Financing your Dominican Republic home

As you may remember from our previous post Dos and Dont’s of Buying Real Estate in DR, we have already touched the subject of home loans and home financing in the Dominican Republic. We explained the basic information how you can get a direct owner financing if you buy from a big real estate developer. And today we would like to concentrate more on financing your real estate purchase through Dominican banks.

Bank requirements

The whole process of loan solicitation in Dominican Republic banks can be divided into two stages: pre-qualification and qualification. You will need to prepare and submit different documents on each of these stages. Moreover, the selling company or individual you are buying your apartment or villa from also needs to file certain papers. Dominican banks don’t have a universal list of requirements for recipients of home loans. In other words, each bank has its own conditions and set of required documents. So we decided to prepare a full list of all papers that a Dominican bank may ask you to provide. You may not need all of them but it’s better that you are fully informed. Besides, you can always check the information directly with the Dominican bank where you would choose to take a mortgage.

Pre-qualification documents:

  • Copy of your passport and Social Security or any equivalent document from your country.
  • Income certification (3-month bank statements or your last IRS certified income tax declarations and W-2 form for US Applicants or notice of assessments and T-4 form for Canadian Applicants, a letter from your employer or affidavit of income in case you are self-employed).
  • Minimum of 6 months of uninterrupted work in a company.
  • Letter authorizing the bank to request a Credit Bureau Report from your country of residence.
  • Payment to the bank to review your finance history outside the Dominican Republic.
  • Bank account in the currency that the mortgage will be repaid so monthly payments can be collected automatically.
  • Letter of reference from your 2 primary banks in your country of residence (not always required).
  • Evidence of assets in your country of residence.
  • 2 personal references from your country of residence (full names, address, occupation, phone number). This requirement is usually applied in Scotia Bank.
  • Proof of the down payment.

Qualification documents:

  • Application Form.
  • Life Insurance form filled out in the bank’s office (sometimes medical certification of good health).
  • Financial Statements prepared and signed by a Public Accountant (CA) with an Auditor’s Opinion, Balance Sheet, Profit and Loss and Cash Flow Statements (usually requested by Popular Bank for amounts exceeding 5 million DOP).
  • Copy of both sides of the property title (the original title also needs to be presented at the moment of the contract signature).
  • Property appraisal (no more than 18 months old).
  • Sales contract indicating the property selling price.
  • Certification from the Tax Office that all the property taxes are paid.
  • Legal status certification (not always applied).

Documents from the seller:

  • Certified act of the property sale and a valid copy of the identity document of the person authorized to proceed with the sale.
  • Copy of the company’s constitution papers.
  • Assembly act exclusively for the sale and describing the purchased property.
  • National Taxpayer Registration Number and copy of the person authorized to sign.
  • Valid Mercantile registry.
  • Condominiums rules and registrations (in case you are buying a condo in the Dominican Republic).

This list of required papers may seem huge but don’t forget it may change from one Dominican bank to another. In case you have any question or doubt, please feel free to contact our Finance Director.

Below you will also find a table with the interest rates of 6 different Dominican banks situated in the Dream City area.

Popular Bank, SosuaSanta Cruz Bank, SosuaBHD Leon Bank, SosuaLa Nacional Bank, Puerto PlataScotia Bank, CabareteReservas Bank, Sosua
10.95% fixed for 1 year

13.5% fixed for 5 years

20 years maximum

80% of the appraised property value

14-16% in DOP

9-11% in USD

20 years maximum

80% of the appraised property value

11% in DOP

20 years maximum

80% of the appraised property value

11.5% fixed for 1 year

12.5% fixed for 2 years

13.95% fixed for 7 years

14.25% fixed for the rest

30 years maximum

80% of the appraised property value

8.95% fixed for 5 years

20 years maximum

80% of the appraised property value

13-14%

7-9% for May’s Fair

20 years maximum

80% of the appraised property value

We hope this information was useful for you and you have learned something new about financing your home through Dominican banks. Please don’t hesitate to share this post with your friends who may be interested in this information. Also follow us on Facebook to keep getting useful tips on settling in the Dominican Republic.