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Financing — without a Canadian bank.
Why RBC, TD, BMO, Scotia, and CIBC won't lend on Costa Rican property — and how our owner-financing replaces the bank entirely. 0–9% fixed, 20–40% down, day-one title.
Every Canadian-buyer call starts with the same line: "I called my bank, they said no." It's not a misunderstanding. Canadian banks structurally do not lend on Costa Rican real estate — and Costa Rican banks rarely lend to non-residents. For most Canadian buyers that means cash-only purchase, or owner-financing. We specialise in the second.
Why your Canadian bank declined
This isn't your bank's fault, and it isn't a credit issue. The structural reasons:
- Foreign collateral — Canadian banks can't perfect a security interest against Costa Rican real estate. The Costa Rican Registry doesn't recognise Canadian mortgages; foreclosure mechanics don't translate.
- Cross-jurisdictional enforcement — if you default, the Canadian bank can't foreclose in Costa Rica without spending more on legal fees than the property is worth.
- Regulatory exposure — OSFI (Canadian banking regulator) treats foreign-property loans as elevated risk, requiring extra capital provisioning that makes the loan unprofitable.
- Tax compliance — interest paid by a non-Canadian-resident borrower triggers Part XIII withholding mechanics most retail-bank product teams don't want to handle.
Result: 100% of the major-Canadian-bank product teams I've spoken to in the last 3 years say "we don't lend on Costa Rica." The same applies to credit unions and most private lenders.
Why Costa Rican banks usually decline too
BAC, BCR, Scotiabank CR, Banco Nacional, Banco Popular: all CR commercial banks technically can lend to non-residents, but in practice they require 24+ months of Costa Rican tax filings as proof of income before underwriting. A Canadian who's just bought their first property has no CR tax history. Result: declined or quoted at 11–14% with onerous covenants.
What owner-financing actually means
Owner-financing — sometimes called seller-financing or vendor take-back — is a structure where the seller of the property carries paper instead of you taking a bank loan. You make a down payment at closing, take title in your name, and pay the seller monthly (or quarterly, semi-annually, balloon) over a defined term. The seller's claim is registered as a hipoteca at the Costa Rica National Registry — a public, dated lien — so their security and your ownership both exist from day one.
The deal closes whether your Canadian bank ever approves anything or not. The seller is the lender, not RBC.
Typical terms we negotiate
| Parameter | Range | Typical |
|---|---|---|
| Down payment | 20%–50% | 30% |
| Interest rate | 0%–9% fixed | 5–7% |
| Term | 3–15 years | 5–10 years |
| Payment frequency | Monthly · semi-annual · balloon | Monthly amortizing |
| Prepayment penalty | None to 2% | None |
| Title at closing | Always day-one | Buyer's name in your or your entity's name |
| Currency | USD or CAD | USD priced; some CAD-priced |
The 0% Edge — when sellers say yes
For deals where the buyer brings 35–45% down and the seller is exit-motivated (retiring, estate-selling, partner exit), we negotiate 0% interest. Sellers trade interest yield for a defined-payoff timeline — they get $1.0M today and $1.0M in 24 months instead of chasing yield on a property they no longer want to manage. We close several 0% deals each year.
Sample 0% structure (real recent close)
- Purchase price: $550,000 USD
- Down at closing: $100,000
- Semi-annual payments: 6 × $50,000 = $300,000 total
- Balloon at month 36: $150,000
- Total interest paid: $0
What a bank loan would have charged on equivalent: ~$50,260 in interest. Saved by negotiating directly with the seller.
$550,000. Zero percent. Closed.
Actual structure recently negotiated by Real Estate Grupo. Buyer brought $100K down, paid $50K every six months, balloons the remainder at month 36. Total interest paid: zero.
At closing · 18% of purchase price
Negotiated directly with seller. No bank rate, no margin.
6 × $50K every 6 months · $150K balloon at month 36
For comparison: a Canadian-bank loan at 7% over 36 months on the same financed amount would have charged roughly $50,260 in interest. Saved by negotiating directly with the seller.
How the deal closes — your protections
- Independent attorney — your own Costa Rican attorney reviews every document. Never the seller's lawyer.
- Registered hipoteca — the seller's lien registered at the Registro Nacional. Public, dated, enforceable.
- Notario Público — closing executed by a licensed Costa Rican notary, a public officer with state-delegated authority.
- Escrow — funds released only on registry confirmation. We use Stewart Title, BCR Escrow, or Pacific Trust depending on deal size.
Canadian buyers shouldn't waste a month chasing Canadian-bank approval that won't come. Start with the property, structure owner-financing around it, register the hipoteca, take title day one. Most Canadian deals we close end up at 5–7% fixed over 5–10 years with no Canadian credit pull. Some end up at 0%. None depend on Bay Street.
This page is informational only — not financial or legal advice.
Other questions Canadian buyers ask us.
Want to see properties we've negotiated to 0%?
Avital — our Canadian Buyer Lead — will pull our current owner-financed inventory plus 2–3 negotiable properties where we think we can get the seller to 0%. Free 30-min call.
Founders' direct line · WhatsApp +506 8798 6122 version française