Property Mortgage in Panama
The banking system in Panama is mostly constituted by private banks, many with international capital. With over 80 banks, banking in Panama is positioned as the most important in Central America. Moreover, Panama offers a strategic location for these banks to operate. With the new banking laws implemented in Panama to avoid money laundering and terrorist activities, makes the Panama Banking system a secure place to deposit investor’s capital. Most importantly, foreigners can qualify for a property mortgage in Panama. However, most banks prefer that the customer has been a resident for at least 2 years. Also, having an existing bank account makes it easier.
To open a new bank account in Panama is not as easy as in the past and as it is in western countries. Nevertheless, the new process guarantees security and reliability for the customers and protects the Financial System in Panama.
The interest rates will vary between banks, however, you can expect anywhere from 6% to 7.5% and up to 25 years term. The amount will also vary, however, a 70% financing of appraisal value is very typical in most banks.
General requirements:
- Assessment of the property
- Fire Insurance for 100% of the value of the improvements on the property
- Life Insurance for the amount of the loan
- Legal Expenses and registration of the deed
Documents Required:
- Proof of income: It can be a work letter, proof of social security or private retirement fund
- The last two income tax statement. If self-employed, then the last tax return of the business
- Two bank references from your home country
- Credit report from your home country
- Verification of personal assets (shares certificates, bonds, properties, bank statements)
- Copy of passport and additional identification card
- Copy of the purchase-sale contract
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