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Financing an Overseas Real Estate Purchase

“Kathleen, for the investor who doesn’t have US$50K to US$100K+ in liquid assets to buy a house, how difficult is it for a citizen to get a mortgage with a 20% down payment? I read in some places the banks require 30%.”

–Blue B., United States

You won’t be able to arrange bank financing for the purchase of real estate in most of Latin America; Panama, Mexico, and the Dominican Republic are exceptions. Many countries in Europe will lend to nonresident foreigners if you qualify… which is harder to do all the time.

That said, nowhere will you find banks willing to lend up to 80% LTV to a foreigner buyer. Typically, you’ll need to put at least 30% down. Don’t expect a fixed rate of interest either; variable rates are the norm in most of the world. Right now, though, interest rates are low in Europe; you can borrow in some cases for as little as 2%.

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