Investing in STR outside the US

[Tyrelle Shepherd]

I done STR for 2 years in Colorado Springs and obtained 5 properties. I'm looking to expand outside the US to gain access to international travelers.

1. Bali, Indonesia

2. Punta Cana, DR

I'm currently in the process of buying a 1Bed 1Bath Villa in Bali, Indonesian for $130,000. A few starting questions I have are:

1. Are private/hard money lenders comfortable in investing out of the US if the numbers are right?

2. Would down payment be different AKA more since it's a property not in the US?

3. Would interest rate be higher being that it is a property outside the US?

[Mike Lambert]

I'm copying my reply to your same post in the other thread you created for the benefit of those who'd see this thread only.

I'm not sure what you mean buy you're in the process of buying as you would normally check first if you could get the financing before buying anything.

A few points here:

1. Normally speaking, no lender outside of Indonesia will give you a loan on a property in Indonesia or outside of their home country. This is because they don't have the infrastructure to foreclose should you default on the mortgage. Private money lenders only lend because they have the property as security so they're even less likely to do it.

2. Most likely no Indonesian lender would give you a loan.

3. Therefore, your options are:

a) Pay 100% in cash;

b) Take a HELOC or personal loan in the US;

c) Use love money.

On another note, have you checked the legal aspect of it? Can you own the land as a foreigner? Are you treated equally with local citizens according to the law? I suspect the answer is no to both questions. If that's the case and you get in any sort of legal dispute with a local, good luck to you.

For these reasons, I won't invest in that part of the world whatever the deal. Mind you, if you want to buy a property there for lifestyle and rent it when you don't use it to cover your costs, that's another story. In that case, just make sure you're ok with the legal risks.