The U.S. mortgage industry is
undergoing the creation of a new market niche of international real estate
financing. Baby Boomers are a 75
million person strong bubble pushing through our economy and this year they
start to turn 60. With average life
expectancy pushing 85 years and growing by the hour, Boomers are rightfully
looking to expand their horizons. Second
Home sales accounted for 4 out of every 10 residential home sales in 2005 and
the increased integration of the Mexican economy with the US makes Mexico an attractive and secure
second home destination.
The industry of lending money to
Americans buying property in Mexico
is in its infancy. While some innovative
US banks have issued
mortgages for properties in Mexico
since the mid 90's the volumes have barely reached amounts that merit the attention
of Wall Street. Now with the entrance
of the Baby Boomers into the equation and the rise in real estate values in the
US
it is likely that the volumes of "Mexican Mortgages" will be much
greater in the very near future. This
market is being approached from both sides of the border.
The local Mexican Peso based
mortgage market is also just beginning to gain momentum with the first
securitizations of mortgage backed securities within the last few years.
As the financial markets of the US and Mexico continue to move toward
common structures we are likely to see greater financial fluidity across the
border. The fact remains that Mexico and the US are very different with
fundamentally distinct legal systems, different politics, different languages
and different customs. All of these
considerations must be understood and respected as we become ever more
intertwined. However, the desire of Americans to purchase beautiful beach
property in Mexico
may only be exceeded by the desire of 20 or 30 million Mexicans looking to make
a better living by building homes on either side of the border.
Most lenders that loan to
Americans buying property in Mexico
do so under rather strict lending criteria.
A 70% Loan to Value and an average fico score of 680 is considered
normal. Not to mention that certain lenders will only lend in certain areas of
the country or only with certain developers.
The real challenge to lending in Mexico is two fold: one is the
patience required to work through the closing process which can last up to 90
days or longer and the other is the volume necessary to rally the interest of
capital markets for increased liquidity.
Many challenges lie ahead for the international mortgage
industry but one thing is certain. The
beautiful beaches of Mexico
continue to call and the money is just beginning to flow.
Scottsman's Guide Article, April 2007
For more information on how to
get a mortgage in Mexico
please contact us at MEXICO MORTAGE SOLUTIONS-Enrique (Henry) Saldana Tel:
(984) 879-4351 or my Cel: (984) 116-8528, or at our e-mail:
This e-mail address is being protected from spambots. You need JavaScript enabled to view it
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