Traditional home loans through Costa Rican banks are hard to come by.  Even Costa Rican Nationals have difficulties with housing loans. And when they are approved, the traditional bank loan comes with interest rates that are comparable to U.S. personal loans. On the other hand, this is one of the main reasons why there are very few foreclosures in the Costa Rican market; the Lending system here is still very conservative.

The most common case of a foreigner being approved for a fair loan is if they already have residency and an established, valuable business that they can loan against. But if you don’t have a highly successful business in Costa Rica and without U.S. lenders catering to the international housing loan market, how does one make a large purchase (like a home) in Costa Rica without having all of the cash in hand?

Costa Rica’s foreign real estate market has noticed this issue and IS starting to adapt. What used be a pure 100% cash market is now starting to see much more seller financing from both private home owners and development corporations. The increase in foreign buyer interest and decrease in cash availability has forced the selling market to be sufficiently more flexible when it comes to the discussion of financing.

A fairly standard financial agreement between buyers and sellers that we have been seeing of late is: A 20% – 50% down payment with a financed interest rate on the balance of between 7% and 9%. Typically the terms will include a balloon payment after a certain amount of years. With more and more demand, these rates continue to go down. I have seen some private sellers finance as low as 4% or 5% with a sufficient down payment.

So, if you don’t have all the money up front, don’t fret. We can still find something great that will work for you! Just keep in mind that you are probably going to need enough available cash to put at least 20% down.


You can use the form below to ask us about financing in Costa Rica today!

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