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Banks opening to loans?

by Mark Venegas

Before the world economic crisis it wasn’t too difficult to obtain a loan from the local banks, either mortgages over your property or to foreigners that needed a loan to purchase a property. Some/most banks here were also appraising properties at higher values than the markets reality, putting many people in difficult situations. Then the crisis came along and banks, very similar to the US banks, basically shut down to the possibility to obtain a loan.
Now that the worst of the crisis seems to be behind us and the recovery, although slow, has begun, the government (Banco Central) is encouraging banks to open up to giving loans to local and foreign investors. While many banks here have announced their “reopening” to loans the reality is that it is still very difficult to be approved for one. If you are planning to jump through the loops and apply for one, be prepared, even though it is not impossible, the process will be extensive and tedious. The prerequisites are very similar to what banks in the US ask for, here are the basics; your ID (Passport), SS#, Income Tax Returns or similar from the past three years, bank statements from at least the last six months and information of any open/active credit that you may have. This is not everything and obviously each case is different and handled individually. If this is your only option to be able to buy your piece of the tropics come prepared with patience and of course the needed documents, it will not happen overnight.
Here is what three of the major local banks offer in interest rates. This is in general and will vary depending on the amount and the time (length) of the loan:
Banco National de C.R.  7.5% –  9%.
Scotiabank  6.75% – 9.5%.
Banco de C.R.  7% – 11%.

Comments (1)

  • Hi Mark, thanks for the post about financing. I have helped people in the past with the banks and I would say many will loose their patience. The once who make it, will have to wait up to 9 months to get approved. During the 9 months, several documents will be asked by the bank, about each month another new one. Pura Vida. In other words: it is possible, you just have to be patience.