As the cost of living rises faster than incomes, paying for everything in cash — especially big-ticket purchases — is becoming increasingly difficult for many people.

In a recent MND financial survey, just 3.6% of respondents said they had borrowed money to make a major purchase in Mexico. Yet more than half said they had lent money to someone while living here, and 22% of those lenders had loaned more than US $3,000.

While the survey was not scientific, the fact that many MND readers engage in private lending suggests plenty of financial need in Mexican society that traditional banks are not meeting.

To be clear, it isn’t all bad. Access to formal credit in Mexico has improved in some areas, particularly with auto sales, but remains much more limited in others, such as housing.

So, what financing options are available for those looking to buy property in Mexico? Below, I’ll explore the possibilities, from conventional mortgages to alternative financing.

Borrowing money for a home purchase in Mexico

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It may surprise you to learn that only 10% of home purchases in Mexico today involve a mortgage. The other 90% are paid for in cash or through alternative financing methods.

One reason so few buyers use mortgages is that Mexican commercial banks are very cautious, viewing large home loans to ordinary people as too risky. So, they require large down payments and charge high interest rates. As a result, buying a home with a mortgage is simply unaffordable for many Mexican residents.

At the same time, property prices in Mexico — especially in major cities and popular coastal towns — have risen to levels that are high relative to local incomes. This makes access to mortgage financing more important than ever for people hoping to buy a home.

Who offers mortgage loans in Mexico?

In general, U.S. banks do not finance properties in Mexico. To obtain a mortgage here, buyers must work with a Mexican bank that originates loans.

The most active lenders are some of the nation’s largest banks, including BBVA México, Banorte, Santander México and HSBC México.

Mortgage rates are steep and many applicants get denied

In the first half of 2026, mortgage loans from Mexican banks ranged from 8.8% to 11.35%, depending on the lender, with the total annual cost (CAT) including the rate, bank fees and insurance between 11% and 13.9% per year.

Mortgage rates vary based on the amount requested, down payment size, loan term and the quality of your credit profile. Since loan terms are complex, bank regulator Condusef (National Commission for the Protection and Defense of Users of Financial Services) offers a Mortgage Loan Simulator to help consumers more easily compare offers.

Besides high borrowing costs, down payments are also typically higher in Mexico than in the U.S. or Canada. It’s common on a resale property for the buyer to put 20% to 30% down, though some lenders require 30% to 50% if the buyer is a foreigner. One exception is developer-financed properties, which often accept 5% to 10% down initially.

Mexican banks typically offer mortgage loan terms ranging from 10 to 25 years, with 20 years being most common. The entire process takes anywhere from three to five months — so patience is essential.

Even after a long wait, success is not guaranteed.

According to El Economista, only one in four mortgage applicants in Mexico is successful. I’ve seen these low odds play out firsthand, as my husband and I purchased our home in Guadalajara only when the initial buyer was denied a loan and backed out of the deal.

Getting a mortgage in Mexico as a foreigner

Most Mexican banks offer mortgages only to foreign nationals who hold legal permanent residency. Those with temporary residency — and tourists — though legally permitted to buy Mexican property, cannot secure mortgages here, for lack of credit history.

The application process typically involves review and approval by the bank’s credit department, followed by a property appraisal and legal review.

While requirements differ, most lenders ask for the following documents from borrowers:

• Identification: Official ID (passport, CURP)

• Proof of income: Usually recent pay stubs, tax returns or income statements

• RFC number: Mexican tax ID

• Credit history: A good credit score is essential

• Credit reference letter: From a financial institution you do business with abroad

• Down payment: Anywhere from 30% to 50% of the property value

• Medical certificate Confirming that the applicant is in good health

It’s also important to know that Mexican banks require that borrowers hold homeowner’s insurance. This must be secured before your loan can be approved. If you buy property here without a mortgage, the choice of whether to buy an insurance policy is up to you.

Alternatives to traditional mortgages

Developer financing for new or not-yet-built properties

This is another option popular with foreign residents who are unable to pay all cash upfront. To attract buyers, most developers accept staggered payments for the purchase.

For example, you might be asked to put 30% down when you sign a contract, with additional payments required in 6- or 12-month intervals, with those future payments being financed by the developer. Because these loans aren’t done through traditional banks, they may carry higher interest rates.

Because I’ve heard plenty of horror stories about Mexican developers who take investors’ money and fail to deliver the property, I would steer clear of any real estate project not yet built. Legal recourse for property deals gone sideways is slow and arduous — and just not worth the risk in my opinion.

Cross-border mortgages

A newer option in Mexican housing finance is mortgages involving a bank in the borrower’s home country that lends money for property purchase in Mexico. For a U.S. citizen, this would entail taking out a dollar-based mortgage originated in the United States.

One company in the cross-border mortgage business is Moxi, which offers dollar-based mortgages for up to 30-year terms at fixed interest rates. The catch is that the minimum loan size is US $250,000, and borrowers are expected to put at least 35% down on the purchase.

These lenders are generally willing to work with legal foreign residents or visitors on tourist visas. However, those with non-resident status typically pay higher interest rates.

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Because cross-border mortgages have such high minimums, they are only useful to those intending to buy luxury properties in Mexico, meaning those valued above US $460,000 or roughly 8,404,265 pesos.

Government-backed loans

For those with formal employment (including foreign residents) in Mexico, public financing is another option for accessing housing credit.

Infonavit, the Mexican federal institute for workers’ housing, is the largest mortgage lender in Latin America with more than 12 million mortgages on its books. There are numerous criteria to qualify, but anyone with a steady employment history whose employer has been regularly paying into the mandatory public housing fund is a strong candidate.

Borrower benefits include lower interest rates than commercial mortgages (3.69% to 10.45% right now), fixed rates over the life of the loan, and loan terms ranging from one to 30 years. An interesting twist with Infonavit loans is that lower earners pay lower rates while higher earners pay higher ones, the opposite of commercial lenders.

The catch with these public loans is that the amount borrowed cannot exceed 2.935 million pesos (US $131,087).

To wrap up, taking out a mortgage in Mexico is a major decision. Before moving ahead with a property purchase in Mexico with financing, I recommend seeking the opinion of a qualified financial advisor.

From tipping and working with local contractors to moving money into Mexico from abroad, check out more from MND’s “Mexico and My Money” archive.

MND writer Dawn Stoner is reporting from Guadalajara.