Foreign Investment Properties

As you near retirement, you may find that your dream of owning a second home in another country is overwhelming. Many retirees are leaving the United States behind and finding suitable housing in other areas of the world. Not only is this often more affordable than you may think, but it is also an excellent way to spend the remainder of your life.

The biggest problem with purchasing foreign investment properties comes with the difference in mortgages from country to country. The best place to start is by following a simple rule that usually applies with different countries.

Bulgaria and Czechoslovakia

Bulgaria and Czechoslovakia have become a hot area for investment property. At the moment, bank terms are still iffy. Those banks who will lend money to foreigners usually require a small down payment (15%) and give a term of twenty-five years. With new buildings, the money is not released until the property has been built and inspected.

Canada

Canada is probably one of the easier countries for obtaining mortgages. Many banks require you borrow at least $75,000 Canadian and have 25% to offer as a down payment.

Caribbean

In the Caribbean, many banks require the purchaser to have at least 30% down. If you do not have enough cash to pay 30% of the house’s cost, you will need to come up with it. Banks in the Caribbean will give mortgages to foreigners, but you must plan to pay off the mortgage in a much shorter time. Usually mortgage terms are from two to twenty years.

France

France is a dream retirement area for thousands of Americans. To purchase a home in France, you can borrow up to 90% of the home’s value or 80% if you opt for an interest-only mortgage program. Italy is similar and requires you to pay off the loan within five to 25 years. Italy requires a minimum mortgage amount of 50,000 Euros.

New Zealand

In New Zealand, any mortgage must be paid in full by the buyer’s seventieth birthday. To get a mortgage in New Zealand, expect to pay high interest rates and to give someone at the bank power of attorney before the mortgage will be finalized. Australian rules are very similar. They require a full background check, financial check, and more before they will approve a mortgage loan. If you do qualify for a loan, you usually need a 25% down payment.

Spain

Spain is one of the easiest European countries to obtain a mortgage. Any mortgage must be paid off by your 80th birthday. Loans are give for terms of 40 years and require 30% down.