Finance of condos and houses
Foreigners normally have no chance to get a property mortgage from a Thai Bank to finance a property purchase. This is not a law or a fixed rule, but the chances are extremely low and the bank requirements are extremely high.
If you apply for a mortgage or loan with a local bank they take your application friendly and with a smile, but the answer after a couple of weeks is (nearly) always the same : “Sorry, cannot…”….and you get your documents back. They will not tell you the reasons as well…..Often you will hear : …..”Sorry..decision in Bangkok..I do not know why…”.
The chance your mortgage will be refused is estimated to be higher than 98 %.
However, foreigners work in Thailand with a reasonable income and with a work permit more than 3 years have quite a good chance, if they can proof 50 % cash and a regular income on their bank account.
For a Thai national it is easier to qualify for a mortgage, but they need to proof as well, that they have regular income in Thailand. And it must be income to be shown on their bank acccount for the last 3 years. Income which is generated from abroad is not accepted.
You should be very careful if you are in contact with private mortgage agents. They often say, that they will get you a mortgage from a bank or a fund in abroad, but they are asking for an application fee of 50.000, 100.000 Baht or more. This application fee is not refundable, even if the mortgage is refused. And normally it will be refused.
However there are some other finance options available : Some sellers offer private finance options to the buyer of their property. Often the buyer has to pay 50 % in cash and the balance is to be paid in 2 or 3 years, interest free or with a low interest rate.
Also developers are offering finance options. However many people don’t consider that as real finance, because you pay just install payments during construction and then the balance when you get the keys.
All this however has a real advantage for an investor : In many tourist areas like Pattaya, Hua Hin, Phuket or Koh Samui the property market is influenced by foreigners. That means, that nearly all properties are paid in cash without any mortgage. Due to that there is never a pressure in that market like in other countries, where owners i.e. have to sell their properties fast, because they lost their job and now they cannot pay the interest for the properties.
This non existing risk in this market gives it a high stability, evidence of which was obtained recently during the last world financial crisis. Prices in Pattaya and similar markets did not drop during the crisis.