Using Home Equity to Buy Property in Mexico: What Are Your Options?

For most of our lives, we're taught the same basic financial plan.

Graduate. Get a job. Buy a house. Make your mortgage payments. Build equity. Hopefully, one day, become mortgage-free.

Great.

You did the work. You made the payments. And somewhere along the way, your property may also have increased in value.

Now you're sitting on equity.

But what can you actually do with it?

And more specifically, can you use that equity to help buy a home in Mexico?

Yes.

First, what exactly is equity?

Let's keep this simple.

If your property is worth $700,000 and you owe $300,000 on the mortgage, the difference between the two is your equity.

That doesn't mean you can necessarily borrow the entire $400,000.

How much equity you may be able to access depends on things like the property, your income and qualification, the lender and the type of financing we're looking at.

That's my part to figure out.

Your part is telling me what you're trying to accomplish.

Your equity doesn't necessarily have to be in Canada

This is actually how my cross-border business grew.

I originally started talking about helping Canadians access equity in their homes to purchase property in Mexico.

Then people started saying:

“Well, I already sold my house. I don't have Canadian equity to use.”

That question eventually led me into Mexico mortgages.

Then something else started happening.

Americans were coming to me for Mexico financing, we'd look at the numbers, and sometimes a mortgage in Mexico wasn't the option that made the most sense for them.

So I'd ask:

How much equity do you have in your U.S. home?

For several of those clients, that changed the conversation completely. I ended up referring four clients back to U.S. mortgage professionals to access their home equity — and those clients are now living in their homes in Mexico.

Which eventually made me think:

Why am I sending these people off to strangers? I need a network.

That search is part of what led me to OIM Mortgage Group.

Today, I can handle Alberta mortgage and equity financing directly, access Indi Mortgage's national network when a Canadian property is outside Alberta, and connect clients with experienced U.S. lending professionals through Orbis USA when the equity is in the United States.

And yes, in some circumstances, equity in an existing Mexico property may also be an option.

So there may be three places to look

If you're considering another purchase in Mexico, the equity available to you might be sitting in:

Canada. The United States. Or Mexico itself.

Which one makes the most sense?

That's where we actually have to do the work.

Accessing equity means borrowing against your property, so we need to look at the cost, qualification requirements, payments, available equity and what you're trying to accomplish.

Sometimes using equity makes sense.

Sometimes a mortgage directly on the Mexico property makes more sense.

Sometimes cash wins.

And sometimes the answer is a combination of more than one strategy.

The house you already own might be part of the answer

You don't need to know how much equity you can access before you call me.

You don't need to know whether it should come from Canada, the U.S. or Mexico.

And you definitely don't need to understand three different lending systems.

That's my headache.

Tell me what you own, roughly what it's worth, what you owe against it and what you're hoping to buy in Mexico.

Then we'll run the numbers and see whether the home you've already built equity in can help you with the one you're dreaming about next.