Financing a Property

Mortgages: You are probably familiar with the types of mortgages that are available in Puerto Rico, since they are the same as the United States:

Conventional: This is the loan to get if you have 20% available for a down payment, because their will be no mortgage insurance involved. Even with 10% down, mortgage insurance requirements will be less than other mortgages. Rates can be fixed or adjustable.

FHA: Insured by the Federal government. This loan is popular if you have very little available for a down payment, moderate income, or a less than perfect credit history. These loans are assumable when you sell, as long as the new buyer qualifies to take it over.

VA: Guaranteed by the Federal Government. This loan is great for those who are serving, or have served in the US Armed forces. Widows of veterans also qualify, if they have never remarried. A buyer using a VA loan can literally buy with $0 down, but typically there are some costs involved. These loans can be assumed in the future, if a release of liability is obtained.

Second Mortgage/Equity Line of Credit: This is a “junior” mortgage that can be placed on real estate, and is subordinate to a first mortgage.

Seller Carry-Back: In rare cases, a seller will offer a mortgage on the home. This does not happen very often, and usually because the buyer does not have enough down payment. Lower rates, and reduced closing costs are common.

Because there are so many mortgage selections, we recommend that you get in touch with one of our TIRI Associates to help guide you through the choices. Please contact any of our offices for additional information.

Items you may need to get a mortgage

You will be happy to know that financing for residential properties is easily available, and at terms and conditions that are very favorable. If you are not a citizen of the United States of America, long term, fixed rate financing is also available for your purchase.

Following we are providing you with a list of items that you may be required at time of loan application.

Addresses where you and the co-borrower have lived for two full years. Renters need to bring name and address of landlords. Owners need to bring name, address and account number of the mortgage company.

Names and address of all employees for the past two years. Current pay stubs showing earnings year to date. W2's for the previous year or past year tax returns.

Self-employed persons must bring the most recent two years tax returns, a current years Profit and Loss Statement to date, plus a personal financial statement. If the self-employed business is incorporated, you must bring the above items on the corporation. All tax returns must be signed by the borrower.

Social Security numbers on all borrowers.

Names and addresses of all banks, savings and loans, credit unions, etc... where you have funds on deposit and their account numbers, plus copies of most current statements

Names, addresses and account numbers of all current monthly payment accounts. This includes banks, mortgage companies, finance companies, credit unions, etc... Please have the amount of payments and the approximate balance (plus copies of most current statements, if possible).

Names, addresses and account numbers of all credit cards, except gasoline cards (plus most current statement on each card, if possible).

You may need a copy of your divorce decree if you have ever been divorced.

Bring a copy of the complete bankruptcy proceedings and discharge filed and a list of creditors, if applicable.

If you have sold your current home, you will need a copy of the Sales Contract. Make sure that all additions to the standard contract are legible. (Addresses, legal descriptions, amount, contains all necessary signatures, initials, etc...)

For FHA mortgages - copies of your Social Security cards and Driver's license and child care expenses, if any.

If you are receiving gift funds, the lender will require that the funds be verified in the donor's account. Consult your agent for a gift letter form. If you are applying for a conventional mortgage, you will need to show at least 5% of your own funds.

**Please note that if you have all the above information on your first trip to town and if you decide on a home to buy then you will be able to do your loan application before you go back home.

At TIRI we have a complete finance department to help you with all of your financing needs. We invite you to contact any TIRI offices to begin the process, or click here to request information via the web!