As we now near the end of 2020, I am sure many will be pleased to see the back of this year.

From the word go, the year has been thwarted month after month with new challenges and the world still seems to be Covid stricken. Fortunately, Thailand in comparison with other countries appears to have fared well “from the view of reported case numbers” however, a country which had a high volume of tourists, which many businesses (both local and foreign-owned) would have been reliant upon, have struggled immensely with many now out of business or work altogether.

The hotel and tourism business had been particularly hit hard, though not of course the only market segment by any means! In some of the more prominent tourist areas, the word “Ghost Town” is often overheard. Strict quarantine measures which are essential in the views of “some” are required, in order to enter the country via flights, and whilst being utilized the numbers are minimal; it is for those who “really” need to be here. For those that live here, it could be a case of knowing that if one leaves, it is highly unlikely one would come back again until the measures ease off, i.e. one-way tickets.

The Mortgage & Kai Faak Finance business has also seen its challenges along the way. Perhaps unknown, as a lender we also stemmed the flow of new business for a period whilst Thailand went through a period of lockdown measures with hotel & shopping center closure orders. Without any incline at the time as to how long or when closures would be required until a change of thought to capital preservation would have been needed in order to wade through such times. A work from home measure was introduced for all staff and uncertainty encroached upon us all.

The main focus for some lenders during such a time may have shifted from lending new businesses to helping existing good clients get through such testing times and being more lenient on the contract. Being the first time for such a black swan event, of course, things would likely not go smoothly as avenues of income which one may have thought feasible before, could have dried up altogether, along with the ability to repay a loan installment. Putting food on the table and health of the family for some could have been a priority.

Another key point to consider would have been that land offices were closed for a short while due to the spread of Covid numbers, this meant no new transactions were possible. Without the ability to help by making a new loan contract at the land office, existing contracts would need to have been reviewed to see what could be done legally within the existing contract realms to make things easier.

On top of that of course, typical existing loan amendments would usually have been signed together between a lender & borrower face to face. With many stranded overseas unable to get to Thailand, some being stuck in places they don’t normally live OR even some stranded in Thailand itself unable to leave home & return back to their usual place of work due to no flights or quarantine measures, the old idea of meeting people face to face went pretty much out of the window and off for a Burton.

For many, people are still in the same predicament. How then, would a lender be able to assist in amending contract terms in order to relieve installments for struggling clients, when living overseas and/or stranded…?

A new way of thinking would be to allow existing performing clients that are known to a lender for a while to sign overseas and make a video of themselves doing such signing and to state particulars within the VDO and then courier paperwork back.

Where possible it could be preferred to obtain a Thai Consulate Stamp if near to their hometown or, obtain some form of public notary confirmation. An issue with the stamp however is that consulate services and non-essential workers had also been stopped therefore, a notary stamp would likely have been impractical for many unless you had a “friend” and didn’t mind the risk of Covid. If after having emailed a copy of the contract and successfully signed the paperwork in accordance with lender requirements, the next issue to stumble on would be mail. Courier services in some countries had stopped due to no flights. I had one instance where we tracked a couriered document to an airport in Melbourne Australia, and then, it sat there for 2 months. Usual contract approvals may last for just 1 month therefore, having a document sat in an airport for 2 months doesn’t help matters either.

One other obstacle to using a courier was when sending to a PO Box address. As the usual office address may have been in a tower above a shopping center (which had been ordered closed), to what address would a client mail paperwork… A typical courier requires a person to sign upon receipt of any mail and may refuse (as often did) to send to a PO Box address therefore, on occasions, mailing to a senior management staff home addresses could have been a final last resort option. Of course, if the staff was working from home also then how would legal staff get to see the original to verify when paperwork is at another staff member’s house…! In a nutshell, it is clear that a paper trail requirement is not practical if such circumstances were to become the new normal. A secure digital way of doing business certainly had been highlighted requiring a digital ID verification on a global scale (assuming life continues to be global). Imagine where a company could do business from Thailand with someone living in Australia (for example) and some kind of digital verification tool was in use to 100% verify the legitimacy of the actual borrower and lender. The paper would become a thing of the past which would be great for trees and the health of our planet too of course.

As we near the end of the year, life seems to have settled down a little in Thailand (with regard to reported Covid numbers.

The longer-term economic effects of this economic downturn are yet to be weighed and measured, for sure; many will continue requiring support into the coming years ahead.

Those who initially required help for their finances earlier in 2020 are likely to continue needing for the future, as those would often be in businesses that shall likely not pick up anytime soon. Selling a property now in order to pay off the loan is likely to bear little fruit or return little profit. If anything will be at a loss against the initial purchase, unless, the initial purchase was shrewd enough to begin with.

Demand from purchasing at the moment is heavily weighted into the Thai segment which often means, is being bought at a huge discount compared to usual. Few would pay full market value during a global economic downturn…Selling at a loss is unavoidable for many, however, particularly as the scale of such a global shutdown happened so fast. The average property owner likely saw rent requests drop off or, even existing tenants asked owners to halt rent payments due to zero chance of doing anything about it being quarantined indoors. I recall governments asking property owners to help provide relief were required also.

Residents living in Thailand certainly would feel a lot more of a quieter environment than pre-2020. Positives can always come from bad situations. One cannot help but notice a cleaner environment, less polluted waters, and beaches of cleanliness. The air feels and looks less hazy (although to be fair it’s not field burning season), roads during a typical, heavily congested rush hour are safe to cross with little traffic, main roads with overloaded overhead cables are easier to replace with underground cabling causing fewer traffic issues and better connection speeds. Ideally, once the beginnings of a fresh look Thailand comes up for air, we shall all, be better able to cope with life challenges and help restore economic recovery as a whole for everyone.

At MBK Guarantee Co., Ltd, we offer Mortgage finance on Thailand based property with popular equity release and cashback available. We take security over the property and provide cash for you to utilise as you please. Our interest rates are typically around 8.87% for condominiums and 12% for most other types of collateral. Up to 10-year term or age 70.

For further information on how to “Finance Property, Land & Condos in Thailand”, or a web-link to the “Thailand Condo Finance Map” which shows pre-approved condominium projects for finance, please feel free to email [email protected] OR, call 66 (0) 81278 5382 OR, Line ID stuartmaxwellfoulkes, I shall then be happy to assist.

To speak with a native Chinese national, contact Rose on 66 (0) 95648 2913 or WeChat: rose215620 or email [email protected]