Which geographical areas are approved?

Playa Mortgage is able to fund loans in many areas of Mexico including Los Cabos/La Paz Corridor, Puerto Vallarta, Puerto Penasco (Rocky Point), Cancun/Playa del Carmen Corridor, Ajijic/Chapala, San Felipe, Tijuana/Ensenada Corridor, and Mazatlan. New areas are under consideration at this time, but have yet to be approved.

How much do I need for down payment?

Minimum down payment is 30% of the sale price. Our minimum loan amount is $100,000.  We do not allow subordinate financing with our loan. 

Can I get a loan for my investment property through Playa Mortgage?

The properties financed by Playa Mortgage cannot be considered investment properties.  The loan must close in the individual borrowers' names.  We will not allow a loan to close in the name of an LLC.  Our loans are to finance a primary residence or a 2nd/vacation home in Mexico.

Is it safe for foreigners to buy land in Mexico? 

Yes. Mexican laws have changed in the past 30 years. The law is now more accommodating towards United States citizens who wish to own property in Mexico. Foreigners once were prohibited from owning property in coastal areas referred to as The Mexican restricted zone (property located within 100 kilometers of the border or 50 kilometers from the coastline). Now, US citizens can purchase property in this zone through a bank trust. This trust, or fideicomiso, enables the selected bank to act on behalf of the purchaser.  It is important to note that Playa Mortgage requires a Guarantee Trust through GE Capital Bank in Mexico City on all loans, regardless of property location.

What is a fideicomiso?

The fideicomiso is much like any American trust. While the bank, which acts as the trustee, becomes the official owner of the property, you become the beneficiary. As the beneficiary you retain and enjoy all rights of the property under this agreement. This includes (but is not limited to) the right to occupy, rent, repair, or sell the property. The trust lasts for 50 years and is renewable for additional 50-year periods. There is a trust set up fee and also an annual fee.  Playa Mortgage requires a Guarantee Trust with GE Capital Bank in Mexico City on all of our loans, regardless of the location of the property.

What are the closing costs?

The closing costs will be more than what you are accustomed to in the US. On a cash transaction closing costs include the trustee fee, appraisal, homeowners insurance, property acquisition tax (equal to 2% or more of the purchase price), and other miscellaneous fees. When financing a loan it is necessary to purchase additional services such as escrow services, title search, title insurance, a U.S. market-style appraisal, etc. Some closing costs vary depending on which city/state the property is located. When financing, closing costs can typically average between 6%-10% of the sales price. Your professional loan consultant at Playa Mortgage will carefully explain your closing costs and take time to educate you on the real estate process in Mexico.

Is there a pre-payment penalty on the loan?