The season-long arrangement was threatened over some paperwork issues at the Spanish end but that has now been cleared up a week after the transfer window closed.
The player’s agent Lyle Yorks said: "Carlos has gained clearance for the loan move to Racing Santander. He will be available for selection when he returns."
Bocanegra is currently on duty with the US national team who were shocked in Jamaica last night when they lost their opening World Cup qualifier.
The Rangers defender was on the bench in Kingston as Clint Dempsey gave the Americans the lead but they lost two late goals.
However, Jurgen Klinsmann’s side has the chance of revenge when the two sides meet again in Ohio on Tuesday night.
Klinsmann explained that Bocanegra, the regular captain, did not play because of the uncertainty hanging over him.
Meanwhile Dorin Goian was on the winning side as Romania won 2-0 in Estonia to get their World Cup campaign off to a positive start.
Bocanegra’s central defensive partner is on loan to Serie B side Spezia and like the American will be back at Rangers next summer.