CAN FOREIGNERS GET A PROPERTY LOAN IN THAILAND?
If you’re a foreigner looking to purchase property in Thailand, you might be wondering if you can get a loan to make your dream a reality. Unfortunately, it’s difficult for non-Thai citizens to secure a bank loan in Thailand, with most financial institutions restricting loans to locals. However, some banks like HSBC, Siam Commercial Bank, and Thai Military Bank offer loans to foreigners, but there are strict criteria to meet.
To be eligible for a loan, foreigners must hold the property in their name, which limits them to buying only condominiums. Moreover, the property must be registered as a condominium under the Condominium Act, which means loans for land or houses are not possible.
In addition to local financial institutions, foreigners can explore international home loan schemes offered by banks such as Bangkok Bank and United Overseas Bank (UOB). These schemes allow foreigners to purchase property in Thailand, even if they don’t live there. Bangkok Bank offers up to 70% financing, while UOB allows customers to apply for a loan in Thailand, without the need to travel to Singapore for an interview. Both banks have similar interest rates, but UOB’s administration fee is slightly higher than Bangkok Bank’s.
To be eligible for a mortgage, foreigners must meet certain criteria, such as providing proof of stable employment, a work permit or Thai resident permit, and proof of income. The repayment period and the applicant’s age combined cannot exceed 60 years, and the fixed income must be at least three times the monthly repayment. The total amortization period of the loan must exceed 7 years.
Foreigners must also provide other documents, such as copies of their passport, visa page, identity card or government official identity card, marriage certificate (if applicable), bank statements, land or unit title deeds, and sale and purchase contracts.
It’s important to note that every bank has its own individual policies, and interest rates depend on specific offers at the time. Banks have their own valuation process to determine the fair market value of the property.
Finally, protection under Thai law for mortgages is covered by the Thai Civil and Commercial Code, Section 702. To qualify for protection, the right of ownership of the property must lie with the mortgager, and the mortgage contract needs to be in writing and registered. The mortgage for land with a title deed must be registered at the Land Department, Bangkok Metropolis Land Office (Branch), Provincial Land Office or Provincial Land Office (Branch) where the land is situated. The mortgage for land with no title deed must be registered at the District Office where the land is situated (e.g. a Nor Sor 3).
