Believe that 'having a house' is one of many people's dreams when we start working and have our own income. One of the top dreams is having a home. But many people who still have limited income might have the following question: 'If the salary is still low but want to have a house how to make a loan through? '

Before we buy a house, we must assess our ability to pay first. The ability to pay in installments is assessed from the principle that "borrowers can bear the burden of installment of total debt up to 40% of income"

For example, a borrower with a salary of 20,000 baht will be able to pay off a maximum of 20,000 x 40% = 8,000 baht.

That means that if the borrower earns 20,000 baht per month, the house can be paid no more than 8,000 baht per month. Which we must not have other installment liabilities If we have other debt, such as a monthly car installment of 4,000 baht, the borrower will have the ability to pay the house down to only 4,000 baht (8,000 - 4,000 = 4,000) per month only.

Suppose you have no debt. If you have a monthly salary of 20,000 baht, your monthly mortgage payment ability will be 8,000 baht. In the next step, we must assess whether this ability to pay. What is the maximum amount that we should be able to borrow? (Which will be calculated from the installment period and home loan interest rates) as in the table

* Calculated from the average loan rate of 6.5% per annum. If wanting exact numbers, you can access advice from financial institutions that are interested in applying for a home loan.

Example of calculation in the table calculated according to the time value of money principle. It is the calculation of the present value of an annuity by calculating the monthly payment equally. 8,000 baht per month for 240 months (20 years) with an interest rate of 6.5%. How much is the lump sum currently worth? Will be the amount that we can borrow, can be calculated using the financial calculator or calculator application that has the function of calculating the time value of money (TVM Calculator).

When you see the loan amount You should find a house project that is in the amount that you can borrow. Currently, there are still projects that have a price of a million early. Located in many projects such as a condo in the suburbs or metropolitan area and second-hand houses in good condition at an affordable price. However, if the house project you aim for the price is higher than the amount you can borrow. That means you may have to prepare a lump sum. As a down payment as well. If there is still no down payment, must also plan to collect the money as a down payment as well

If it is considered that borrowing alone may not pass or not enough income. Joint recovery can be a solution. The co-borrower means the co-debtor, which in law, the co-debtor, is equally responsible for the debt unless otherwise specified. And in some financial institutions, co-borrowers must have relationships with borrowers as siblings, parents or the parents recover with the child, and the husband's recovery together with the wife. Or if married and not registered, co-borrowers also need to show other evidence, such as house registration showing that they are currently together. Or if having a child, must show birth certificate stating the name of the parents.

In the joint loan, financial institutions will consider the income of everyone who requests a co-loan by deducting everyone's expenses. After that see How much money is left to be able to pay in installments per month? And consider granting loans in proportion Which will allow co-borrowing Able to borrow more amount more reasonably.

Various payment history Yours is another factor in determining the credibility of financial institutions. Which if you have a good history Pay the debt on time and regularly. It will be a positive rating, making financial institutions easier to lend to you. Therefore, before considering a home loan, it should create good financial records. Should pay by installments on time to increase the chances of approval.

In short, despite the low salary but if there are preparation and good financial planning It will increase your chances of getting approval. However, home debt is considered a big debt. and has a long installment period. In order to not overburden, you should have enough income.

Article by: Nipapan Poonsatiansup,

CFP ^® Dependent Financial Planner