Financing Our St. Croix Real Estate

When H and I got home from our second trip to St. Croix, we were so excited. We had found a couple of vacant lots where we could definitely build a home, and the experience on this second trip had totally convinced us that St. Croix was where we wanted to spend the rest of our lives. Then we got a shock that we had not been anticipating. H began calling banks to find financing to purchase one of the lots. Unfortunately, we are not independently wealthy and do not have the means to buy one of these steeply priced lots outright.

H could not find any stateside banks that wrote land loans for the Virgin Islands. He did find some that would write a combination land/construction loan, but we were not planning on moving immediately so we could not afford to begin building right now.

The rates and terms for the Caribbean land loans were quite daunting. Following is a summary of his research. While these rates were obtained two months ago, I doubt the information has substantially changed or become more affordable for the common man.

First Bank VI – 35% down, 8.5%-9.5% ( I believe 7 yr loan)

Banco Popular – loans up to $125K (8.5%, 10% down, 15 years), over 125K 9.5%, 7 years, 35%-50% down

Scotia Bank – 6.99 5 yr arm, 10 years, 25% down ( I believe 1-1.5 points)

Bank of St. Croix – 25% down, 7 years, 9.75% (adjustable rate)

Virgin Islands Community Bank – 50K max land loan (didn’t get any other info after that fact was stated)

Liberty – Homes only, no land and no construction

Schaffer – Homes and construction, no land

Flagstar Bank – no land or construction

Coastal Financial Co – No land and no construction

Allied Home Mortgage – no land and no construction

Family First Mortgage (STT) – no land loans

We were so depressed after he made these calls. The lots we were looking at were in the neighborhood of $350,000, much more than we had spent on our home in Dallas. With these terms and rates, we would be paying close to $100,000 as a down payment and a $3000 per month payment. That kind of money would be difficult for most people, but especially for me with the student loans that I was paying and will continue to pay for the next ten years. Scotia Bank seemed to be the best option for us, but of course “best” was all relative. Our options now included selling vital organs or winning Mega Millions. We just bought a ticket for this week’s drawing.