Research on various types of loans available to foreigners in Thailand

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Do you need a loan?

As a foreigner living in Thailand, you are probably curious about your options. Obtaining a loan as a foreigner in this country is not that simple, but it is possible. Under the guidance of interest in economic development and promoting tourism, the local government is taking significant steps to facilitate access for foreigners to financial support. But what kind of loan can you, as a foreigner, obtain? Here are some of the main options.

1. Personal loan

Certain banks in Thailand offer personal loans to foreigners. A personal loan is an amount of money that you borrow from a bank, credit union, or even an online lender. You will then need to repay this amount in fixed monthly payments. You can choose the terms of these payments, which usually range from 12 to 84 months. However, keep in mind that these payments typically come with additional interest. So, what can you use a personal loan for? The answer is simple - almost anything. Whether it's debt consolidation, funding a home renovation project, paying medical bills or other emergencies, or covering expenses for a wedding or vacation, a personal loan can be your vital support. Personal loans are not just about getting immediate financial help. They can be more beneficial if used strategically to achieve long-term financial goals. Suppose you want to improve the appearance and comfort of your home. A loan can easily finance your home improvement project, which, in turn, can increase the value of your property. On the other hand, if you have debts, a consolidation loan will allow you to pay it off at a more favorable interest rate. Simply put, personal loans in Thailand can be a great option for mindful borrowers due to their fixed interest rates, standardized payments, and clear terms, making them understandable and predictable. However, before taking one on, it is always wise to study the terms and ensure that you are getting the best deal.

2. Auto loans

Auto loans are another accessible option for foreigners in Thailand. It is noted that banks such as Krungsri and SCB offer auto loans specifically designed for foreigners. Here’s what you need to know about obtaining an auto loan: for your first car purchase, you will need a Thai guarantor. This can be a friend or relative, but they must fully understand the consequences if you are unable to repay the loan. However, if you are buying subsequent cars and your loan is from the same source, this guarantee is not required. An exception to this rule is when you make a deposit of 50% to 70% of the car's value.

3. Mortgages

Obtaining a mortgage as a foreigner in Thailand can be quite challenging. However, despite this, some banks offer mortgage programs for foreign citizens in Thailand. Several international banks, such as UOB, HSBC, and ICBC, which have branches in Thailand, provide loans to their clients through their foreign subsidiaries. Nevertheless, keep in mind that ICBC typically issues loans only to individuals of Chinese nationality and to those from certain groups of countries, such as Singapore and Malaysia. The introduction of a new financing service by the Singapore branch of Bangkok Bank in mid-2005 significantly simplified the mortgage process for foreigners in Thailand. They began offering overseas financing to foreigners wishing to purchase property in Thailand. Even foreign citizens who are not eligible for local loans were granted up to 70% of the property's value. This move opened the door for many potential property owners to finance their Thai properties, even though they do not reside in Thailand. Today, the demand for such loans from Bangkok Bank in Singapore continues to grow. They offer loans in various currencies, including US dollars and Singapore dollars, at an interest rate of the prime rate plus 0.5%, which amounts to 8.75%. However, be aware that the bank may charge an application processing fee and insists on a personal meeting with applicants, which usually means a trip to Singapore. United Overseas Bank (UOB) of Singapore also offers similar lending services to foreign citizens purchasing property in Thailand. The terms for UOB's international loan currently mirror those of Bangkok Bank, providing welcome competition in this market niche.

4. Credit cards

Credit cards have become an easily accessible form of credit for foreigners in Thailand, likely due to less stringent criteria compared to other types of loans. Many well-known banks offer credit card services to foreigners who meet the necessary requirements. The main banks providing such services to foreigners include Kasikorn Bank (KBank), Siam Commercial Bank (SCB), Krungsri, and UOB Bank, among others. It is important to note that the ability to obtain a credit card as a foreign citizen in Thailand largely depends on your salary. Banks assess your income and recommend or issue a credit card that corresponds to your financial situation. Want to know how to apply for these loans? Check out our guide on how foreigners can obtain a loan in Thailand.