More Good Options For Financing In This Tight-Credit World
April 23, 2010, Pacific Coast, Nicaragua: Gran Pacifica, a full-service, full-amenity oceanfront community on the Pacific coast of Nicaragua, is offering real estate financing with 0% interest for three years.Dear Live and Invest Overseas Reader,
My dispatch to you last week about developer financing being offered at Sugar Loaf in Uruguay got the attention of another developer group that I've worked with for a long time. The VP of Sales for Gran Pacifica on the Pacific coast of Nicaragua, Kent Payne, wrote to me after reading my Sugar Loaf alert to propose details of a financing offer he'd like to make to the Live and Invest Overseas readership. Kent, too, recognizes that, in the current climate, the ability to arrange in-country financing can be critical to the purchase decision. Gran Pacifica is an impressive beachfront community, much more advanced than most developments in Nicaragua. A tremendous investment has been made over the past five years in putting infrastructure in the ground...and not just typical infrastructure but top-of-the-line and international-standard infrastructure, from sidewalks to storm drainage, from paved streets to street lights and even fire hydrants. In addition, at Gran Pacifica, fiber-optic Internet is available in every home.
I'm not talking about a vision or a plan. The big difference at Gran Pacifica is that all this infrastructure has already been put in place, and homes are already being built. In fact, some homes are already occupied full-time by early buyers.
Gran Pacifica is both a beach and a golf community. And, again, I'm not speaking about a plan for what will be someday. The Gran Pacifica golf course was completed and has been ready for play since last December. The longer term plan includes more holes of golf and a resort hotel on the beach.
For someone looking for an easy transition, a beach and/or golf development offering a fully turn-key community, Gran Pacific fits the bill. The on-site services include both property and construction management. And with some full-time residents already in residence, you won't feel like you're venturing off on your own in a foreign land, because, in fact, you're not.
Not to be outdone by the 0% interest offer from Sugar Loaf last week, Kent has been inspired to make his own 0% interest offer for Live and Invest Overseas readers for a specific section of lots in his Gran Pacifica community. These lots are adjacent to hole 2 of the Emerald golf course, which is open for play, and they come with no build requirement (though most other lots in Gran Pacifica have one). So not only can you pay for your lot over time, but you don't have to build on it until you are ready.
The price for these golf lots is only US$59,900, and, with the new terms that Kent is proposing, you can buy with only 20% down. That's US$11,980. The balance is paid over five years. No interest is charged over the first 36 months, and your payment per month is 1% of the purchase price--only US$599.
After 36 months, you can either pay off the loan or "refinance" the balance over a further 10 years at 11.5% interest. By refinancing, your monthly payment drops from US$599 to US$370 for the remaining 10 years. Keep paying US$599 a month, and the balance is paid off in less than five years from the date of refinancing.
Interest of 11.5% isn't cheap, but it's in the range for this kind of financing in Central America. The thing to remember is that you're getting the first three years at 0% interest. Even if you don't pay the entire loan off within 36 months, your effective interest rate over the life of the payments is extremely attractive. And, with the no build requirement, you can wait until you've paid off the lot to think about building (if that's your agenda).
I see this opportunity as particularly attractive if you have a few years to go until retirement. It allows you to secure your home lot at today's prices but be in no rush to build or to take a next step until you're ready.
Kent can provide more details on the particular Gran Pacifica lots available with this financing. You can reach him here.
Lief Simon
P.S. A couple of other developers I work with closely have contacted me since my Sugar Loaf financing alert last week. They recognize that creative offers like the ones from Sugar Loaf last week and Gran Pacifica today are critical in this tight-credit world. They're asking for my input to help conceive terms that would be attractive to our readership. These are very productive conversations that I believe will result in a series of appealing and interesting opportunities for you in key markets. Stay tuned.
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