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Has Anybody Recently Taken Out A Mortgage In Colombia

Dear All You Financial Wizzards and Home-owners,

My wife and I have found a new project in which we would like to invest/live.
In order to achieve that, we have 2 options:

1: If we sell our house in the next few months, no problem as we will not need to borrow at all. However, in the present financial climate, this may not happen in time.
2: If our house is not sold, we are thinking about raising capital on it until it is and at least partially finance the mortgage by renting it out.

What sort of interest rates can we expect to pay here and what sort of terms? What are the hazards and drawbacks? I have had a quick browse on the Web and have a few ideas. I have a reasonable level of experience of this type of thing back home but I have never borrowed money in Colombia.

Any advice on this matter would be much appreciated. Personal experiences are always better than web-sites!

Thanks

By kenblanquito on Mar 21, 2009, 18:09 in Friendly Talkzone.

bairespaisa says on Mar 21, 2009, 18:41:

My wife and I bought an apartment a little more than a year ago, we got a mortgage with Bancolombia. 15 years fixed, 16% interest.
She is colombian and im not, they still put me on the mortgage.

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whitewidow says on Mar 21, 2009, 18:51:

yep, spouse has to be colombian national to qualify. there are some lease options out there available for gringos, but the terms are not favorable for residential purposes.

I'm no doper! I just play one on TV.

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larryrn says on Mar 21, 2009, 18:59:

30 percent down - 15 years 16-18 percent is the going rate with good credit (grin). Much different than in the US, Panama or Costa Rica.. Plus taxes - watch out where you live - Poblado for example, the taxes are more than in Ft Lauderdale!! On the other hand in Envigado - taxes are very reasonable!! Larry

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scumbuster says on Mar 22, 2009, 05:01:

Looks like better off taking a personal loan from the US and buying in Colombia. OUCH 16%

Tomas Jefferson “When the people fear their government, there is tyranny; when the government fears the people, there is liberty.”

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makopp5 (☼Travelguide writer) says on Mar 22, 2009, 05:09:

larrym

what taxes? for the property? They are not high.

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bensark says on Mar 22, 2009, 07:07:

Anyone know roughly what are penaltys for early repayment of mortgages in Colombia?

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kenblanquito says on Mar 22, 2009, 07:43:

Many thanks for the responses.
scumbuster-a loan from home (UK) would be great but I would not qualify; shame because the interest rates are so low-my brother has a variable rate mortgage and pays 1% at the moment.
bensark-yes, information regarding early repayment penalties on Colombian mortgages would also be useful as that would certainly be my intention.
whitewidow-my wife is Colombian, which would make qualifying for the mortgage more simple.

One can see how difficult it must be to buy a home here. Even to purchase a very modest property with a 100 million mortgage, one is looking at repayments of over 1.5 Pesos per month. There are not enough quality jobs here to finance those repayments. Little wonder that renting or living with the family are so common here.

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scumbuster says on Mar 22, 2009, 08:17:

Not sure of the UK loan setups, but here if you have equity and good credit you can get a personal loan. Use the loan as you want, however it may be a little more difficult now in this economy. I am sure much lower than 16%. Here our mortgage rates are about 5%. So maybe about 7 or 8% on a personal loan if you have equity in a home or business to back the loan.
I have been thinking about this with the better exchange rate in Colombia and IF the real estate market drops as in has in the US.

Tomas Jefferson “When the people fear their government, there is tyranny; when the government fears the people, there is liberty.”

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kenblanquito says on Mar 22, 2009, 09:29:

Cheers scumbuster

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bairespaisa says on Mar 22, 2009, 14:27:

We have no pre payment penalty on ours, that was the first thing we asked when we got the loan !

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La_Huella says on Mar 22, 2009, 14:47:

Our mortgage is for 10 years, it's at 16.67%, and we had to put 50% down. No penalty for early payment.

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kenblanquito says on Mar 22, 2009, 17:22:

Thanks very much to all contributors.

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pavo says on Mar 22, 2009, 17:26:

Borrow the money as a hipotecario from Colombian bank and then pay as much back as possible when you sell the other property. You don't want to bring money from U.S. and then return it. It can be done but that is a large footprint you probably won't want to leave. However, if the dollar does fall significantly between the time you borrrow dollars and pay them back, you could make a nice little chunk. If the dollar strengthens, you could lose. No penalty for early payment. Watch out for the insurance though.

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Londoner says on Mar 29, 2009, 07:44:

Recently went for a personal loan in London,and got quotes of 7.9% over 5 years,up to 25K sterling.

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kenblanquito says on Mar 29, 2009, 07:53:

Londoner UK is a good place to borrow money at the moment; I never had a personal loan with an interest rate that low.

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