Residential loans in Panama are classified into 4 types:

Residential: is one that will be used as main dwelling. This would be considered your primary residence. In general terms for residential loans vary between 20 to 30 years and can get financing from 50 to 90% of the total value of the purchase.

Summer House: generally is one purchase that its purpose is of partial use, theoretically they are located outside of the city of Panama in the beach or mountain  area. The financing terms usually range from 50 to 80% of total purchase, with repayment terms between 10 and 25 years.

Investment Loan: is used to acquire a property for the purpose of resale or rental. The financing terms usually range from 50 to 70% of total purchase, with terms between 10 and 20 years of repayment.

Construction Interim Loan: a short-term loan for the construction of a home that usually lasts between 12 and 24 months. At the end of the construction this becomes a long-term loan that can be used for any of the three previously mentioned purposes.

Improvements: is the construction of a house that is already built. Banks offer financing from 50 to 90% of an recent appraisal. The term of repayment is linked to the classification of the property: primary residence, vacation or investment.

Land: financing for the purchase of land for any use. Between 40 and 60% financing with a repayment period of 10 to 15 years.

For more information on residential loans in Panama please see our article: 

”Panama Mortgage Loans”

If you need help finding your dream property in Panama let our licensed real estate brokers help you with your search.

For more useful information about moving to Panama contact one of our experts today.

What is the utility of a mortgage broker service?

The mortgage broker has the expertise and updated loan policies of each bank that change frequently. This is important to evaluate your case promptly and assist you in the selection of potential banks.

We have excellent relations with all the banks in Panama that offer mortgage products, which assures you expedited processing of your loan and a high level of service. We believe in complete transparency and provide a high customer service with monitoring the process of  your loan. We are the right hand of the banks in Panama.

Why do I need an appraisal?

One requirement of the bank is that at the time of disbursement to check the accuracy of the property value. This applies to any type of loan and housing both built and pre-construction.

Are there penalties if I pay my loan before the agreed term?

Yes, generally equivalent between 1 to 3% of balance due to the date when the payment is made for cancellation of the loan. This penalty is usually applied during the first 5 years of the loan.

What are the costs associated with a loan?

The payment for our facilitation services, closing costs fees which vary between 0.5 to 2% of loan amount and the life insurance and fire insurance policy.

Why I need a life insurance policy for my mortgage loan in Panama?

Life insurance policies are to ensure that if the payer of the loan were to pass away, the family does not stay with the debt of the property.

What is the difference in getting my insurance with the bank or an insurance broker?

The policies of banks are collective, so always apply higher rates and the benefits of life policy belongs completely to the bank.

An insurance broker can quote rates from several insurance companies by getting you more economic options and the benefits of life policy are shared between the bank and your beneficiaries. Therefore, if the payer of the loan were to pass away, the indebted amount would go to the bank and the rest would be for your beneficiaries (family).

For more information on the required insurance policies for a mortgage please see:

“Insurance Guide for Mortgage Loan in Panama”

For more useful information about moving to Panama contact one of our experts today.

Who qualifies for a loan in Panama?

Both Panamanian and foreign residents and non residents can apply for a mortgage in Panama. The banks in Panama have created mortgage products designed specifically for both segments.

How do I qualify for a loan in Panama?

To apply for a loan in Panama is necessary to have good credit references, have a stable income, both as an employee or as an independent and have sufficient capacity to repay debt.

At the time of applying for the credit is very helpful to have an existing relationship with the bank. It is your responsibility to provide timely documentation required by the financial institution, as it could otherwise delay the application period.

We recommend having a recent appraisal, not more than 6 months and satisfy the insurance requirements such as a life insurance and a fire insurance policy. 

One can apply individually or jointly (requires separate life insurance policies). The term of repayment will be linked to greater age. The age ceiling for the repayment of a mortgage loan in Panama is 75 years old.

What goes on a disbursement of a loan?

After your loan is approved and you have met the requirements for disbursement of the same, the bank and the developer must register the deed in the Public Registry of Panama to transfer the property title to the buyer. Having obtained the property title the disbursement will be done. This process usually takes between 3 and 8 weeks.

Time frame and steps to obtain a mortgage loan in Panama

1. Having a selected property (our licensed real estate agents can assist you in your search for your perfect property)

2. Consult with one of our mortgage brokers for a pre-approval of credit, which our consultant will  assess your value, which you will obtain within 72 hours.

3. Ingress the documents to the selected bank for credit approval. This usually takes between 1 to 4 weeks.

4. Once approved your credit, you must make the corresponding payment amounts to the part that the bank does not finance established in the contract of sale.

5. Obtain a life insurance policy for the amount to be financed and a fire insurance policy for the full value of the property. Our insurance brokers will assist you in obtaining the policies. The life policy can take up to a month to obtain.

6. Open a bank account, which will be used to make the monthly loan payment.

7. Cover with closing costs of the loan as payment for legal costs,  notary, among others.

For more useful information about moving to Panama contact one of our experts today.