Compare fixed and adjustable mortgages in Costa Rica. Discover why most U.S. borrowers prefer the predictability of fixed-rate loans when buying a home.
Thinking about financing a home in Costa Rica? A fixed-rate mortgage provides long-term stability, while complex adjustable-rate loans shift with the market.
When you’re buying a home, clarity and long-term stability matter. That’s why an overwhelming majority of Americans—more than 92% of borrowers—choose a fixed-rate mortgage.
At Second Street, we’ve made that option available to Americans purchasing or refinancing property in Costa Rica. We offer 30-year, fixed-rate mortgages that mirror what you’d find in the U.S.—with predictable payments, the lowest rates, and no prepayment penalties.
Some lenders may promote “teaser” rates through adjustable-rate mortgages (also called ARMs). But those come with hidden risks, added complexity, and potentially much higher long-term costs. Here’s the kicker: Second Street’s fixed-rate is usually lower than their ARM’s “teaser” rates—even at the start.
With a fixed-rate mortgage, your interest rate and monthly mortgage payment never change—they remain the same for the full 30-year term.
Why it matters for buyers in Costa Rica:
Adjustable-rate mortgages start with a temporary fixed rate—usually for 5 or 7 years—before adjusting periodically based on a market index, like the SOFR or Costa Rica’s TRI, plus a margin. These rates can rise significantly over time and often come with minimum floor rates that limit how low your rate can go—leading to regret.
SOFR, or the Secure Overnight Financing Rate, is a benchmark interest rate that reflects how much financial institutions charge each other to borrow short-term, backed by U.S. Treasury bonds. This rate plus a margin is commonly used in ARM calculations.
The TRI, or Tasa de Referencia Interbancaria, is Costa Rica’s Interbank Reference Rate. It shows the average interest rate banks pay on term deposits, in both colones and U.S. dollars, across different time periods from one week to five years. Local banks usually use this rate and add a margin of around 4.5-5%.
Even if an ARM rate did look better at first glance, it usually doesn’t stay that way—and in today’s market, our 30-year fixed rate is often lower than what any other lender can offer, even on their adjustable-rate mortgages.
When buying in Costa Rica, you want to make sure you have financing that’s stable, secure, and familiar. With a 30-year fixed-rate mortgage from Second Street, you get locked-in monthly payments with the most competitive rates—giving you true peace of mind for decades.
There’s a reason fixed-rate mortgages are the gold standard—and why we’ve brought them to Costa Rica.
Get started with Second Street today and take the first step towards your dream home in Costa Rica with a U.S.-style mortgage—without the risk. Your dream home is closer than you think.
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