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Financing

Ecuador is one of the best places in the world to purchase real estate. It’s just one of the many factors that has led to its reputation as one of the best places to live, ever. Buying and financing a real estate purchase in Ecuador may take some time getting used to for foreigners, but with an expert on Ecuador real estate on your side, navigating the processes and closing a transaction successfully can be a smooth and hassle-free experience.

Ecuador real estate is supercharged

Ecuador has experienced a real estate boom in the recent years, enticing real estate investors from all over the world. As long as you have a valid visa with you, you are entitled to all legal rights accustomed to Ecuadorian citizens when purchasing a home. Few constraints, great value, low cost of living, and steady economic growth are other perks that will convince you to invest in Ecuador real estate.

Real estate financing in Ecuador

Navigating the world of real estate financing in Ecuador is best done with a local real estate expert and a lawyer or public notary on your team, not only for their expertise but to break down language barriers as well, especially if you’re not fluent in Spanish.

It’s important to understand that unlike in the United States, real estate transactions in Ecuador are highly localized. There aren’t any multiple listing services in the country. Most home sellers require a down payment if you intend to purchase the property, with the rest of the value deferred over a period of one to seven years.

Ecuadorian banks and other financial institutions in the country prefer short term financing, with Ecuador only having a rather limited mortgage market. One of the main reasons why banks avoid long term funding is to limit their exposure. Ask your local real estate agent for preferred lenders and take your agent with you as you shop for mortgage.

Like anywhere else, purchasing a home in Ecuador also comes with an array of associated costs. Aside from fees to be paid to your lawyer, you’ll need to shoulder the following fees:

    • Transfer tax – Payable to the local municipality where the property is located, the transfer tax is a flat rate of 1 percent of the property’s market value or official property value, whichever is higher.
    • Notary fee – Charged as .10 percent of the property’s value and includes general expenses.
    • Provincial transfer tax – Payable to the provincial council, the provincial transfer tax is charged at approximately US$510 + .11 percent of the property’s market value or official property value, whichever is higher.
    • Registration fee – Levied at .10 percent of the property’s value.
  • A typical home buyer in Ecuador usually shoulders 2.31 to 4.31 percent of transaction costs, whereas the seller, who pays for the real estate agent’s fee, covers 4 to 6 percent of the total transaction costs.

    Find out more about real estate financing in Ecuador

    Talk to our representative at Live the Life today for more information about real estate financing and home buying in Ecuador.