Real Estate Property Investment in Thailand
Thailand Investment Property Financing – Frequently Asked Questions
What are the Property Types you Should Invest
- Commercial / Business (Hotel, Bar, Restaurant)
What are the obstacles of purchasing property in Thailand?
Local laws regarding the ownership of land in Thailand restrict foreign investors on options available, this is a fact.
Many Lawyers and Solicitors agree that there are ways and means to overcome Thai legislation of owning your real estate property and it is recommended to seek advice from a reputable company.
How many options are available to fund a Thailand purchase?
- Local Thai Bank Finance
- Asset Finance
- Remortgage of existing property
- Hedge Fund
What is Local Thai Bank Finance?
Visiting a local retail bank in Thailand and requesting a mortgage to purchase a real estate property in Thailand.
What is a Mortgage?
Traditionally a mortgage means the lending of money from a bank, upon transfer of security in the form of property.
What is a Re-Mortgage?
Traditionally a Re-Mortgage is the same as a Mortgage although, the aim is to move from one bank to another in favour of a better interest rate or, allow a release of equity on the property.
What is Asset Finance?
Traditionally Asset Finance means the lending of money from a bank, upon transfer of security in the form of a low risk investment.
What is a Hedge Fund?
A Hedge Fund in this form is a collection of investors who have pooled money together and will lend money back as a normal bank would lend in expectation of a return on investment in the form of a loan margin as a normal bank expect.
What is Equity Release?
Traditionally equity release is when you borrow money from a bank and provide security to a bank in the form of your property. E.g. your house is worth USD500,000 and your outstanding mortgage is USD100,000. You would like a loan of USD150,000, which would allow you to purchase a Thai Property for circa THB5,000,000. You Re-Mortgage your existing property and now your house is worth USD500,000 with a loan of USD250,000 & you now additionally own a Thai property.
What is a Loan to Value or LTV?
A bank when lending money will usually work on a “loan to value” or “LTV” ratio which means they will lend for example, 70% of the purchase price or valuation. This reflects the risk your bank takes in lending you the money so if the bank needs to liquidate the asset, should property prices have fallen since the loan was established, a sale of property would hopefully be enough to pay back the loan.
What does Unencumbered mean?
In terms of finance, this would mean holding a property without a mortgage or debt secured against it. i.e. Property is worth 300,000 and you have no loan to pay off.