It’s true; most foreigners buy in Ecuador with cash, or take a HELOC out on their US property in order to buy in Ecuador.
Few know that foreigners are actually eligible for getting home loans from banks in Ecuador.
Most of the foreigners I run into down here fall into the category of “Well, I was living in Ecuador in my home and I came across this other great deal I just had to have, so I took a local loan and snagged it before someone else did.”
OK, so what do you need (being a foreigner) in order to qualify?
The requirements greatly differ from bank to bank in Ecuador, but below are the basics.
In the smaller banks, they ask you to have some type of resident visa, along with 2 years living in Ecuador with an active bank account showing your pension income or work income movements.
If you are working in Ecuador and not receiving retirement, some banks will ask for at least 2 years in the same place of work with a legally established business in Ecuador (a deal breaker for most Americans).
Some banks, like Banco Pichincha, are a little more lenient and only ask for you to be a resident of Ecuador, and have 6 months of bank statements (in one of their bank accounts) showing your current retirement or work income.
So, in other words, within 6 months of moving to Ecuador you could be qualifying for local home loans.
But yes, some banks will require a basic medical exam if you are over the age of 60.
Home loans in Ecuador usually take about a week to approve, and 6 weeks until the distribution of funds.
Now, the point of this article was to show you that you do have local financing options, but if you are able to bring the money from the US, all the better and here is why.
Mostly all banks in Ecuador will require you put at least a 30% down payment, and will finance the rest for up to 15 years at the going rates (in 2010 it is 10.75% apr).
That may sound like a lot, but if you find a real steal down here and can’t get money any other way, this may be your only option.
Now, me personally, I have funded my endeavors in Ecuador taking out personal, non-secured loans from my bank in the US, which only charges 8.5% annual interest and from cash advances on 0% APR US credit cards (hey, property in Ecuador is still cheap!)
Until next time, happy hunting, Dom.
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