Purchasing a property in Costa Rica is safe and easy. Under CR law a foreigner has the same rights as a citizen, and can own property outright, fully titled, fee simple, just like in the USA or Canada. The majority of the property in Costa Rica is titled.
Unlike North America, our offers are very simple and straight forward. They are more like term sheets than long formal offers. Most of the time, they are 3 or 4 pages long in which you have those followings: the owner’s info, the seller’s info, the property info, the purchase price, the due diligence contingencies, closing date, fees, arbitration clauses, items included or excluded in the sale and at the end the signature of both parties. A faxed or scanned offer is a legal document in Costa Rica, so you don’t have to be here to sign the original. We can send you the offer by email after you get home and you can sign it and send it back once all your questions are satisfied.
Upon acceptance of an offer, an escrow account is set up with a reliable North American Title company such as Stewart Title. A deposit normally around 10% is placed in the escrow account around 7 days after acceptance of the offer as Good Faith. This deposit is normally completely refundable during the due diligence process. The Due Diligence period usually lasts around 21 days giving the attorney time to confirm that everything is clear with the property. They will do a full title search in the National Registry, confirming that the property is free and clear of all mortgages, annotations, liens and encumbrances. They will also make sure that all Municipal, National and Corporate taxes are paid up to the date of the closing and that any Homeowners fees and all utilities and service contracts are also current at time of closing. They will also send you the Estimated Acquisition Costs before closing so you know exactly what the closing costs will be.
During the DD period, we can also order a home inspection if you choose so and any land surveys or engineering work, as well as getting quotes for construction, renovations, repairs, landscaping or furniture / interior decorating. Anytime during the DD period, the buyer has the option to cancel the contract and get their deposit back with No penalty. At the end of the Due Diligence period, assuming there are no issues with the property, the deposit becomes Non refundable and stays in escrow until time of closing, to be applied towards the purchase price.
Most closings in Costa Rica are anywhere from 21 to 30 days after the date of the offer.The third party escrow will make sure that everyone is paid at closing, this ensures and secures everyone involved in the transaction: The seller, the buyer, the agent and the attorney. Generally $1,000 is held back from the seller for a period of 30 days to ensure that any and all utility bills that are the responsibility of the seller are paid.
Upon the successful closing, the attorney will send you copies of all the closing documents, translated into English, as all legal documents in Costa Rica are in Spanish. The buyer and seller do NOT need to be present at the closing. The law firms can be given the ability, using a Special Power of Attorney granted by the buyer or seller, to represent you at closing and close on your behalf. There is a small fee to draw up the Special Power of Attorney but it is usually substantially less than an airline ticket. At last the final official deeds document will be presented to the National Registry to confirm ownership.