Last time we talked generally about home finance, focusing mostly on the terms of the loan and what it is legally required to include. This time we'll concentrate on mortgages.
In Thailand, mortgages are contracts between lenders and owners of property to secure lending and are the way a bank ensures borrowers pay back loans. If a borrower doesn't pay, of course, the bank will foreclose the mortgage and the property will be sold at public auction.
The law of mortgages contains a few points that will help you understand the way financing is offered to foreigners. A mortgage must be in writing, for example. The mortgage must also state the sum owed or a maximum amount for which the mortgaged property is assigned as security. Finally, it must designate exactly the property it covers and be registered at the proper land office. The existence of the mortgage is noted on the back of the title deed that is kept at the land office. Before you sign anything, a lawyer or other expert in mortgages should review and explain the document to you.
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