Santa Anna Volcano, El Salvador
by Enrique (Henry) Saldana (January 2012)
First there were 7, and then there was 1 (ONE).
Yes, back in 2007 we had up to 7 lenders courting American and Canadian Mexico home buyers to purchase their home with a mortgage, and many did. However, little by little, some of they disappeared from the market, leaving us with two, after GE Money also bailed out of the USD mortgage Mexico market.
And then it was a battle for the biggest piece of the market between Compass Bank/BBVA Bancomer and Scotiabank Mexico, backed by Scotiabank Canada—a battle, according to many, that was being won by Compass Bank/BBVA Bancomer. Compass Bank is a USA subsidiary of BBVA Bancomer in the USA. A small bank based out of Laredo, Texas, it expanded throughout the state of Texas but concentrated mostly on local lending and banking initiatives. But through the support of BBVA Bancomer it saw an opportunity to take over the Mexico USD mortgage market.
And they did, at least for a while, up to the end of 2011. Why? Because all of the sudden, and without notice, Compass Bank closed their USD Mexico Binational Mortgage Program, as of January 6, 2012. And although I might be wrong on the exact date, it has been about a week since the closing of this program took place. This is coming from very reliable sources inside Bancomer and Scotiabank.
So in trying to understand why this has happened, since there is no press release or any information release as to the reason for the closing of the Binational Program, I would like to think the following:
Since Compass Bank is a USA Bank and, considering the uncertainty of the economy in the USA at the present time, it makes sense that they would close a program based on the Secondary Market Mortgage and backed security issues. Compass Bank would reconsider the continuance of the same. Furthermore, the fact that BBVA Bancomer is a Spanish Bank (from Spain), one of the European countries that along with Italy and Greece, to name a couple, that are presently having serious economic problems, it is also understandable that BBVA Bancomer would be looking with a fine-toothed comb at the Binational Mortgage program.
On the other hand, Scotiabank Mexico, which is a subsidiary of Scotiabank Canada, does not necessarily share the same concepts and information as they are a totally independent bank out of Mexico, and being that the Canadian Economy has remained one of the most stable in the world, it is naturally understood that they would continue with their Home Vacation USD Mortgage Program.
Whether or not Scotiabank Mexico takes advantage of the present situation, being the only bank providing USD Mortgages to Americans and Canadians purchasing property in Mexico, and takes over the market remains to be seen. Let’s also not forget that BBVA Bancomer might also come back with a Peso Loan for foreign mortgage market purchasers. Time will tell.
In the meantime, and as of the publication of this newsletter, Scotiabank is your only option for acquiring a USD Mortgage to purchase a property in Mexico, whether you are an American or Canadian citizen or legal resident of those countries. So take advantage of that opportunity now!!!
For further information, feel free to contact us:
Enrique (Henry) Saldana
Mexico Realty Solutions www.mexicorealtysolutions.com
moneylendingbus@hotmail.com
Tel: (984) 147-2388; Cel: (984) 111-8743
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