How Financing Works For Property In San José

Thinking about a condo or pied-à-terre in San José but not sure how financing works in Costa Rica? You’re not alone. The mortgage process looks familiar in some ways and very different in others, especially if you’re used to U.S. or European lending. In this guide, you’ll learn the local loan options, what banks require, how currency and rates work, timelines, costs, and the alternatives many international buyers use. Let’s dive in.

Mortgage options in San José

San José offers several ways to finance a purchase, each with its own pros and considerations.

• Traditional bank mortgage. This is the most common route. The loan is secured by a mortgage lien called a hipoteca that is recorded with the national registry. Banks look closely at property type, title, and building status.
• Developer financing. Often used for new condos during construction. You make staged payments to the developer, then secure a final mortgage when the building is complete and your unit is ready for title transfer.
• Seller or private financing. You and the seller agree on terms, rate, and repayment schedule. This can help if banks require a higher down payment or if underwriting is slow. The agreement should be documented and recorded just like a bank mortgage.

Condominiums with established developers and complete building documents are usually easier to finance than projects still working through registration. If you are considering pre-construction, expect your bank mortgage to start once the building is complete and your unit can be titled and registered.

What lenders look for

Eligibility and typical LTVs

Costa Rican lenders work with residents and non-residents. If you hold residency, you can often access more favorable terms. If you are a non-resident, expect stricter underwriting and a larger equity requirement.

• Residents buying a primary home often see loan-to-value ratios around 70 to 80 percent, depending on the bank and profile.
• Non-residents and investment properties, including many condos, commonly see 50 to 70 percent LTV.
• New developments may have lower LTV caps until the building is fully registered.

Your exact LTV will depend on your residency status, income documentation, property condition, and the specific bank.

Documents you will need

Banks focus on clear proof of identity, income, and funds, along with clean property title. Plan to prepare:

• Identification: passport for foreigners, or DIMEX card if you are a resident.
• Proof of income: recent payslips and an employer letter, or client invoices and tax returns if self-employed. Foreign documents often need a certified translation and apostille or legalization.
• Bank statements: commonly 3 to 12 months.
• Tax returns: personal, and corporate if you are buying through a local company.
• Credit history: international reports may be used to supplement local references. Some lenders may ask for local references or a co-signer.
• Source of funds: evidence for down payment and closing costs to satisfy anti-money laundering checks.
• Property file: title certificate, cadastral plan, condominium bylaws, and municipal and utility certificates.

If you purchase through a Costa Rican company, the bank will review the corporate structure, signatories, and beneficial owners. This is common, but it can add steps to underwriting.

Condos and new developments

For condominiums, lenders verify that the condo regime is legally registered, the homeowners association is established, and each unit can be titled with its own registered parcel. For pre-sales, developer financing typically covers construction, and you complete your bank mortgage after final registration when the escritura pública can be granted to you.

Currency, interest, and how payments work

You will usually choose between a mortgage in Costa Rican colones (CRC) or U.S. dollars (USD). The right choice depends largely on your income currency.

• Currency match. If you earn in USD or EUR, borrowing in USD can reduce exchange risk. If you borrow in CRC while earning in USD or EUR, your monthly payments will move with the exchange rate.
• Rate structures. Lenders offer variable or mixed-rate loans, and sometimes a short initial fixed period that later adjusts. Rates vary by bank, borrower profile, and currency.
• Amortization. Residential terms typically run 15 to 25 years. Some lenders consider longer terms case by case.
• Required insurance and fees. Expect property insurance and often life or loan-balance coverage. Banks also charge appraisal, origination, and registration fees. These vary by lender and loan size.

Because rates and bank products change, request current quotes early. Ask lenders to show you monthly payment differences between CRC and USD options and to outline how often a variable rate can adjust.

Step-by-step financing and closing timeline

A well-organized file keeps your closing on track. Here is the typical flow for a financed purchase.

1. Pre-approval and budget. Share your income documents and target property type with a lender to gauge eligibility and LTV. This helps you set a realistic budget and timeline.
2. Offer and promesa de compraventa. When you reach terms with a seller, you sign a purchase promise agreement and place an earnest deposit. The agreement sets your due diligence timeline and financing conditions.
3. Due diligence. Your attorney conducts a title search at the national registry, reviews the condominium bylaws and minutes, and confirms municipal and utility status. If needed, commission a survey or cadastral confirmation.
4. Appraisal and underwriting. The bank orders a formal appraisal and reviews your file. Respond quickly to document requests to keep the process moving.
5. Escritura and mortgage signing. Once underwriting is complete, you sign the public deed and the mortgage before a notary public. The notary files the deed and mortgage for registration.
6. Disbursement. After signing, the lender releases funds per the contract, often via the notary’s trust account or bank fiduciary service, and the mortgage is recorded.

Timeline expectations:

• Cash resale: about 2 to 6 weeks, depending on title clarity and availability of the parties.
• Purchases with a mortgage: commonly 6 to 12 weeks from application to registration, and sometimes longer if extra documentation is needed.
• New developments: your final mortgage usually waits until the building is complete and your unit can be titled.

Closing costs and ongoing expenses

Plan for both government and lender-related costs. Exact amounts vary, so ask your attorney and lender for a written estimate.

• Transfer tax: commonly around 1.5 percent of the purchase or declared value.
• Notary and registration: often 0.5 to 2 percent combined, depending on value and complexity.
• Mortgage costs: appraisal, origination, and mortgage registration fees. These can total from several hundred to a few thousand USD equivalent.
• Insurance: property insurance and, in many cases, life or loan-balance coverage required by the bank.
• Property taxes: municipal property tax is generally modest by international standards. Confirm the current rate with the municipality.

Request a line-item estimate early so you can plan cash needs for the down payment and closing.

Alternatives to traditional bank loans

If a bank mortgage is not the best fit, you still have options.

• Developer financing. Common for new condos, with a reservation fee and progress payments through construction. You typically complete a bank mortgage at delivery if you are not paying the balance in cash.
• Seller financing. Negotiate the down payment, rate, and term with the seller. Ensure your attorney drafts the agreement and records the mortgage to protect both parties.
• International and regional lenders. Some banks operating in Costa Rica offer products for foreign buyers. Eligibility and documentation vary.
• Home equity from your home country. Some buyers tap equity in an existing home abroad to purchase in Costa Rica. This involves cross-border lending relationships and careful planning.

Working with an experienced local attorney and, when useful, a bilingual mortgage broker can help you compare structures and protect your position.

Practical tips for North American and European buyers

• Prepare translations. Banks often require notarized translations and apostilles for foreign documents.
• Show source of funds. Be ready with clear evidence for your down payment and closing funds.
• Confirm currency and payments. Ask whether you can borrow in USD and how monthly payments are processed.
• Understand insurance. Clarify required property and life or loan-balance policies and who provides them.
• Lean on local counsel. Engage a Costa Rican real estate attorney early for the promesa, escrow arrangements, and the escritura.
• Verify condo documents. Review bylaws, budgets, and meeting minutes so you understand rules, fees, and building status.
• Get a full cost sheet. Ask your lender and attorney for a detailed breakdown of closing costs and timing for deposits, progress payments, and final funds.

Bringing it all together

Financing a property in San José is straightforward when you plan ahead and align the loan to your profile, currency, and timeline. Know your LTV range, assemble a complete document file, and build a team that includes a trusted attorney and a lender comfortable working with international buyers. If a traditional mortgage is not ideal, developer or seller financing can bridge the gap for the right property.

If you would like a tailored financing game plan and curated property options in San José, connect with an advisor who understands cross-border buyers. Start the conversation with Dawn Wolfe to explore next steps and opportunities.

FAQs

Can non-residents get a mortgage in Costa Rica?

• Yes. Many lenders work with non-residents, though underwriting is stricter and down payments are often higher than for residents.

How much down payment is typical for a San José condo?

• Expect 20 to 50 percent depending on residency, lender, and whether the property is considered an investment. Condos often require the higher end of that range.

Are mortgages available in USD as well as colones?

• Yes. Many lenders offer USD and CRC options. Matching your loan currency to your income can reduce exchange rate risk.

How long does a financed purchase take to close?

• Plan for about 6 to 12 weeks from mortgage application to signing and registration, depending on documentation and lender timelines.

What costs should I budget for at closing?

• Common components include transfer tax around 1.5 percent, notary and registration fees, appraisal, lender fees, and required insurance. Together, these often add several percent to the purchase price.

How does escrow typically work in Costa Rica?

• Deposits and closing funds are often held in an attorney’s trust account or a bank fiduciary account and released according to the contract and closing conditions.