Difficult to Finance Islands
We get inquiries daily for Islands all over the Caribbean. Some, like the Cayman Islands, TCI and The Bahamas are no problem, others can be very difficult. Here is a quick look at some of the reasons why some Islands can be difficult or even non starters when it comes to mortgage financing.
Foreclosure Laws
St. Martin is a great example of a country who has very difficult foreclosure laws for mortgage lenders. Because the country is a French colony, it follows French laws, which make it very difficult for lenders once a mortgage slips into foreclosure. This deters lenders from doing business on the island, making it a very difficult island to buy property (assuming you need financing). On the flip side (literally), Sint Maarten follows Dutch laws which are more favorable for lenders meaning financing is an option.
These laws are also the reason why citizens of islands can be difficult for us to finance, as foreclosing on them can be very tough for lenders. For this reason, many of our lenders simply choose to work with expats and non residents where foreclosing is not an issue.
Marketability of the Location
Location, location, location. This old adage is maybe more applicable to the Caribbean than anywhere else. Borrowing money on Providenciales is not usually a problem, however financing a property on Middle Caicos can be a lot more difficult, If the demand is that location is low, lenders will avoid that location.
Our lenders are generally more interested in tourist and mid to high end properties. These properties have higher marketability and will be easier to sell in a foreclosure situation.
The Economy
Since 2008, the economy in the Caribbean has been slow to rebound. Some islands have bounced back quicker than others however, making them an easier location to finance for us. The flip side is obviously some islands have not bounced back, and financing properties there can be a challenge.
This one can be a bit fluid as the market changes, and certainly there will be exceptions based on the right deal. So talk to us today about your location and situation, to see if mortgage financing may be an option on your island of choice.
