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Credit Cards and Mortgages in Thailand

Transcript of the above video:

This video today is going to briefly discuss the issue of credit cards in Thailand and mortgages in Thailand. I'm going to kind of bundle this all together in one. There will probably be a bit more information about mortgages but it all seems to kind of be inquired about in the same vein when people ask me a question about this stuff.

We are getting into topics that aren't strictly speaking of sort of a legal or an immigration nature but more about just sort of living here and the other is the information pertaining to the mortgages and credit cards are bank policy specific, not so much overly dependent on sort of the legal frameworks or anything here. So be sort of aware that this is just kind of an overview and if you have any questions or you need any information on specifics of this stuff probably even somebody like me is not someone to ask. You are going to want to check with banks specifically to see what their policies are regarding foreign nationals; specifically I'm talking about foreign nationals who want a credit card or a mortgage here in Thailand. So to sort of preface what we are talking about here, some of the expats who have been in Thailand for a fairly long period of time will probably think that this next statement is somewhat amusing because it's sort of self-evident I guess but it bears repeating. Thailand is something of a, I would argue no more nationalist than most other countries around the world, but it's notable to many expats who come here or it's noticed heavily by many expats who come here that “yes under the law and the banking rules and everything, foreigners are treated pretty differently compared to the way Thais are treated under certain circumstances”, and this is very, very evident when it comes to banking.  For a brief moment it should probably be explained why. I have had many folks I have dealt with over the years have become rather frustrated with the Thai banking system because they say “I have to bring in umteen million documents every time I do anything with respect to banking”. The reason for that is, is Thais are providing no less information then farangs, foreigners here in Thailand, are providing when they are dealing with their bank. The difference is the Thais have a Thai ID card and all of that information, much the same as what we foreigners are providing every time we are going to a bank to deal with some matter, all of that is basically dealt with on that Thai’s Thai ID card, on that Thai National’s Thai ID card. Whereas for us, it can look like a phone book under certain circumstances, depending on what you are trying to do at a Thai Bank. So just be aware that you might want to go ahead and step back and be aware that this frustration is probably more due to the way the system doesn't really have the same mechanisms for sort of collating the data that banks need in order to deal with banking matters for individuals doing business or personal banking here in Thailand. Getting specific to mortgages and credit cards; let me go through credit cards real quick because I have people ask. I did a video previously about bank accounts and I had people turn around and ask me, “Well, what about credit cards?” Specifically with credit cards, it's been my experience that is not impossible to get a personal or in some cases a corporate credit card for a farang, be they in a corporate capacity or in a personal capacity but in virtually all of my experiences where that has been an issue, the banks required in some form fairly significant guarantee almost like collateral, for lack of a better term, before they were willing to issue a credit card. So it's quite different from say the United States or perhaps in Western Europe or in the Commonwealth, where one can, I'm not going to say you can just walk in and get a credit card willy-nilly, but it's a fairly straightforward procedure and it's not very difficult for people from those jurisdictions to get a credit card, at least in my experience it hasn't been. Over here, it's a little bit complicated with respect to documentation and also you know as I said requirements, money that acts as a guarantee, essentially collateralizing that credit card, so just be aware of that.

The issue of collateral and the issue of sort of money up front before any type of credit is going to be issued comes up again with respect to mortgages. It's been my experience, my wife has mortgaged things in the past, I've seen other individual Thais that have mortgaged things in the past.  Essentially, the mortgage system for a Thai National in Thailand looks much the same minus the fact that it's all going to be written up, drawn up in the Thai language. It operates much the same as I've seen it operate in the West for the most part at least on a consumer level. Again when you bring the foreign national element into that equation the calculus does kind of change. Again some of it comes from the issue of documentation, where foreign nationals don't have the same sort of “magic card” that just has all their info on it, right then and there.  So that's one issue. You bring in whole stack of documentation which  can take time to put together and the other thing with respect to mortgages, it's been my experience that I don't think that you're going to get a mortgage for much over 40% of the underlying appraised value of whatever property you're talking about. So again having at least a bulk of the money as a foreign national to get a mortgage here in Thailand, and not all banks do this for foreign nationals. It's been my experience that there are a select few banks that have such programs and they can also change from year to year, month to month, so again it's probably going to behoove the viewer to go ahead and look up sort of banking information that kind of thing on their own or if you contact us and we can help you talk to the bank and figure something out. It's been my experience that in issues pertaining to mortgages, you're going to have to put a pretty sizable percentage of the underlying value of the property you're looking to buy. It's not going to be a situation where you can put nothing down or 10% down or even 20% down; you're going to be looking at a significant down payment. But that being said, in limited circumstances, credit cards and mortgages are a possibility for those wishing to do business over here in Thailand, or living over here in Thailand, but as it sort of goes with the expatriate experience, doing things overseas at often times it's more time-consuming and resource intensive than doing it in one's own country.