Mortgages in the Cayman Islands can be obtained from a local Class A bank as these are the banks which are authorised to lend money. It’s sensible to shop around, however, as rates are competitive and the percentage above prime (from 1%-5%) can be negotiated. The usual term for a mortgage is 20 years, although some banks will offer as much as 35 years.
Most home-buyers will be asked to make a down payment of 5-10% or more as a deposit. There is no such thing as an interest-only mortgage in Cayman as there is in other parts of the world. Definitely ask if you can pay bi-weekly (thereby paying less interest) and check if the bank charges a penalty for early repayment. Various factors including profession, salary, employer and credit history are taken into account when determining terms and also whether the applicant is Caymanian or an expat.
Once newer residents have established a good financial track record here however, the banks may be willing to renegotiate terms and give a more competitive rate. When taking out a mortgage, it is also worth factoring in that you will be charged stamp duty on the money you borrow. Mortgages of less than CI$300,000 attract a 1% government stamp duty fee, while for mortgages of CI$300,000 or higher, attract a figure of 1.5%. If you are using an attorney, they typically charge 0.5%, while the bank charges 0.5% on the cost of the mortgage.
If you think you will be here for a few years, buying can be a good investment, and you may pay less on your mortgage than if you rented the same property. However, always consider that when buying a property, the stamp duty is 7.5% and when selling the property, real estate agents charge between 5%-7.5%.