Last week, I went to Granada to visit friends. Not only were there throngs of tourists, but there appeared to be many new foreigners moving to the Granada area. Fancy hotels and condos sprung up in Granada, practically overnight. New restaurants and bakeries cater to the tastes of foreigners. Relaxing spas and swimming pools bathe and soothe foreign bones and tired muscles.
I wondered how many of the new foreigners moving to Nicaragua were pursuing legal residency in Nicaragua and/or their reasons for not choosing the legal path to residency. Ron and I lived in Nicaragua two years before applying for residency. We got tired of crossing into Costa Rica every 90 days to renew our visas. For us, the process was a bureaucratic nightmare, mainly from the U.S. side; however, for many the process to legal residency is almost impossible.
It is difficult to find reliable and current statistics on the number of foreigners living legally and illegally in Nicaragua. In 2012, when we received our pensionado visas, I peeked at the list of names of foreigners who received cedulas that year, while we were interviewed by the immigration official. I would guess there were about 50 names on the list. I heard, though I am not sure of the reliability of the information, that there are fewer than 500 expatriates who got residency in the last four years.
The number of U.S. retirees receiving Social Security checks in Central America and the Caribbean – one gauge of how many people live outside the US – rose 26 percent between 2005 and 2012, to 28,126, according to the Social Security Administration. It jumped 112 percent in Panama and 32 percent in Costa Rica.
To encourage foreign investments, the Nicaraguan government passed Law 306 that gives a 10-year tax exemption from income and real estate taxes. There are about 6,000 American expatriates and retirees living in Nicaragua, and the number is rising. (2008)
A blog by Darrell Bushnell says, “There are not that many resident expats in Nicaragua. According to my sources there are less than 1300 expat residents in Nicaragua [in 2013] and only 62 new ones last year which means they process a residency application a little more than once a week. This means the majority of expats in Nicaragua are on tourist visas.” Getting Residency in Nicaragua Darrell has detailed information in this article about the types of residency and the process of applying for residency in Nicaragua.
Why do foreigners living in Nicaragua choose to live on tourist visas? We call them perpetual tourists because they have to cross into Costa Rica every 90 days to renew their visas. The reasons are many, and some may surprise you.
1. It may be a frustrating bureaucratic battle to apply for residency. Corrupt and unreliable people exist. Choose an experienced person in Nicaragua who understands the process, has the right connections and good references, and gives you a time frame for the steps to residency.
2. Some foreigners are too young to apply for residency. A pensionado visa requires an applicant to have a lifetime income from a pension or social security.
3. Foreigners that do not qualify for a pensionado visa, can apply for several other types of residency, but they all involve an initial investment of money. Lots of money! Many younger foreigners do not have the money to apply for these types of residency.
4. There are many snow birds who come to Nicaragua and live here during the winter months. It is much easier for them to renew their tourist visas in Nicaragua or by crossing the Costa Rica border, than to apply for residency.
5. Some foreigners do not have clean police records. If this is the case, they cannot apply for residency if they have been convicted of a felony and have a police record.
6. Applying for residency is expensive. It requires diligent planning and gathering required documents before coming to Nicaragua. Since Ron and I applied for residency two years after living here, we had to make several trips back to the U.S. to gather our time sensitive documents. Our estimate for the cost of residency was approximately $2,000 excluding our airfare.
Perpetual tourists are not illegal immigrants. They renew their tourist visas by crossing the Costa Rican border every 90 days or fly out of the country to visit friends and family. Depending on the custom agent at the border crossing, it can be a simple one day turn around process, (for us, in the past) a fun two-day vacation and shopping trip in Liberia, Costa Rica, or a threatening experience if the custom agent has a bad day and warns perpetual tourists to apply for residency or they won’t stamp their passports again.
Nicaragua is cracking down on perpetual tourists. I can understand the reasoning because they have no background information on the foreigners living in Nicaragua and it’s difficult to track the bad guys.
Illegal immigrants are those who live in Nicaragua without the proper documentation, and do not cross the border to renew their visas every 90 days. No one really knows how many of them are living in Nicaragua. Whether out of ignorance, poverty, laziness, fear of bureaucratic hassles, or a desire to stay hidden from the world, illegal immigrants are rarely punished or deported from Nicaragua. As long as they have not committed a crime, if they are caught overstaying their 90 day tourist visa, a fine is issued and they can stay in Nicaragua. It’s called amnesty.
I understand that there are circumstances beyond our control that make it extremely difficult to apply for residency in a foreign country. Yet, my advise to foreigners moving to Nicaragua is to plan ahead, gather documents, explore the process, and talk with other expats who have been through the process…either successfully or unsuccessfully.
Our lives in Nicaragua with residency are so much easier. Take a deep breath and jump into a new world legally. In the long run, through many costly mistakes and bureaucratic nightmares, it was the right decision for us.
Below is an interesting article on American Retirees in Mexico.