Buying Guide – Caribbean

Lending criteria

Mortgages are available in US Dollars and will be secured against Caribbean residential property.  Caribbean mortgages will require full disclosure of income, outgoings and savings.

The maximum loan to value available is 70% to 75% of the purchase price, or valuation, whichever is the lower. This will vary depending on which island you are purchasing, so please contact us to clarify.

Caribbean lenders assess eligibility on the applicant's capacity to repay the mortgage, as well as recent credit history.  As a guideline, your debt to income ratio should not exceed 35% of your gross monthly income; however there may be a degree of flexibility in this for certain types of applicant.  Mortgage, rent, personal loans and maintenance commitments are all considered as outgoings.  To find out how much you can borrow and for a formal decision in principle, please click on Apply Now.

Types of mortgage

Mortgages can be obtained for the purchase of new or existing properties, as well as land purchase. Lending criteria for land purchase will vary, depending on where you are buying.  

Renovation and construction loans are available, however estimates will be required at the time of application, and clients must have obtained all the necessary authorisations. Once the mortgage has been approved, funds may be released by the lender directly to your builders or to you, following submission of invoices. In the case of construction loans, more detailed information on the project will be required, so please contact us.

Mortgage products

A variety of products are available. Both interest-only and repayment mortgages can be arranged, on a variable or fixed-rate basis, or a combination of both. Terms can be from 5 to 15 years; however loans must usually be repaid by the age of 70, although this may vary for different islands.  Many of our products do not have any early redemption penalties.   For an idea of the rates available please contact us, or for a personalised quotation by clicking on Apply Now.


Documentation you will be required to provide

• Proof of identity (passports, driving licence, or other suitable photo ID.)

• Proof of residence (utility bill, bank statement etc. dated within the last 3 months)

• Proof of income (latest payslip, tax return, copy of accounts etc.)

• Proof of existing mortgage or rent payments (usually covering the last 12 months)

• Proof of deposit (last 60 days bank statements showing source of funds)

• Bank statements (usually last 60 days to show salary credits and outgoings)

• Property details (copy of sales particulars, or sales contract)

Documents will need to be either original or certified copies. Items such as passports and driving licences will need to be in date at the time the mortgage is due to complete or close.

Timeframe

We will issue a decision in principle within 48 hours of receiving a fully completed application. 

The processing time from the application being received by the lender to completion or closing is approximately 6 to 8 weeks.

Life assurance

Life assurance is not compulsory in the Caribbean.  However if you would like to receive a quotation for life cover please contact us and we recommend a provider to organise an illustration for you.

Buildings insurance

This is a compulsory part of the mortgage process, and can normally be taken through the lender or via an approved third party insurance company. This will need to be in place for when the mortgage completes or closes. Please contact us for an illustration.

Bank account

You will need to open a Caribbean bank account before completion, from which your mortgage repayments will be debited. This can also be used for utility bills, taxes etc. We can assist you in opening an account.

Payment of your Caribbean mortgage

Please be aware that missing a mortgage payment in the Caribbean may have serious consequences and we therefore strongly advise you arrange for monthly debits from your local bank account. A number of foreign exchange providers offer a renewable 12 month regular payment plan. The exchange rate is fixed at the start of the plan, and the agreed amount will be debited from your local account and sent to your Caribbean account each month. This service gives you peace of mind in the knowledge that your mortgage repayments will be met automatically each month. Please contact us to recommend a provider if this is of interest.

Transferring funds to the Caribbean

Whilst purchasing your Caribbean property it is also likely that you will need to transfer funds to the Caribbean, to pay a reservation fee, a deposit on the property, or to cover additional purchase costs. Making payments in a foreign currency will mean you are exposed to movements in exchange rates. This is likely to affect the final cost of the property you are buying, as will the exchange rate you receive when you make the transfer. Through our carefully selected foreign exchange provider we are able to not only save money on the exchange rate you receive but reduce your exposure to exchange rate movement.

For further information on how these services can benefit you please contact us and we will be able to answer any questions you may have.

Completion

You do not have to be present at completion and can give Power of Attorney if necessary. Your lawyer will be able to discuss this with you in more detail.

Costs of setting up a Caribbean mortgage

Bank’s arrangement fee: Typically 1% of the loan amount

Bank’s completion costs: vary

Valuation fee – varies according to the purchase price

Legal fees – typically 1% of the purchase price

Notary fees – your Notary can provide you with a breakdown of the fees payable on request.

Taxes - If you take out a Caribbean mortgage, there will be stamp duty, property transfer tax etc. to pay. This will vary from island to island, and you agent or lawyer should be able to provide you with a fully breakdown of what is applicable.

Buildings insurance – is payable to provide basic cover for the duration of the mortgage.

We charge a non-refundable application fee of £250.00.  A further fee may be payable on completion of the mortgage.  Please refer to your personalised quotation for confirmation.

We recommend that you seek professional, legal & tax advice before purchasing in the Caribbean

Your home is at risk if you do not keep up repayments on a mortgage or other loan secured on it. Be sure that you can afford the repayments before entering into any credit agreement. Any quotation supplied is not an offer of mortgage and may be subject to a change without notice. Exchange rate movements may increase the Sterling or home currency equivalent of your liability under a foreign currency mortgage.