Bahamas Mortgages

If you want to buy real estate in the Bahamas, you will generally fall into one of two categories:

• You need a high-value Bahamas mortgage, but you don't have complex needs in terms of structuring – the deal is relatively straightforward, and your priority is to borrow as much as possible at the best rates
• You want to make a high-value property purchase and want competitive rates and terms, but you also need structured property finance, as directed by your professional advisers. This may be because you have what lenders will consider a "complex" background. For example, you may wish to own property through a structure or use existing or new entities to hold your Bahamian property. Many American investors, in particular, find they fall into the latter category. 

Whatever your requirements, Enness will be able to broker a competitive and tailored deal for your Bahamas mortgage, working with you directly or liaising with your team of advisers as required.  

Depending on your requirements, Enness' first port of call for Bahamas mortgages is international private banks and sometimes specialist or "niche" lenders. Private banks tend to be best suited to meet your requirements, however, especially if you are an ultra- or high-net-worth individual.

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Many investors buying Bahamian real estate are high-net-worth individuals or families, and Enness can usually negotiate highly competitive rates from private banks for these individuals. That said, getting property finance from a private bank (particularly if you want a high-value mortgage) will usually require that you place assets under management in return for being able to access these rates. These lenders usually prefer to lend to liquid individuals with high-value assets and investments to support the mortgage and loan amount: an interest reserve account equal to one year's interest on your Bahamas mortgage is relatively standard. Provided you can put forward assets under management, you will find that Enness can then negotiate very effectively on your behalf.

The Bahamas is well-known for its taxation regime, which is attractive for anyone considering buying property and residing in the jurisdiction. Residents are not liable to pay inheritance, income or wealth tax. The corporate tax rate in The Bahamas is also nil, meaning it is a desirable location for domiciling corporate entities. However, the Bahamas is not "tax-free", and if you are buying real estate, there is a property tax levied on residential property. You will need to look carefully at what you are liable to pay in this regard and how purchasing property or residing in The Bahamas will affect your overall fiscal situation with your advisers. 

There are also commercial opportunities for property investors, given you can rent out your Bahamian real estate to generate income. If you wish to pursue doing so, you will need to apply for a rental licence from the local authorities.

The annual tax charge on your property is based on the value of your Bahamian real estate, whether or not you rent it out. Rates are subject to change and should be verified carefully with your advisers, but as a guide, rates sit as follows:

• Property valued at less than $250,000: 0%
• Property valued at $250,000 up to $500,000: 0.75%
• Property valued at $500,000+ : 1% on the total value that exceeds $500,000, with a rate of 0.75% being due on the value of the property that sits between $250,000 and $500,000 

Many buyers hold their Bahamian property through corporate structures. On the one hand, this can facilitate estate planning, and on the other, it may help mitigate what you will pay in taxes. If your advisers suggest you buy your property through a company structure for fiscal, privacy, estate planning or liability purposes, Enness will be able to source and negotiate a Bahamas mortgage to support this. 

As an independent broker, Enness has access to all the private banks, niche and specialist lenders who offer Bahamas mortgages. Your broker will assess your background, assets and requirements for property finance and will then approach the lenders that will be able to provide you with the best rates and terms. 

Even if you are a high-net-worth individual, you may find that some lenders struggle to consider your global assets and income to support high-value borrowing and lower the cost of your mortgage. Enness will be able to present your case to the lenders who can consider all the merits of your case and meet your needs regarding structuring. Your broker will also ensure you maximise the amount you can borrow for a Bahamas mortgage while minimising your long-term financial liabilities as much as possible.