A person considering applying for real estate financing

Property Financing in Cabo for Foreigners

September 15, 2025 | By: Jeffrey Schmidt

Many people from the United States, Canada, and other parts of the world would like to purchase property in Cabo San Lucas or San José Del Cabo. However, financing options for foreigners are limited. Since the great recession, U.S. banks no longer offer loans to purchase property in Mexico. Still, there are some property financing options available to foreigners if these solutions meet your needs and circumstances.

Types of Financing Available

If you are looking to finance your home, condo, or lot in Cabo, expect short-term loans and higher interest rates. In some ways, these can be thought of as hard money loans. Typically, financing makes sense if you just need a band-aid loan and have property or other assets that you plan on selling in the next couple of years.

Developer Financing

New developments or pre-construction projects sometimes allow buyers to finance directly with the developer. Terms may include smaller down payments. However, you can expect shorter terms and balloon payments at set intervals. In addition, if you opt for financing, there isn’t as much wiggle room when it comes to getting the best price for the property.

Seller Financing

In some cases, the seller may act as the lender. These deals are less common, but can provide more flexibility. Most sellers want about 50% down, with the full cost of the loan paid off within one to five years. Again, there you are less likely to be able to negotiate a lower price if you opt for financing, and you will likely be paying interest on the loan.

Private Lenders

There are private or non-bank lenders, sometimes with more flexible but more expensive financing. Global Moxi Mortgage typically expects 35% down, and interest rates are typically in the double digits. The interest rate will depend on the price of the property, your credit score, and the loan amount.

Local Bank Mortgages

Mexican banks don’t typically offer mortgages to foreigners, but there are some exceptions. Kapital Bank (formerly Intercam) has offered real estate loans to foreigners, though the terms are stricter and down payments and interest rates are usually high.

Proceed With Caution

It is important to note that if you choose to finance a home, condo, or lot in Cabo, but then default on the loan, the lender will take over the property and all previous payments will be lost. For this reason, it is very important to be cautious when financing a property in Mexico. It really only makes sense if you are sure you have capital coming in soon so you can cover the remainder of your loan balance.

In most cases, Jeff Schmidt, a real estate agent in Cabo since 2013, recommends that buyers purchase property that they currently have the cash to afford. Staying within your budget, and accounting for additional fees like closing costs, is critical to making sure your real estate transaction goes forward with as little stress as possible.