property in Costa Rica is very different from making a similar purchase in your
home country. The laws of Costa Rica and its property registration process can
be somewhat confusing to a foreigner. Your best bet is to work with a reputable
Broker when looking for property. When you find a property, your Broker can help
you negotiate the price and then assist you in the necessary due diligence which
follows the Seller's acceptance of your offer.
you decide to buy real estate in Costa Rica, an attorney is absolutely necessary
to do the legal work for purchasing property. We at Arenal Lake Partners work
with only a small, select group of trusted, seasoned real estate attorneys who
will do a thorough search of all records before you make your purchase and make
sure there are no encumbrances (gravámenes) on it. One of the biggest errors
made by foreigners buying real estate is not properly researching the title for
liens. Arenal Lake Partners and our attorneys will do this for you. We are highly
experienced in researching the necessary information contained in the Registro
Nacional of Costa Rica. This is where all legal transactions done in Costa Rica
are recorded. If the property that you decide to purchase is held in a corporation
(known in Costa Rica as a Sociedad Anonima or S.A.), we will also verify who the
legal representatives of this corporation are, since they are the ones who have
the power of attorney to make the sale.
the property appears free and clear of encumbrances, your attorney can then proceed.
At this point, your attorney will draft a transfer deed or "escritura"
to move the ownership from Seller to Buyer. In Costa Rica, the Buyer and the Seller
customarily share the closing costs, which normally run about 4-5% of the total
purchase. A small real estate transfer tax of 1.5% of the actual value is included,
a registration fee, stamps, and notary fees, which vary and depend on the price
of the sale. Title insurance is optional but advisable.Arenal Lake Partners works
with U.S.-based title companies and will assist you during the purchase process
in securing your title insurance.
and registering a property in a corporation has many advantages, the main one
being asset protection in the event of a divorce or a lawsuit, which could result
in you losing the property. When a corporation owns the property, the sale or
purchase of the company can be negotiated, so you don't have to pay property taxes
or stamp fees. All you have to do is change the Board of Directors, the legal
representatives of the corporation and transfer the shares.
At Arenal Lake
Partners, we firmly believe that each Buyer and each Seller should be represented
by separate attorneys. This is not the law in Costa Rica, but it is part of our
Code of Ethics.
you can't live on your property year-round, then you will want to hire a guard,
caretaker or a reliable housesitter to watch it for you. Arenal Lake Partners
works with a reputable Property Management firm here at Lake Arenal called LAPM.
LAPM is owned and managed by a couple from the United States who always "go
the extra mile" for our clients. Arenal Lake Partners does not take a fee
from LAPM nor from our clients who use LAPM. We are simply referring our clients
to be sure that they receive the best care possible when they are not at their
property in Costa Rica..