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100% Home Financing In Costa Rica

How do borrowers get home financing in Costa Rica when the banks don’t help them? 100% financing is the answer!

An example is an expat who does not have Costa Rican residence. Consider a borrower who wants to spend $200,000 USD on the house but isn’t yet a resident of Costa Rica. They would need to find $200,000 USD in cash, correct? No, there is an alternative solution.


The 100% Financing Solution

With our assistance and our sister company, Gap Real Estate, they can buy a home with 100% financing. We work to get the owner or seller of the house to move the property into a trust. The property remains in the trust until the property is paid.

While this process is underway, the Seller is asked to finance $120,000 USD at perhaps 8% (negotiable). The buyer is given a mortgage of $80,000 USD at 12%. They will have an average interest rate of 9.6%. That competes with mortgage loan rates at Costa Rican banks!

Of course, putting money down would be even more attractive… for example, if they had a property or business to sell back in their country of origin. But, there is often a time delay between selling your home or business and putting down a decent down payment.

We generally process loans in terms of 3 years. And, “If they are never a day late or dollar short” on their loan payments, there is a perfect chance of a private lender (you) renewing the loan (about 99% chance of renewal). During these 3 years, they can obtain their residency and apply for a traditional mortgage offered by a local bank.


Paying Off the Loan

When the sale of the expat’s home or business finalizes back in their home country, they will have the 20-30% down payment required by a local bank to secure a new mortgage loan. Once they have the funds from their new loan, they would pay off the original mortgage with the seller. The house’s title moves from the trust to the expat’s (borrowers) name.

This example scenario applies to local Costa Rican citizens and not just foreigners. It is a feasible and viable solution for all parties involved — Realtors, Sellers, and Buyers.

100% Home Financing is an excellent opportunity for private lenders to fund and profit from secured equity loans!

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