Financing Options in Mexico 2014
Financing through U.S. banks for foreigners is no longer available here in Mexico now. As of 2013, the banks
have streamlined their mortgage programs as a direct result of the worldwide economic crisis and opted to
withdraw from the foreign second home market.
In Mexico and the Baja now, the main stream way to receive financing is to look for properties offering
owner financing. Sellers offering owner financing, for the most part, set their own requirements for terms
of the loan, including down payment, duration and interest rates. They may also set the requirements for
title transfer, meaning a fideicomiso en guarantia or a reserva de dominio, depending on the nationality of
the seller. Down payments on average are generally 50 to 60% of the sales price, and when asking for owner
financing, your ability to negotiate the sales price is lessened. Some sellers may go down to 30% down
payment, but, it is really the needs of the seller that givern the financing options when a seller extends terms.
To put this into perspective, the banks were asking for a 40% down payment by 2013 when bank loans were available.
Loan duration terms are set by the seller. Some may extend a loan to 10 years, while others want the property paid in full in 2 years or less.
While some items may be negotiable, others may not be.
Some developer communities may also offer developer financing. In these cases, negotiation on any loan offered by a developer may not be possible.
It is a good idea to pre-qualify before coming to Baja. One company here in the Baja, has a program of US standard qualifying and loan servicing that most owner financing contracts require.
Contact us for more information. Some specialty commercial financing may be available, however minimum loan amounts start at several millions of dollars, geared to large projects, as opposed to a small purchase. Qualifications are stringent.
Contact us for more information firstname.lastname@example.org.