By MEDI ZIA
“HOW do I get a loan for my dream home?” an Italian man, who was with his pregnant wife, asked me.
He wanted to buy one of the beachfront homes we had developed in Big Buddha. He wanted to know if it was possible for a foreigner to get a loan to buy a property in Thailand.
I told him he could apply for a loan from a Thai bank but that there are some restrictions involved for a foreigner to qualify for a home loan.
First you have to know if you want to buy the land on which the house sits. Then, you will need to open a company with a Thai partner with a 61 percent share. Or you can lease the property registered in your name for 20-30 years. This is legal and much cheaper than renting a home—you won’t need any Thai partner, and you can even profit by reselling it, especially if the location of the property is good.
Roadside and beachfront properties go up 5 percent every year so that in 10 years’ time you could get a profit of 50 percent more than you paid.
If you need loan from a Thai bank, you have to apply in the name of your Thai spouse.
If your spouse is unemployed or a plain housewife, you can act as the guarantor, paying for the monthly bank installments.
A foreigner must have these qualifications:
- Has a Thai spouse or family in Thailand (should have a marriage registration and use Thai name to apply for the loan.)
- Has a stable job and steady income.
- Has a job or business in Thailand. Work permit must be over one year.
- Has lived in Thailand for a long time or plan to live for the long term.
You can apply for a loan less than 50 percent of the selling price. If you need more than 50 percent (perhaps 60-70 percent), you should have a high and stable income.
Moreover, installment payment plan can only be short term, such as five or 10 years.
As you can see, it is possible and the interest rate is 6-7 percent.
If you have no source of income, it is better to buy a shophouse and have a business plan or someone who rents the shop from you and gives you income, since a bank needs guaranteed income source to approve your loan.
You will need a tenant to show that income. You can also ask the seller or the developer of your dream home for financing for three to five years until you can resell the home with profit or get refinancing from your local banker.
By that time you will have a track record of paying on time.
Try to sell the property from the first day you move into the house, you will find a buyer in three to five years, and if your location is good, you will make good profit, which you can use for your next investment and have smaller monthly payment for the next house.
Keep repeating this process until you can pay for your dream home in cash.
For questions, visit http://beachfrontapartment.blog. com or e-mail me at
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