The Foreigner’s Guide to Getting Home Loan in Cambodia

Over the past decades, Cambodia’s economic boom and vibrant community have enticed a good number of expats who have opted to settle down and choose to build not just careers, but also their families in the Kingdom. Both major cities Phnom Penh and Siem Reap offer a competitive environment for developing global competence in various industries, with the latter holding the more laidback atmosphere that attracts many to leave their home countries in the first place. 

As acquiring one’s own home property is a huge point in settling down overseas, foreigners will be happy to know that it is possible for them to get a home loan in Cambodia! Granted, the process is easier and more accessible for locals, but opportunities are still here. 

In the Kingdom’s growing banking system, there are two (2) main sources for taking out home loans: bank loans and developer loans. The former is both more common in the Cambodian property sector and widely available to both locals and foreigners, though developer loans do offer more flexibility for foreigners. 

Available bank and developer loans

Among the few banks that offer home loans to non-Khmers are RHB Cambodia, a Malaysian-owned bank; Cambodia-owned Vattanac Bank, and J Trust Royal Bank, a joint venture between a Japanese financial holding company and a local conglomerate. Meanwhile at Maybank, a foreigner married to a Cambodian may go for a joint application for a home loan. 

Note: It is strongly suggested to clarify with your banking partner of choice all the req whether their criterion for an eligible foreigner is to have a Cambodia-based income or merely be working inside the country. 

Rose Apple Square, a premier condominium development in Siem Reap, happens to have an Alliance Program with J Trust Royal Bank. It levies a loan approval fee of 1% of the loan amount (e.g. $500 fee for a loan amount of $50,000), and a five-year lock-in period. Interest rates are 6.88% p.a. for the first year, and then 7.88% for subsequent years.

Another high-end development in Siem Reap, Angkor Grace Residence and Wellness Resort, provides a unique guaranteed rental return of 7% to 8% , designed to help buyers earn monthly revenue from their ownership of a unit. A developer loan is offered, requiring a 50% down payment, followed by monthly repayments ranging between $1,059 to to $2,161, depending on the type of unit and whether one avails a five-year or 10-year loan term. 

Monthly repayments with Angkor Grace remain low as the guaranteed rental return covers most of it for the initial five (5) years. Meanwhile, in the final 5 years, the the guaranteed rental return is enough to cover all of the loan, making this deal an almost surefire way of maximizing your home loan into a long-term investment and leisure property. 

Eligible properties 

Nevertheless, there remains a limit on the type of property that can be owned by a foreigner in Cambodia, thus also influencing what type of property you may get a home loan for. 

Both Rose Apple Square and Angkor Grace are developers of condominium units, which are the only properties in Siem Reap that come with a strata title and thus the only type of property that an expat may own in their own name. 

In summary, a strata title involves co-ownership within buildings having several residents, with exclusive ownership of private units (e.g. condos) while still sharing common spaces such as lobbies, stairways, and other common facilities. 

It is the only means by which a foreigner may legally own a home property in their own name in the Kingdom, unless they use a Cambodian nominee. As the strata titles are issued by the Ministry of Land Management, Urban Planning, and Construction, they are recognized on a national level.

General requirements 

While requirements may still vary among banks and developers, here is a quick rundown of documents to prepare and make the process as quick as possible when you begin applying for a home loan in Cambodia. 

There is a small variation between expats who are employed, and those who are self-employed or own a business: 

Foreign employees should prepare a valid passport or national ID; their work permit and employment contract or certificate; a passbook or bank statement, or three (3) months’ worth of pay slips; and their curriculum vitae (CV). They will also have to present a sales purchase agreement for the property in question, and pass a credit check from Credit Bureau Cambodia

Meanwhile, foreign business owners or the self-employed must also be able to present a valid business license and business registration; their latest business patent; a bank statement; financial statements for the last two (2) years; three (3) months’ worth of sales records or purchase invoices; and their company profile. Like employees, requirements also comprise a valid passport or national ID; passing the CBC credit check; and the sales purchase agreement for the involved property. 

As stated above, having these ready when you approach your bank or developer of choice to take out a loan will help make the process more efficient, but always anticipate any other documents that the company or institution deems necessary for you to provide.

Note that even when you are provided a contract by an institution in English, a Khmer contract may still overrule the translated version. It is always advisable to have a reliable agent or assistant by your side throughout the process to eliminate misunderstandings due to the language barrier and other cultural differences.

IPS Cambodia Real Estate
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