There are several ways to finance real estate transactions in Mexico. While the majority of foreign owned property in Mexico is still purchased with cash, a growing mortgage market is opening up new avenues for investors to leverage their assets.

Here are a few of the financing options available for purchasing property in Mexico:

• Mortgage Financing: Traditional mortgages can be obtained through many banks.
• Real Estate IRA: Retirement funds can be used to purchase real estate in Mexico as an asset in a retirement portfolio.
• Hard Money Loans: High interest loans can be obtained through hard money lenders.
• Seller Financing: Private mortgages can be arranged through the seller of the property, although this is not common in Mexico.

When financing property in Mexico, it is also important to recognize Mexico’s restrictions on foreign ownership of property. The majority of property owned by foreign investors in Mexico falls within the ‘restricted zone,’ which is 100 km from any Mexican border, or 50 km from any coastline. Foreign ownership of property within these zones is possible through a type of real estate trust known as a ‘fideicomiso,’ which gives title of the property to a Mexican bank, while granting full ownership rights to the foreign buyer.