How are NPLs and NPAs related?
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Let’s start with NPL (Non-Performing Loan), which refers to loans that are overdue for more than three consecutive months. Financial institutions classify such debt as “bad debt.”
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On the other hand, NPA (Non-Performing Asset) refers to foreclosed or distressed assets that financial institutions acquire through debt settlement transfers, foreclosure auctions, or buybacks from the Legal Execution Department’s auctions. These assets are then offered for sale in order to recover income from the borrower’s NPL.
What Are the Advantages of Non-Performing Assets (NPAs) ?
Non-Performing Assets, or NPAs, that are popular among buyers in the market are typically second-hand real estate such as houses or condominiums. Since these assets have had previous owners and have been used to some extent, their value is often adjusted downward. However, the quality of such properties generally remains high, making them an attractive option for ownership at a more affordable price.
At present, the number of NPAs has increased compared to previous years due to economic conditions. Yet, demand for NPAs has also risen. The main advantages of NPAs include:
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Lower Prices
Since financial institutions are required by law to liquidate these assets, they often set prices slightly below market value in order to enhance liquidity and facilitate sales.
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Good Locations
NPAs are typically properties used as loan collateral, which are usually located in prime areas. For example, commercial buildings are often situated in strategic business zones, while houses or condominiums may be located in central Bangkok. These properties are often in near-new condition but are priced significantly lower than comparable properties, making ownership more accessible. This makes NPAs especially popular among working-age individuals who are looking to build stability or establish a permanent residence.
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High Investment Value
Real estate investors benefit from acquiring NPAs at lower prices in good locations with strong demand, thereby generating attractive profits. Even during economic downturns, demand for such assets remains consistent. With their adjusted and more affordable prices, NPAs can be resold more easily, making them a popular choice for speculation and investment.
Although NPAs offer compelling benefits that attract buyers, it is still essential to exercise caution and diligence before making a purchase decision. If you are considering acquiring an NPA—whether land, houses, condominiums, or commercial buildings—J.E.D.I. Asset Management can provide professional advice and a wide selection of NPAs in prime locations at competitive prices across Thailand, ensuring expert guidance and support throughout the buying process.