The Kingdom of Thailand and the island of Phuket continue to attract investors from all over the world with their progressive economic policies, while the incredible nature, climate, and hospitality of the local residents serve as the primary reason for many to consider relocating to the country of a thousand smiles. (read more in our article "Why People Buy in Thailand and Phuket").

The value of real estate, and especially land, is confidently growing, and naturally, a logical question arises for many buyers: is there an option for non-lump sum payments? Of course, we will delve into this issue in detail together.

An installment plan is a very popular option for purchasing an apartment or villa in Phuket. Almost all developers offer interest-free installments, but only during the construction phase and until the property is put into operation. When concluding a deal, a payment schedule is stipulated in the sales contract, which is usually tied to the stages of construction.

First option: Installment plan

An installment plan is a highly popular method for purchasing an apartment or villa in Phuket. Nearly all developers offer interest-free installments during the construction phase, which lasts until the property is operational. The payment schedule, which typically aligns with various construction milestones, is outlined in the sales contract.

For instance, consider purchasing a studio priced at 3,571,440 baht in a boutique condominium built by a reputable developer. The property is expected to be operational by December 2024. In this case, the payment schedule would be as follows:

• Reservation deposit: 150,000 baht
• First payment: 35% (1,250,004 baht) due within 15 days
• Start of construction: 20% (714,288 baht)
• Buildings erected: 20% (714,288 baht)
• Completion of finishing work: 15% (535,716 baht)
• Transfer of ownership: 10% (207,144 baht)
• Total: 3,571,440 baht
• (For a detailed profitability analysis of this apartment, refer to our article "TAT and Airbnb: Revolution in Travel and Digital Nomads")

Additionally, developers often provide the option to create a personalized payment schedule. While rare, some completed properties offer installment plans that last up to 3-5 years, featuring progressive interest rates over a five-year period. For example, The Proud V, a condominium located 70 meters from the Rawai waterfront, has a ready-to-move-in project that offers a 5-year installment plan. The interest rate is variable and depends on the specific purchase option chosen by the buyer.

Second option: Mortgage

In contrast to an installment plan that you can obtain from a developer, a mortgage must be approved by a bank.

Question: Can a foreigner apply for a mortgage on real estate? In short: yes, but there are nuances.

• You need to officially work in the country, have a stable income (salary should be at least 3 times higher than the monthly mortgage payment) for a minimum of 1-2 years
• Only for purchases in freehold (more details in our article "Forms of Ownership in Thailand")
• And even in this case, the requirements and interest rates will be higher, and the mortgage terms will be much shorter for a foreigner compared to a local resident.

Many banks are updating their mortgage policies for foreigners, so it makes sense to periodically check for changes (until 2016, Bangkok Bank offered such an opportunity). At the moment, UOB Bank stands out as still offering the possibility of a mortgage.

Exception. The Thai credit organization MBK Guarantee provides mortgages secured by real estate for up to 10 years. The property that can serve as collateral must be located in Bangkok or resort provinces.

In Summary

It's clear that interest-free installments from developers are more popular, as there's no need to meet specific criteria, work in Thailand, verify income, prepare a list of documents, credit report, or bank statement. Overall, there's less of a headache, since all that's required is a copy of your passport :)

Do you have any questions?

Feel free to write or call us on social media and we will gladly provide you with a free consultation on all your questions ⬇️

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