Check which bank is best for these 4 occupational groups.
Owning your own house, whether looking for a condo or deciding to buy a house, requires a large sum of money. Few people have the cash ready to pay for a house that costs millions of baht. Most need to apply for a mortgage from a bank. When applying for a mortgage, you will be vetted in several ways to assess your ability to repay.
Of course, the main scrutiny includes income, expenses, existing debts, and the possibility of incurring future debt (credit cards) to gauge your ability to pay mortgage payments. Next, a credit bureau check for the past 3 years is conducted to see if there is a history of defaults, ensuring the borrower has financial discipline.
But another crucial factor for banks to consider is the borrower's occupation. Occupation indicates the stability and consistency of income sources. If income is unstable and high-risk, the bank may consider that even with good income today, an uncertain future could cause problems with paying off a mortgage over 10-30 years.
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Opportunities for 4 occupational groups to obtain mortgage loans:
1. Civil servants and state enterprise employees
Congratulations! You're the type of person banks want. Government agencies offer high job security, and the chances of being dismissed are relatively low. This will also ensure stable repayments, increasing the chances of loan approval.
In addition, civil servants often receive special home loan packages with lower interest rates than other professions from state banks such as the Government Housing Bank (GHB), as follows:
1) The GHB-GPF Housing Project for Civil Servants, Phase 16, with a budget of 1 billion baht, for civil servants who are still in service and are members of the Government Pension Fund (GPF).
This is for those who need loans to buy, build, renovate, expand, repair, purchase vacant land that is an NPA (Non-Performing Asset) property of the bank, redeem from other financial institutions (refinance), pay off housing-related debt, pay off debt with refinancing, and purchase related equipment or amenities for residential purposes.
Interest Rates:
• Year 1: 0% per annum
• Year 2: 3.25% per annum
• Year 3: 4.55% per annum (Average interest rate for the first 3 years: 2.60%)
• Years 4-5: MRR-2.00% per annum
• Year 6 until the end of the contract: MRR-1.25% per annum, except for debt consolidation/equipment purchase loans, which are at MRR (The current MRR interest rate of GHB is 6.545% per annum)
For a 1 million baht loan, the initial monthly payment starts at only 4,400 baht.
2) Housing Loan Project for Government Personnel 2025: A budget of 40,000 million baht for civil servants, government employees, university employees, state enterprise employees, government officials/staff, and permanent employees who are eligible for loans according to the definition in the agreement of the housing loan welfare project for non-deposit-based loans from the bank.
For those who wish to borrow to purchase, build, refinance, renovate, expand, repair, or consolidate housing-related debt. Debt refinancing and purchase of related equipment or amenities for residential purposes.
Interest Rates:
• Year 1: 2.50% per annum
• Year 2: 3.25% per annum
• Year 3: 3.75% per annum (Average interest rate for the first 3 years is 3.17% per annum)
• Years 4-5: MRR-2.25% per annum
• Year 6 until the end of the contract: MRR-2.00% per annum, except for debt repayment/equipment purchase loans, which are at MRR rate.
For a 1 million baht loan, the initial monthly payment starts at only 3,300 baht.
Therefore, civil servants should not forget to study the packages from state banks like GHB, which helps make home ownership easier for civil servants.
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2. Private Sector Employees with Regular Income
Private sector employees with regular income are another group that banks consider a low-risk group for home loan approvals. Even though there's a chance private sector employees might have their salaries reduced, be laid off, or their companies might close down, they usually don't have debt from their businesses. This results in lower risk and a higher chance of loan approval.
Private sector employees can look for loan packages from all banks and compare their value.
Furthermore, some private organizations have welfare agreements with state and commercial banks, allowing employees to receive better interest rates than regular customers. These organizations also sometimes subsidize some of the interest payments for their employees.
Therefore, please check your organization to see if they offer employee welfare benefits for home loans.
Here are some examples of home loans for private sector employees:
1) The GHB Home for You Project 2025, with a budget of 60 billion baht, is for general customers with a gross income not exceeding 35,000 baht per month and no prior history of housing loan repayments with GHB.
This is for those who need loans to purchase, build, refinance, renovate, expand, repair, or repay debt with refinancing. The maximum loan amount is 3 million baht per individual per collateral.
Interest Rates:
• Year 1: 3.50% per annum
• Year 2: 4.25% per annum
• Year 3: 4.55% per annum (Average interest rate for the first 3 years: 4.10%)
• Years 4-5: MRR-2.00% per annum
• Year 6 until the end of the loan term: Welfare customers: MRR-1.00% per annum, Retail customers: MRR-0.75% per annum, Loan repayment: MRR
For a 1 million baht loan, the initial monthly payment starts at only 4,700 baht.
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3. Self-Employed (Freelancers)
Whether it's small-scale trading such as noodle stalls, market stalls, online sales, or even freelance work, these are the riskiest groups for loan approval because their income sources are easily affected by economic conditions. Even though many SMEs have higher monthly incomes than typical salaried employees, they are still considered to have unstable occupations.
One of the challenges for self-employed individuals is the limited financial documentation they often provide. They frequently receive cash payments and don't consistently deposit them into bank accounts, lacking clear records of income and expenses. This makes verification difficult for banks.
However, despite being considered a high-risk group, banks don't necessarily reject home loan applications outright. Applicants can contact their preferred bank for advice on preparing their loan application. Generally, banks will request proof of income, such as withholding tax certificates or Form 50 Twi.
For freelancers receiving payments in installments, proof of income for the past six months, annual tax returns, and bank statements showing regular deposits for the past six months are recommended.
So, which bank is best for self-employed individuals to buy a house? Some banks offer assistance to this group, even if they haven't prepared the necessary documentation beforehand. For example, the Government Savings Bank (GSB) has branch staff who can advise on maintaining bank statements to demonstrate liquidity for six months and recording income and expenses as supporting documentation for loan applications.
Therefore, self-employed individuals should check the requirements of each bank and be prepared with more financial documents than those in other professions.
Here are some examples of home loans for self-employed individuals:
1) The S-em (Self-employee) Home Loan Project 2025, with a budget of 5 billion baht, is for self-employed individuals or small business owners such as traders, taxi drivers, or employees who do not have a prior history of repaying housing loans with GHB.
For those who wish to borrow to purchase, build, refinance, or repay debt with refinancing, the maximum loan amount is 3 million baht per individual per collateral.
Interest Rates:
• Fixed 3.75% per annum for years 1-5.
• MRR-2.40% per annum for years 6-10.
• MRR-2.00% per annum for years 11-15.
• MRR-0.75% per annum for years 16 until the end of the loan term.
For a 1 million baht loan, the initial monthly payment starts at just 4,400 baht. Special offer! Free collateral appraisal fee: 1,900-2,800 baht
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4. Special Occupations (Specific Professional Groups)
Special privileges are offered to those with high job security and relatively good to very good incomes. Many banks offer special low-interest home loan packages to attract professionals related to the "medical field." Related occupations include doctors, dentists, veterinarians, and pharmacists. Some banks also include physiotherapists and medical technicians.
In addition, some banks include other professions on their list of special occupations, such as commercial pilots, judges, prosecutors, and university lecturers (assistant professor and above), who can also benefit from these privileges.
Examples of home loans for professionals in special occupations (specific professional groups) include:
1) Krungsri Bank Home Loan for Special Occupations:
Home loan for doctors, veterinarians, dentists, pharmacists, judges, and commercial pilots.
Fixed interest rate of 1.99% for the first year.
2) TMB Thanachart Bank Home Loan for Doctors and Dentists:
Special interest rate averaging only 3.30% per annum for the first 3 years.
Maximum loan approval of 100% or up to 50 million baht.
Free! Property appraisal fee - Fire insurance premium
Comfortable monthly installments, up to 35 years
Interest rate for the entire contract: 4.94%-5.30% per annum
3) Kasikorn Bank Professional Home Loan
Home loan for doctors, dentists, pharmacists, pilots, judges, and prosecutors
Special interest rate of 1.99% in the first year, loan amount up to 90%
4) Siam Commercial Bank Professional Loan
For doctors, dentists, veterinarians, pharmacists, judges, prosecutors, and university professors at the assistant professor level or equivalent and above
Fixed starting interest rate of 2.55% for the first year (only for customers who purchase Credit Life insurance)
Interest rate discount (when purchasing Credit Life insurance according to the specified conditions)
Loan up to 100% of the collateral value based on the appraised value or the purchase price in the land department's sales contract, whichever is lower. For first-time homebuyers with properties priced under 10 million baht (Contract 1):
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It can be seen that most home loan packages offer lower interest rates for those with specific occupations. Therefore, individuals with specific occupations can check the home loan packages offered by the various banks mentioned above to find the best option.
However, each bank has different lending guidelines and criteria. When considering which bank to borrow from, it's crucial to consider your occupation and match it with the right bank to maximize approval and the best interest rate.
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Thank you for the valuable information from DD-Property.
