Have US or Canadian home equity? Start with a HELOC. Want fixed-rate predictability on the foreign asset? A cross-border mortgage. Equity in a brokerage account? A portfolio loan. Skip local banks unless your situation is unusual.
1. Your real options
Most American and Canadian buyers picture two options (pay cash, or get a mortgage in the destination country) and assume the second is impossible. Both halves of that picture are usually wrong.
In practice there are six instruments worth knowing about, and most buyers will use one or two. A HELOC against your US or Canadian primary residence. A cross-border mortgage product structured for North American buyers, typically a 25-year amortization with a 5-year fixed reset. A local-bank mortgage in the destination country, where non-resident rates currently run roughly 8 to 13 percent depending on country and lender. Seller financing, especially common in Mexico, Costa Rica, and Belize. A portfolio loan against US securities (sometimes called a securities-backed line of credit). And all-cash, which most buyers underrate as an option until they price the alternatives.
Two more instruments come up less often than buyers expect. Self-directed IRA or RRSP purchases are technically possible but heavily restricted, and you can’t live in the property yourself. US 30-year fixed-rate mortgages on foreign property are effectively unavailable through retail bank channels.
Costs differ across the markets covered on this site. Mexico’s restricted-zone rules push fideicomiso setup onto the deal. Portugal’s IMT transfer tax sits on top of any financing choice. Costa Rica’s bank underwriting runs weeks longer for foreign buyers than for residents. The financing instrument doesn’t change those frictions, but it changes how much margin you have to absorb them.
2. Why local-bank financing is usually the worst option
Local-bank mortgages exist in most of the Latin American and southern-European markets covered on this site, but the rate Americans and Canadians get is rarely the rate locals get. Mexican banks publish non-resident mortgage terms several percentage points worse than the rates offered to nationals. Foreign-buyer income documentation doesn’t fit local underwriting models, so the bank prices the friction.[Banco de México, Sistema de Información Económica, 2026-04]
A working range to keep in your head: non-resident mortgage rates in Mexico run roughly 10 to 13 percent on peso loans, Spain and Portugal closer to 4 to 6 percent on euro loans (rates vary considerably with ECB cycles), and Costa Rica usually 8 to 11 percent on dollar-denominated products. Belize and the Dominican Republic have thinner non-resident lending markets where many deals close cash or via seller financing.
Add FX risk to the rate spread and the picture worsens. A peso-denominated mortgage at one exchange rate is one all-in number; the same loan at a different exchange rate is a different one. We’ve watched buyers move from “this is fine” to “this is upside down” inside 18 months on FX alone, without the rate ever changing.
Exceptions exist. Buyers earning income in the destination currency, buyers planning a permanent relocation who will eventually qualify as residents, and buyers with a specific tax-planning reason to debt-finance abroad can all run the local-bank math and find it works. For most cross-border buyers, it’s the most expensive of the available options and the slowest to close.
3. Why a HELOC works (until it doesn’t)
Pulling a HELOC against your US or Canadian home is usually the fastest path to closing on a foreign property. The bank already has your income documents, the property, and the appraisal. Approval can land in days, funds in two weeks. That’s a large compression versus the six-to-ten-week underwriting cycle a Mexican or Portuguese bank typically runs for non-residents.
The catch is variable-rate exposure. A US HELOC priced off the prime rate today reprices when the Federal Reserve moves, and you’re carrying that variance against an asset whose dollar-cost may already be sitting under your purchase basis.[Federal Reserve, H.15 Selected Interest Rates, 2026-04] Buyers planning short holds (under three years) usually find the HELOC math works. Buyers planning long holds should look harder at fixed-rate cross-border financing.
The second cost is encumbrance. Putting a six-figure lien against your primary residence changes your liquidity profile and your downside if the foreign property dips. A cross-border mortgage on the foreign property does not touch your domestic home. For buyers whose primary residence is their largest asset, that separation is worth real money.
Bank of Canada rate guidance and the OSFI B-20 stress-test framework are the underwriting reference points Canadian buyers will encounter when comparing domestic versus cross-border options.[Bank of Canada, Interest Rates, 2026-04][OSFI, Guideline B-20 Residential Mortgage Underwriting Practices, 2026-04]
4. What a cross-border mortgage looks like
Cross-border lenders that serve North American buyers usually structure the product the same way. A 25-year amortizing mortgage with a 5-year fixed-rate reset, qualifying off North American income (US W-2/1099 or Canadian T4), and a foreign-buyer down-payment minimum that varies by country and lender, typically 30 to 35 percent. We don’t quote specific rates on these pages because rates move with credit and market conditions, and a stale number is worse than no number.
The 5-year reset structure (rather than 30-year fixed) is deliberate. A Canadian-style mortgage matches how most of the world finances property; the US 30-year fixed is the outlier. For cross-border buyers, who rarely hold for 30 years anyway, that’s a feature, not a bug. Our companion piece on Canadian mortgage structure works through the case in full.
These products are not advertised through retail US bank channels. The lender ecosystem is fragmented across a handful of specialist cross-border lenders, US-domiciled brokers who place loans into international banks, and in-country lenders willing to underwrite foreign income. Sourcing the right one for your situation is most of the work, and the country mortgage pages map who serves which markets and on what terms.
5. When seller financing is the right answer
Seller financing closes a meaningful share of the deals we see in Mexico, Costa Rica, and Belize. The seller carries paper at a negotiated rate (often 6 to 9 percent in dollars) for a 2 to 5 year term, with a balloon payment at the end. The buyer refinances or sells before the balloon hits.
It works when bank financing is hard to get: raw land, ejido title, or unusual property types that don’t fit standard underwriting. It also works when speed-to-close matters and you cannot afford to lose the deal waiting for non-resident underwriting. It fails when the seller’s terms are buried in a Spanish-language contract you didn’t have local counsel review. The savings on seller financing go to zero if the contract bites you in year three.
Our companion article on seller financing covers the contract specifics, what to look for and what to walk away from, including traps that have cost cross-border buyers the property they nearly paid off.
6. How to choose
Start with your hold horizon and where your equity lives.
Under three years with substantial US or Canadian home equity? A HELOC is usually the right call. Five years or longer and you want fixed-rate predictability on the foreign asset? Look at a cross-border mortgage. Sitting on a US brokerage account you’d rather not liquidate? A portfolio loan against your securities can fund the deal without triggering capital gains, though margin-call risk in a drawdown is the trade-off. Cash with no high-yield alternative use of the capital? Pay cash. Bank financing unavailable on the property type? Seller financing, with local counsel.
Then layer in country-specific friction. Mexico’s fideicomiso adds setup cost but doesn’t change financing structure. Portugal’s IMT and stamp duty are flat percentages on top. Costa Rica’s underwriting timelines compress your option set if you’re working a specific deal. Belize and the Dominican Republic effectively rule out local-bank options for most non-residents, pushing more deals into cash, HELOC, or seller financing.
For most cross-border buyers right now: HELOC for short holds, cross-border mortgage for long holds, seller financing when bank financing isn’t available, portfolio loan if you’re sitting on appreciated securities, cash only when the alternative use of capital wouldn’t outperform the implied yield on the property. The instruments are durable; the relative costs move with rate cycles and FX.
Common questions
Can I get a US 30-year fixed-rate mortgage on a foreign property?
Effectively, no. The US 30-year fixed is backstopped by Fannie and Freddie, and those agencies don’t securitize loans on properties outside the US.[Fannie Mae Selling Guide, Eligible Properties, 2026-04] A handful of US private banks will underwrite foreign-property loans for high-net-worth clients on bespoke terms, but they don’t look like a conventional 30-year fixed.
Will my US or Canadian credit score help me qualify for a foreign mortgage?
For cross-border lenders structured around North American buyers, yes. Your domestic credit profile is the qualifying input. For local banks in Mexico, Portugal, or Costa Rica, a US or Canadian score has no direct value to their underwriting, though some banks accept a translated credit summary as supporting documentation.
Can I use my IRA or RRSP to buy property abroad?
Self-directed IRAs and RRSPs can technically hold foreign real estate, but the rules are restrictive. The IRS prohibits self-dealing, which means you cannot live in the property, vacation in it, or rent it to family.[IRS Publication 590-B, Distributions from Individual Retirement Arrangements, 2026-04] The CRA’s RRSP qualified-investment rules are tighter still and exclude direct foreign real estate in most cases.[Canada Revenue Agency, Registered Retirement Savings Plan (RRSP), 2026-04] Run any structure past a cross-border tax advisor before committing.
How big a down payment should I plan for?
For cross-border mortgage products, plan for 30 to 35 percent down as the foreign-buyer minimum. Local banks underwriting foreign income often require 40 to 50 percent. Cash buyers face no minimum, but should still hold reserves for closing costs (typically 6 to 8 percent of purchase price across most cross-border markets).
Do you publish current rate sheets?
Not publicly. Rates move week to week and lender-to-lender, and a stale published rate is worse than no rate. The country mortgage pages cite the most recent verifiable ranges from public lender disclosures and central-bank reporting.
Where to go next
If you’re choosing between a HELOC and a cross-border mortgage on the same deal, our HELOC vs cross-border mortgage comparison walks through the math case by case.
If you’re Canadian, the Canadian mortgage structure abroad page covers how T4 income, OSFI B-20 stress testing, and the 5-year reset shape your options.
If you’re looking at seller paper in Mexico, Costa Rica, or Belize, the seller financing explained page covers the contract terms that matter.
For country-specific lender ranges and underwriting timelines, see Mexico cross-border mortgage market, Costa Rica cross-border mortgage math, Portugal non-resident mortgage, Spain non-resident mortgage, or Italy’s mutuo per non residenti.
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