On a daily basis we receive inquiries from clients who are looking for quality properties that the owners are offering an “owner financing” option.

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Owner financing is not always easy to find in our area of Costa Rica but we do have a few quality listings that make the cut.


The AARP Ranks Atenas as…One of “The Best Places to Retire Abroad.”


Owner Financing in Costa Rica. What can you expect?

Owner financing in Costa Rica is unique and not as common as you might think. When considering any financing in Costa Rica, don’t expect to see the rock bottom interest rates like you have become accustomed to seeing the banks offering in the United States.

In the past year, we have sold several homes where the owners offered financing and in the end both the buyers and sellers were more than satisfied with the terms that were negotiated.

What Down Payment Is Required With Owner Financed Homes?

Sellers are requiring 30%-50% of the purchase price as a down payment. We have not been able to negotiate anything lower than 20% down, period.

What Are The Current Seller Financing Interest Rates?

Most sellers are asking 8%-10% as an annual interest rate but in the end are negotiable and are getting 6%-7%. The lowest interest rate we have been able to negotiate was 5%, and that was an exception, not the rule. If you can get owner financing at 6%-7% interest, go for it!

If bank financing was possible in Costa Rica, which 99% of the time it is not, then you may find a two year introductory rate of 8.75% that will adjust in 2 years to between 12%-15%!

If you are one of the lucky 1% who does get bank financing, your credit must be FLAWLESS. In the past 6 years we have had only 3 contracts with bank financing contingencies.

After months of paperwork, bank bureaucracy, and countless hours of leg work on our part as well as that of our buyers, not one of those contracts closed.

Owner Financing in Costa Rica: The terms

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Cash is still king and the sooner you can cash out the better. Having said that, typically owners offer short term financing, say between 2-5 years. However we have been able to negotiate terms up to 12 years.

A great option is to negotiate a balloon mortgage where you amortize your mortgage for 15-20 years, lowering the amount of your monthly payments. At the end of the mortgage there is a predetermined payoff date and a final lump sum payment is made (2-5 years).

This is the most common way to set up mortgages on owner financed properties here in Costa Rica. This balloon arrangement is also ideal for those who will be retiring in 2-5 years and will have access to retirement funds without having to pay a penalty for cashing out early.

Negotiating For Owner Financed Real Estate For Sale in Costa Rica:

When you are asking for owner financing, don’t expect to negotiate the purchase price in the same way as if you were paying cash.

Actually it has been our experience, 9 times out of 10 you will pay full price when owner financing is involved.

Considering that expats getting a mortgage is next to impossible in Costa Rica, and costly at that, paying full price with owner financing will save you money in the end (compared to bank financing or paying a stiff 30%+ penalty on breaking a retirement investment).

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Costa Rica Real Estate For Sale Inventory:

If you are in need of financing to purchase a home in Costa Rica, be warned your choices will be limited. Be realistic and try to see the real value in the deal, the owner financing.

Atenas and the Central Valley of Costa Rica have not experienced a real estate crisis in the same manner as other areas of the world. What this means to the buyer is that most sellers are not in a bind to sell.

In addition, there is a uniqueness to the Costa Rican real estate market in that holding costs are minimal due to low property taxes and maintenance costs, giving owners the luxury of holding out to get there price, almost always in cash.

Having said that, there are some beautiful options on the market that owners will happily consider financing.


How Does Owner Financing Work in Costa Rica?

Owner financing works much the same way as using a bank for financing except with less hassle, less time invested and minimal costs involved.

With owner financing there are no bank fees, origination fees, appraisal fees or pre-payment penalties, saving you thousands of dollars up front. There will be a mortgage placed against the title of the property in favor of the seller to give the seller security in case of default.

Most attorney’s will include the cost of creating the mortgage paperwork as part of their closing fees but there is an additional recording fee that is paid to the government at 1% of the mortgaged amount. For example, say you purchase a home for $200,000 and put 50% down and finance $100,000.

The recording fee you would pay on the $100,000 mortgage would be: $100,000 x 1% = $1000. The buyer pays all fees associated with creating the mortgage.

Can I Use My IRA To Purchase Real Estate in Costa Rica?

The answer is yes it can be done, but there is a very specific way the transaction must be set up, so consult your investment broker for all the details.

Generally speaking, you can transfer your IRA to a self directed IRA custodian which would allow you to invest in Costa Rican real estate.

Using your IRA in conjunction with owner financing could be the answer to making your dreams of living in paradise a reality sooner than later. Recently we had one client who worked with his broker in the United States and was able to invest his IRA in an annuity that paid a dividend which in turn he was able to use and pay the mortgage payment on a beautiful new home in Costa Rica.

We are not tax or investment experts and because tax laws seem to change on a daily basis, consult with your tax specialist/investment broker or seek out professionals who specialize in foreign investments.

What About Lease Options and Rent To Own?

Most buyers often assume that owner financing is the same as lease option or rent to own. It is not. Lease options/rent to own is a lease or rental agreement where “option” money is deposited and held to be credited towards the purchase price of the home.

Many times a portion of the monthly rent will be credited towards the purchase price and along with the option money, credited to the buyer once the lease agreement is executed (once the buyer purchases the house).

Neither the option money or monthly rent credit is refundable if you do not execute the contract and purchase the property. In our area we do not see lease options/rent to own deals.

There are many reasons for this but the main reason is lack of security for the seller. During our many years in Atenas, we have yet to have an owner offer their property for sale on a lease option/rent to own basis.

If you are searching for your own piece of Costa Rican paradise but need to financing, we strongly encourage you to look closely at properties where the owners will offer financing.

In addition, be creative and consult your broker about how you can put your hard earned money to work for you now, without having to pay hefty penalties for early withdrawal on pensions or IRA type investments.


Ten Homes For Sale in Costa Rica With Owner Financing.


Listed below you will find several quality properties for sale in Costa Rica which offer owner financing.

Could one of these lovely homes be the answer to your dreams of paradise?

  1. Mountain Home For Sale in Grecia, Costa Rica. Large 3,400 square foot, five bedroom home for US$100K down payment with seller financing for the balance of US$139K
  2. Great Value Home For Sale in Grecia, Costa Rica US$122,000. With owner financing with only US$35K down.
  3. Affordable Home For Sale in Grecia, Costa Rica. Fully furnished for only US$130,000
  4. Atenas 5 Cabin Retreat On 3 Beautiful Acres. With swimming pool and rancho. US$475K – US$764K depending on how much land you need.
  5. Spacious 7,000 Square Foot Atenas Home For Sale on 3 Acres. US$840,000
  6. Custom Built Home For Sale in Vista Atenas, Costa Rica. US$395,000
  7. Home For Sale in Atenas, Costa Rica. Large lot and beautiful valley views for only US$339,000
  8. Atenas Home For Sale in Roca Verde US$295K. AARP Ranks Atenas as one of “The Best Places to Retire Abroad.”
  9. New Resort Style Retirement Community in Naranjo Starting At US$240K With Seller Financing
  10. How to Spot Motivated Sellers in Atenas: 4 Recently reduced properties with seller financing

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Costa Rica Real Estate For Sale With Owner Financing. Ten attractive homes for saleArticle ID Number 4032


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