Getting LOANS or KPR for housing as an expat

[NicheAsian]

Hello there, I am a foreigner age (32) who is going to start working in Indonesia as an expat high school (grade 11, 12 ) teacher in a large international school in Jakarta. My salary is not very high is only around 40 million rupiah a month. However I have long term plans on living in Indonesia and want to think bout settling down and having a house in Indonesia. What is the likelihood of myself getting a KPR or a loan from a local bank in Indonesia ( i do not have much savings) ?

 

[centurion]

In short, not possible.

 

[fastpitch17]

One way. Marry a rich Indonesian.

 

[Will_M]

Save your salary, purchase a property in your home country and use that to pay the rent on your property in Indo.

If you have limited savings, the last think you want to do is invest in property here (IMHO)

 

[jukung11]

The property market in Indonesia is generally upside down in most areas, meaning the cost of ownership (mortgage interest, taxes, depreciation, maintenance) generally exceeds the cost of rent. This is a holdover of inflation/hyper-inflation in the culture. Indonesians will sink their wealth into property because they fear inflation and want physical assets and are willing to pay a premium for that.

Permanent resident foreigners can only have a freehold property rights on apartments (hak milik) or leasehold rights (hak pakai) on houses. There is a minimum price per province that your salary would not qualify for in Jakarta. (3 milar apartment, 5 milar house)

Generally mortgages for hak pakai (long-term lease) require 35-50% down, with finance terms of a 10-15 year mortgage with higher interest rates. This is because the resale market for leaseholds is bad and they are difficult to sell.

I will concur with the other posters. It is better to rent and put any excess salary to other investments or retirement for a greater return.

 

[pantaiema]

Indonesians can obtain mortgages with salaries that are just a quarter of yours, making your salary quite good by Indonesian people standards. However, as a foreigner, there are restrictions on the properties you can buy, mainly regarding the minimum price. In Jakarta it is IDR 3b for an apartment in condominium and IDR 5b for a house on a plotted land. This is based on the Government Regulation GR 18/2021 and current Agrarian Ministry and National Land Agency Regulation No 1241/SK-HK.02/IX/2022

Due to these restrictions, it is highly unlikely that a bank will give you a mortgage, as you said you can not put a significant down payment due to lack of saving. Additionally, it is well known that foreign workers in Indonesia do not have permanent job contracts, which does not work in your favour when considering the duration of the mortgage. If you could get it it is highly likely you will pay a high premium price in term of interest rate to compensate this.

Another thing you need to consider before buying property in Indonesia is that, the laws and regulations can change quickly, easily and without much notice. When it comes to property ownership, foreigners have very limited rights. Currently, you can not have a freehold.

Nevertheless, if you want to try, you might have a better chance with a foreign bank especially the bank you have been banking at home, know your history that has a branch in Indonesia. If you decide to try please do share your experience so we could also learn.

 

[Samoerai]

Hello there, I am a foreigner age (32) who is going to start working in Indonesia as an expat high school (grade 11, 12 ) teacher in a large international school in Jakarta. My salary is not very high is only around 40 million rupiah a month. However I have long term plans on living in Indonesia and want to think bout settling down and having a house in Indonesia. What is the likelihood of myself getting a KPR or a loan from a local bank in Indonesia ( i do not have much savings) ?

Pertama Bank offers a 10 year mortgage financing facility to WNA's (foreigners).
Requirements are:

• age 21 - 57 years
• min. income 25 million per month
• permanent employee contract, with work period 2 years, incl. previous work experience
• Kitas/kitap
• reference letter (for employee)
• down payment of around 15%
• interest rate 11% for a WNA (mind you: for a WNI it's 4,25%)

All negotiable to some extend.

My advice: just rent and keep it simple.

 

[NicheAsian]

Pertama Bank offers a 10 year mortgage financing facility to WNA's (foreigners).
Requirements are:

• age 21 - 57 years
• min. income 25 million per month
• permanent employee contract, with work period 2 years, incl. previous work experience
• Kitas/kitap
• reference letter (for employee)
• down payment of around 15%
• interest rate 11% for a WNA (mind you: for a WNI it's 4,25%)

All negotiable to some extend.

My advice: just rent and keep it simple.

Thanks for the advice ! Just another question, does anyone know any financial agencies or banks which do personal loan lending to foreigners working in Indonesia ?

 

[Samoerai]

Thanks for the advice ! Just another question, does anyone know any financial agencies or banks which do personal loan lending to foreigners working in Indonesia ?

One can lend money through apps, like DANA.

Syarat, Cara Pinjam Uang di DANA, Kelebihan, dan Risikonya

Ada banyak orang yang belum mengetahui cara pinjam uang ke dana, kelebihan serta risikonya. Berikut penjelasan lengkapnya.

finansial.bisnis.com

Or through GoPay ... max 15 juta, not much though.

Cara pinjam uang di GoPay, syaratnya mudah dan bisa langsung cair

Melalui platform satu ini, pinjaman uang yang diajukan langsung cair dalam waktu kurang lebih 30 menit.

www.brilio.net

 

[NicheAsian]

One can lend money through apps, like DANA.

Syarat, Cara Pinjam Uang di DANA, Kelebihan, dan Risikonya

Ada banyak orang yang belum mengetahui cara pinjam uang ke dana, kelebihan serta risikonya. Berikut penjelasan lengkapnya.

finansial.bisnis.com

Or through GoPay ... max 15 juta, not much though.

Cara pinjam uang di GoPay, syaratnya mudah dan bisa langsung cair

Melalui platform satu ini, pinjaman uang yang diajukan langsung cair dalam waktu kurang lebih 30 menit.

www.brilio.net

Does this apply to foreigners as I believe i do not have KTP but only KITAS.

 

[Samoerai]

Does this apply to foreigners as I believe i do not have KTP but only KITAS.

At BCA you can open a bank account based on your passport / KITAS and also can get a bank loan (kredit tanpa agunan ). Check

Cara Mudah Mengajukan Pinjaman Bank BCA, Tanpa Agunan!

Ingin mengajukan pinjaman tapi bingung bagaimana caranya? Yuk ikuti cara mengajukan pinjaman Bank BCA yang ada di sini, mudah dan cepat

kledo.com

 

[fastpitch17]

At BCA you can open a bank account based on your passport / KITAS and also can get a bank loan (kredit tanpa agunan ). Check

Cara Mudah Mengajukan Pinjaman Bank BCA, Tanpa Agunan!

Ingin mengajukan pinjaman tapi bingung bagaimana caranya? Yuk ikuti cara mengajukan pinjaman Bank BCA yang ada di sini, mudah dan cepat

kledo.com

You have to have a BCA credit card for one year and a foreigner can only get a secured credit card. Really doesn't matter what BCA says are the requirements. They will not give an unsecured loan to a foreigner simply because a foreigner is not grounded in Indonesia. Foreigners have almost impossible chances of even getting loans with collateral. At least a few I know that have tried.

 

[MamangDudul]

All I can say is, as long as you are not married here and don't have a lot of savings, I wouldn't try to buy a house. The people here already told you why, it's a difficult situation for foreigners in Indonesia, especially without much savings and the fact that you can't really own anything.
Your salary of 40 million is pretty good for a teacher, especially compared to many locals. It's better to rent a place that fits your needs and have a nice life with the rest of the money or save it. With 40 juta you can have a pretty good life in Jakarta (i know some will disagree, but if you can't live comfortable from 40 juta ANYWHERE in Indonesia, especially as a single, then I guess most Indonesians would already have chosen suicide). But against prices of at least 2-5 M for property, with these laws here, I don't know if that's the right way.

 

[pantaiema]

Does this apply to foreigners as I believe i do not have KTP but only KITAS.

In case you're not aware, online loans via mobile apps are usually payday loans. These loans offer small amounts of money, which won't meet your requirements for buying a house. I haven't heard of anyone using a payday loan to buy a house, as the amount is tiny and the interest rate is very high. You can get approved for IDR 10 million in just a few minutes without collateral, as they often use debt collectors to recover money from those who fail to repay.

For example, this link shows how to borrow money from 'DANA' the lender you are referring to, where you can get a loan of IDR 10 million disbursed immediately without an ID card:

https://beritadiy.pikiran-rakyat.com/citizen/pr-706645207/ternyata-ini-cara-pinjam-uang-di-dana-premium-2023-langsung-cair-tanpa-ktp-pinjaman-rp-10-juta-cair-modal-hp

If you google "pinjol," you'll find many lenders like this. Some have been banned in the past due to operating like loan sharks.

Typically, people need a mortgage (KPR), a secured loan, to buy a house because of the large amount involved, and you use the house as collateral. Additionally, buying a house is a rather complicated process involving notaries and the land registry.

 

[Jaime C]

Just a note, debt collectors in Indonesia are very serious. Not like some parts of more affluent countries that will just call, or send you letters.

I know one Indonesian who has to leave their house before sunrise, to avoid the debt collectors who camp outside their house.

 

[jstar]

If you mean with serious immensely aggressive and not avoiding dodgy illegal practices, I agree.