30-Year Loans Now Available for Home/Condo Purchases in Mexico

It is getting easier to buy a home or condo in Mexico.

GMAC International Mortgage recently announced it has rolled out a 30-year, fixed-rate mortgage for U.S. citizens buying property in Mexico. This is in addition to a "stated income" or limited documentation option for a slightly higher interest rate. Both components also are available to borrowers for "cash-back" refinances, allowing you to pull out up to 50% of the cash value of your primary residence or second home in Mexico. And the cash-back ratio will soon increase to 70%, according to information from GMAC International Mortgage.

GMAC is the first U.S. lender to introduce a 30-year, fixed-rate product south of the border, offering a 30-year fixed-rate mortgage at approximately 8.75%; a 20-year mortgage at 8.5%, and a six-month adjustable-rate mortgage tied to the LIBOR (London Interbank Offered Rate) at approximately 8%. Other U.S. lenders are expected to soon follow GMAC's lead.

The new mortgage loan rollout by GMAC was announced at the recent Mexico Resort Development Conference, attended by more than 300 major developers, builders, lenders, and investors targeting real estate in Mexico. This news, combined with the fact that the new political administration in Mexico is committed to continuing the flow of foreign investment into the country, buoyed the enthusiasm of those in attendances, including the North American builders, developers, and lenders who have brought to market thousands of homes, hotels, and fractional units in Mexico in the past six years.

Mexico's newly inaugurated President Felipe Calderon has targeted increased tourism as part of his aggressive political platform - and it seems that U.S. mortgage lenders are ready to support that agenda.

It is especially important to make note of the "cash back" component of GMAC's program. For the first time, U.S. citizens can tap into the equity of their Mexican homes and take the cash back to the U.S. for investment. If you own property in both Mexico (where real estate prices are appreciating) and the U.S. (where prices are stagnant), you may be able to use your assets in Mexico to offset the cost of housing in the U.S.

Best Regards,

Suzan Haskins
Editor, Mexico Insider
International Living

P.S. We've written about how to qualify for a mortgage in Mexico in our monthly online publication, Mexico Insider. It's the best resource for anyone considering a move to Mexico. Learn more here.