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Published on March 13, 2008

Home-buyers can drool over fantastic credit deals at the "18th Home & Condo Festival 2008", like zero interest for up to 12 months.

However, they should be well aware of the loan details as the zero-rate mortgage loans are mostly geared for those who buy non-performing assets (NPAs).

Banks are keen on divesting their distressed loans this year, as the central bank has set a target in Phase II of the Financial Sector Master Plan for non-performing loans (NPLs) and NPAs to shrink from 7 per cent presently to 2 per cent in five years.

The promotions at this summer's fair seem to be more attractive than last year, thanks to the downtrend in interest rates and the government's recent tax cuts for the property sector.

Those looking to take out a bank home loan or any re-finance loan should not miss the fair this year. They can shop for a lot of special packages at many bank booths from today until Sunday at the Queen Sirikit National Convention Centre.

The Government Housing Bank is attracting homebuyers with no interest charged over a long period of 12 months for customers who apply at the event.

That is longest grace period among banks attending the fair this year. However, the special interest rate applies to resale homes only. The bank has a well-rounded selection of some 40 resale homes, its NPAs, for sale at special prices and rates.

Krung Thai Bank also serves a zero loan menu to its customers at the exhibition.

Those who buy the bank's NPAs will be entitled to 12 months of zero interest. However, those who buy non-NPA homes at the fair will get the zero interest rate for the first three months only. From the fourth to the 12th month, debtors are subject to a 3.33-per-cent interest rate. They will be charged the minimum retail rate (MRR) minus 1 percentage point throughout the remaining loan term. The bank's MRR stands at 6.375 per cent.

For those who will use Krung Thai Bank's home loans to buy non-NPAs residences, the interest rate is 3 per cent between the fourth and 12th month if they also buy a five-year home insurance policy from the bank's selected insurers.

Kasikornbank also offers fairgoers zero-interest rate mortgage loans for six months. However, the zero rate is eligible only for purchases of residences from Bangkok Commercial Asset Management.

KBank also offers a special package for those buying its NPAs available at the fair with 2 per cent fixed for the first year. The bank will charge 4 per cent in the second year and the minimum lending rate (MLR) minus 0.25 percentage point until maturity.

Siam City Bank will take five mortgage loan packages to the fair this year. They include both loans for new and resale residences. However, the zero interest rate is unavailable at the middle-sized bank UOB Bank also tempts homebuyers with resale homes discounted up to 90 per cent. Although the bank gives its customers a promotional mortgage loan rate, the zero rate is not on offer at its booth.

Somruedi Banchongduang

The Nation