Can a Canadian finance property in Mexico?
Another question that we get quite often from Canadians visiting Playa del Carmen is whether or not they can get a mortgage when buying a vacation or rental property down here in Mexico….
So, can I get a mortgage in Mexico?
The short answer is no.
Let’s explore a few of the aspects surrounding the subject. First things first… Why? Well, the Mexican banks won’t lend to someone for whom they can’t verify credit, employment and income. You would have to establish Mexican credit history and verifiable Mexican income in order to qualify for a home loan.
Generally speaking, a Canadian bank won’t lend money on a house they can’t foreclose on and they have no authority to foreclose on any property in Mexico so…
Now, here’s the good news….
IF you were to get Mexican bank financing, you would end up paying around 16%!! The huge majority of our Canadian clients that require financing in order to purchase a property in Playa del Carmen take out a home equity loan or a personal line of credit and get an interest rate of 3%-4% which although we are spoiled, is still incredible. It’s basically free money. And since real estate values in Playa have been appreciating between 10% and 14% a year, you can absolutely end up ahead on your investment.
Please check out the video below for additional information on mortgages on Mexico!
So there you have it, folks… even if you could get financing in Mexico, you wouldn’t want to anyway. Fortunately, money is still amazingly cheap in Canada and if you need to finance your dream home here in Playa del Carmen, that’s a cheap and easy alternative.