offer completely comprehensive solutions. Next week we will discuss the three further alternatives which are more popular with expats and with which they seem to have more success.
Questions to the author can be directed to PFS International on 02 653 1971 or email to enquiriesthailand@fsplatinum.com
This company, I beleive is based in Bangkok,
I hope this information is helpful to others
B.J elephant-027