Can foreigners get real estate financing in Thailand? Can foreigners borrow money in Thailand to purchase a condo or villa?
Do you want to purchase a condo, villa or other property in Thailand? Are you looking for finance? This report will tell you everything about property financing for foreigners living in the Land of Smiles. Read more now on Phuket property for sale
Foreigners can now get property financing in Thailand. In the past, foreigners could not get a mortgage to finance a dream condo or pool villa on the beachfront. Most Thai money institutions only provided financing for Thais and Thai corporations.
In 2005, I was surprised to see Bangkok Bank PLC offering loans to foreigners at their Singapore branch. And in 2008, I was again amazed when I saw Bangkok Bank issue foreign loans through their Thailand-based branches.
In the past, mortgage lending from Thai banks to non-Thais was almost extraordinary. But recently I have noticed a significant change in policy to allow foreigners to access limited financing.
This initiative was initially launched to boost tourism in Thailand and stimulate economic growth.
Financing is a major consideration when we are looking to buy a home in our own country.
Financing is seen as an important way to smooth out our investments, regardless of whether you have the funds and liquidity available.
Financing is an important tool for people who have less access to financing. It allows them to buy the home of their dream.
In this case, Thailand is no different from other countries. Most banks in Thailand (but not necessarily all) provide loans to Thais for the purchase of real estate.
When buying property in Thailand, the similarities end here for foreigners!
Some Thai banks offer mortgage services for foreigners, but there are strict conditions that must be met by the foreigner.
The property must be registered in the name of the foreigner. This is because other types of property are not permitted for foreigners to own in Thailand.
The buyer is required to pay a minimum of 30% upfront, with the remaining 70% being financed for 3-20 years depending on age.
Only those under 65 can borrow money from the bank. The mortgage must also be paid in full by the time you reach 65. If you’re 55 today, you can borrow money for 10 year.
Bangkok Bank PLC, the first financial institution to offer this type of financing to foreigners in Singapore. In 2011, I met my first client in Singapore at the United Overseas Bank. They offered him a loan to buy his dream condo in Phuket.
Hey… The interest rate isn’t that bad. 5.25% per annum. If the loan is USD. If the loan is in SGD, then interest will be 7% per annum. Check their website.
UOB has a new scheme and they now offer this type of financing on the Thai Market with offices in all provinces.
HSBC, “The World’s Local Bank”, has also jumped on board. I recently learned that foreigners can also borrow money from other Thai financial institutions such as Siam Commercial Bank Kasikorn Bank Tisco Bank. It’s great news for the “farangs” of Thailand, isn’t it?
I have also noted that HSBC provides mortgages for all types of property in Thailand, not just condominiums. However, I assume that this is done on a case-by-case basis and regardless of whether the foreigner married a Thai citizen. I can imagine the Thai husband and wife and the foreigner would share the loan, and they will both own the property.
This is a much safer and better solution for the foreigner, than a 30-year lease agreement. When it expires, he no longer owns the property.
The bank will also ensure that the foreigner does not lose his home if he/she dies, as they want to make sure the foreigner continues to pay the monthly mortgage payments.
It is a good thing to see that there are now some banks competing (hopefully fiercely) in this niche. This will improve the foreigner’s situation in Thailand in the future as they try to beat each other with better rates. I welcome UOB and HSBC entering this niche market. Hopefully, this will be the beginning of a new era in financing for foreigners.