Overseas mortgage
Hi Terry, we’re thinking of getting a second home in Mexico. We’re relatively young,in our 40’s, physicians. When looking at property most countries are asking from 30-50% down payment, money which we don’t have. Homeprices we’re looking at are around $400-450k
Plan is to pay off the home in Abt 20 yrs when we retire.
Do we have any options as to getting an international mortgage with lower down payments?
Your thoughts/other suggestions?
Thanks
Terry Says
Whew –this is way over my pay grade, so I had to do a little research. Everything I read points to only one solution: borrow against your existing home and pay cash for the overseas home!
That interest is no longer deductible (because you are not using it to “improve” your home. But it is likely the lowest rate you’ll get. And you’ll be repaying in dollars — not a foreign currency.
Foreign banks charge high rates primarily because they can’t go after you if you default! And a home is no bargain if you’re paying high interest over the years until your retirement. One more caveat: beware of online mortgage lenders who promise loans in foreign countries.
Here’s a link to an excellent article that I found in my search.
You might want to re-think your plans. The world can change a lot in 20 years, and while home-ownership has historically been profitable in the US, you can’t necessarily say the same about Mexico! Have you considered Costa Rica?
