It could be helpful to clarify this part a bit:
First off, there’s a huge difference in the amount of down payment needed for a new house vs used. Used houses require 30% down, that’s pretty big IMO. New houses/apartments only require 10% down. The building company finances the mortgage.
I think you can categorize houses into three categories:
- Used (i.e. not new construction)
- New construction
- Pre-construction
For 10% down and company finances the mortgage, do you mean new construction or pre-construction?
I recently bought a new construction home, but my credentials are a NWOHR passport and TARC (will create a separate post about it in more detail later) and buying without being married or having a partner in the mortgage. That said, I learned some things that may be useful to everyone on any type of resident permit:
- In general, banks prefer a permanent resident ARC rather than one with an expiration date. Duration within the country and whether or not a work permit is in the mix also matters, I think.
- Some construction companies can help you with financing, but not sure if all will. Most construction companies have a specific bank they partner with, I believe. In my case, the bank that partnered with the construction company did not offer mortgages to people with any type of resident permit.
- You don’t necessarily need to be married to a local or have a guarantor （I mean 保證人 – not sure what the best translation is for that）, but it can help with many cases and many banks prefer it. Actually I’m thinking you may have been able to have your wife (if you had been married at the time) or someone else act as the guarantor/保證人 and kept the house in your name, if you talked to some additional banks or asked the bank about this method. I’m not completely sure, but just wanted to mention it as an option for other people to check out.
- A guarantor/保證人 often needs to themselves have enough financial qualifications to handle some level of risk related to being the guarantor of the mortgage in case some issue happens. Different banks have different criteria for this role, but it’s usually required to be a direct relative who is a full citizen of Taiwan.
- The rate you actually get can be based on various factors, and I think mostly comes down to what the loan reviewer/manager/officer is willing to dish out after checking your specs. I think also how available you are to answer their questions via phone and how well you answer them matter, based on my experiences applying at a few banks.
- Another consideration is where your income is from – local, or overseas. If some or all is overseas, you’ll need to prepare some documentation and not all banks are able/willing to review that information since it’s from another country and usually in another language.
- One bank told me they just won’t deal with mortgage loans to foreigners because too many people bailed on them or had issues. You may need to talk to many banks or loan salespeople to find one who will work with your case and particular aspects.
- I ended up getting a loan for 80% with a 20% down payment at 1.63% (but I got some cash back via a special discount from the construction company) – originally I was told maybe I could get lower, like 1.56%. People considered this to be a little “high” based on my stats, due to being on a TARC and having all of my financial info overseas, but for me this seems ridiculously low compared to other countries. The income you can prove can also matter, of course, as well as other financial details. How much the house costs also probably matters in both what amount you can get the loan for and what interest rate, of course.
- I have to say, this sounds great but this was after talking to several banks and hitting a lot of dead ends and problems.
- Another thing to watch out for is when you sign the purchase contract to go into a purchase agreement with a seller, they may have a clause about penalizing you if you back out of the agreement. This can be a problem if you agree to buy a house at the higher end of your purchasing range, and then you can’t get a loan to cover it. It can get a little stressful if you run into this case. Be sure to review purchase agreements carefully and talk it over with experts if needed, or ask to have agreements changed/amended before signing anything if you feel like you need the safety. The penalty can be steep in some cases (i.e. the entire down payment amount), and I’m not sure to what extent they are enforceable.
- Note that you don’t truly know what offer you will get until you apply and go through the process. What the salesperson says and what their loan department give you can be different things.
- Don’t jump too quickly to assume discrimination. Each bank has their own standards and process for evaluating whether or not to give a loan and how much to give. Some banks partner with an evaluating company that specializes in these financial evaluations. I don’t think they’re legally obligated to take on risk beyond what they deem is financially viable, and they need to answer to their owners/shareholders and not take on risk beyond what makes sense to them.
- That said, I definitely had some strange trouble opening a bank account for the same bank that gave me the loan. The original door greeter person told me I couldn’t open an account, and their supervisor originally affirmed it, but then I had the guy who already got my loan application approved on the phone to tell them they were insane. Later they apologized even though I wasn’t bitter or angry and I just wanted to make sure the account was opened and connected to draft mortgage payments. The people who helped me open the account were really helpful, and truly did need to struggle through a type of case they probably rarely deal with. They had a giant manual of SOPs they had to refer to, and had to ask several other departments and managers questions. Be prepared to spend some time on this process. I suppose if you apply with help from a spouse who is a local citizen, maybe this is all much simpler in some ways.
The guy I worked with to get the loan was awesome. If you need a reference, let me know and I can put you in touch. I won’t benefit in any way, but he was really great so I’d like to help him wherever possible. I’m not sure if he can work with other languages, but you could ask or pair up with someone who can help with communication.
Note that for the loan approval, the call they give you to ask questions during the application is in Chinese and you need to answer in Chinese, I believe.