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Buying Caribbean Real Estate in the Cayman Islands

Mortgages
Financing can often make the difference in getting the Caribbean home of your dreams, or not. That’s why it’s important to talk to a mortgage loan professional before you start real estate hunting. If you do not have a mortgage broker you can call upon, we will provide you with the names of some highly-respected local brokers. They will take the time to explain the options available to you and recommend a loan program designed to meet both your short-term and long-term objectives.

Interest rates for Cayman Islands real estate are based on prime plus one or two points over the prevailing prime rate. Standard mortgage terms require a  5-35% down payment plus closing costs, at a rate of 1 or 2 percentages above the prime rate. Mortgages are normally amortized over 10 to 15 years with some lenders recently offering up to 30 and 40-year terms to Caymanians. Most financial institutions do not charge pre-payment penalties. The property you are purchasing will be your collateral, but your personal balance sheet must indicate that you can afford to make the repayments.

Non-residents may open bank accounts and obtain a mortgage to purchase Cayman Islands real estate. And, bank accounts may be in the name of the client or in a Corporation. It is illegal under Cayman Islands Law for any institution or individual to divulge any financial information unless it can be proven that the funds were obtained through illegal means such as drugs, fraud or theft.

Interest on money borrowed in the Cayman Islands is tax deductible in most countries.

A stamp duty of 1% of the sum less than CI$300,000 (above CI$300,000 is 1.5%) secured by the mortgage must be paid to the Cayman Islands Government. In nearly all cases the duty is paid by the borrower, particularly, in cases involving a lending institution.

Investing in Cayman Islands Real Estate

With no direct taxation the Cayman Islands is a thriving offshore financial center and residents have, for many years, enjoyed a prospering economy. Growth in population and tourism fuels the success of investments making investing in Cayman Islands real estate a profitable venture. One significant factor in deciding to invest and/or reside in the Cayman Islands is that there is no direct taxation whatsoever. Reputable legal and accounting professionals are readily available to advise you on your offshore investments.

One key advantage of doing international business in Cayman is that the intellectual resources in all ventures relating to global finance are readily available from experienced practitioners. In fact, few other international financial centers come close to matching the Cayman Island's professional resources.

British Dependency status assures investors of the Cayman Islands stability and, Cayman is signatory to international treaties and conventions and attracts the world's most respected firms and investors.

The Cayman Islands real estate market is uniquely attractive to those looking for an overseas holiday get-away, or a retirement residence. For foreign investors, it can offer a solid capital return on their investment, as well as the chance to own a secluded piece of "paradise" with the Caribbean real estate market. There are a wide variety of investment opportunities in the Cayman Islands from residential to commercial properties ranging from a small, secluded Caymanian cottage in the sparsely populated East End to a lavish oceanfront condominium on world famous Seven Mile Beach.

There are no restrictions on foreign ownership of Cayman Islands real estate, and a modern land registration system is run by the Government's Department of Lands and Survey. A stamp duty, or transfer fee, ranging from 6-7.5% is payable on transfers of land and mortgage deeds, and is a one-time fee. The Cayman Islands has a modern, secure infrastructure and a stringent building code.

The innovation is apparent in legislation, technological and telecommunications, and in the development of new instruments for investors.

To review, the benefits of Investing in Cayman Islands real estate are:

• No direct taxes imposed by the Cayman Islands government: no property tax, no capital gains tax, no inheritance taxes, no income tax, no non-resident tax and no sales tax

• No restrictions on foreign ownership of Cayman Islands real estate

• Ownership can be held in one or more names of individuals or in a corporation, which does not reveal actual ownership

• Stability and Security - the Cayman Islands has a stable government, sophisticated infrastructure and a strong economy based on international banking and tourism

• Caymanians enjoy one of the highest outputs per capita and one of the highest standards of living in the world