Locate a Reliable Attorney
Research the Property Information
Write a Transfer Deed
Closing Costs
Taxes
Mortgage Registration Fees
Register The Transfer Deed
Tips before building in costa rica
Table of Measurements

Locate a Reliable Attorney
Ask someone you trust to recommend someone you trust. Your country's embassy or one of your consulates might have some suggestions to offer. The Costa Rican-American Chamber of Commerce is worth a call.

Research the Property Information
Request your attorney to conduct a title search at the Registro Publico (Public Registry) about the property you want to buy.

By law all properties must be registered in Registro Publico. Most properties have a title registration number called the "Folio Real." Once you have this number you can search the database. The Registro Publico's Report, called the "Informe Registral," contains information such as the name of the title holder, boundary lines, tax appraisal, liens, mortgages, recorded easements, and other records that could affect the title.

Costa Rica follows "first in time, first in right" rule. Additions to a property title are prioritized according to the date they were recorded. So make sure your attorney searches your title back to the beginning. You're laying out a lot of hard earned money for this house, God forbid you should wake one morning to find some smiling fool standing on your porch, waving a long-lost mortgage-from-hell under your chin, announcing that you have until four o'clock to pack your traps and be on the train back to Anaheim.

Custom dictates that if the buyer pays in cash, he selects the attorney to draft the transfer deed. If the purchase is financed, then the transfer can be made in various other ways.

A. If a large percentage of the purchase price is financed by the seller and a mortgage needs to be drafted to guarantee payment, the seller's attorney may draft the transfer deed upon seller's request.

B. If a property is purchased 50% cash and 50% financed, the buyer's attorney and seller's attorneys can draft the transfer deed and mortgage in a single document. This process is called a co-notariado.

C. Buyer may have his attorney write the transfer deed and let the seller's attorney draft a separate mortgage instrument. Since the mortgage agreement is being drafted separately, registration fees are higher.

Closing Costs
By custom, buyer and seller split the closing costs, but the split may be adjusted up or down to fit the occasion.

In any case, you just paid out a bundle of money for your new home. You signed the papers. The place is yours. But don't put away your wallet just yet. Open the door and peek down the hall. You'll find a line of people out there, each with a grin on his face, each holding up a palm the size of a tennis racket.

You must buy Documentary Stamps - Agrarian, Hospital, Municipal, Bar Association, National Archive and Fiscal - totaling 0.55% of sale price. You must pay a Real Estate Transfer Tax at 3% of the sale price and a Registration Fee of 0.5 % of sale price

Plus

Notary Fees

1.5 % of the first $5,000 (million colones) and 1.25 % of the balance

Mortgage Registration Fees
Usually, the person getting the financing pays for the costs of drafting and registering the mortgage instrument. A mortgage may be issued at the time of the sale by adding a mortgage clause to the transfer deed. A mortgage within a deed costs 0.25% in registration fees and approximately 0.53% in documentary stamps. For drafting the document, the notary receives between 0.5% and 1.25% of the amount of the mortgage.

Register The Transfer Deed

To register your transfer deed you or your attorney must bring to the Registro Publico (Public Registry) the following documents:

A. Proof of payment of all taxes and registrations fees

B. Certifications issued by: a) Finance Ministry, confirming that all seller's property taxes were paid; and, b) the local Municipality, stating that buyer and seller areup to date on municipal taxes.

C. Proof that all prior mortgages, liens and judgments (if any) have been resolved

Once all fees are paid, make sure that the attorney who drafted the transfer deed registered it in the Property Section of Registro Publico. It should be registered by the Registro Publico 45 to 60 business day after presentation. Check with the notary to make sure the deed has been properly filed.

Hint: Before you buy the house check conditions of the house during dry and rainy season; talk to the neighbors and ask them if they know of any problems in the house.

Here are a few tips before building in costa rica:

Good contractors do exist. Check around. Look for an experienced construction firm that can assist you with permits as well as building. Interview several companies; ask lots of questions.

Make sure that the attorney has done the proper title research confirming that the property is suitable for construction.

Spend as much time as you can on the site; get involved in the building process. This is as near as you'll get to guarantee that your house doesn't break the bonds of its blue print and become a huge, money eating monster, devouring your bank account, your credit rating and what remains of your sanity.

Hint: To keep control: dole out the cash to the contractor. Give him what he needs to buy materials. Pay him a bit at a time as the job progresses so the workers will be inspired to do quality work and to finish on time.

1. Get a bilingual Costa Rican friend to talk to sellers about property and prices. Foreign accents raise prices.

2. Do not be satisfied with the Registro Nacional Records. Explore the property yourself. Check out real estate price in the area. Talk to the people at the local pulperia or grocery store.

3. Negotiate in colones

4. If you rehire people who worked for the previous owner, make sure he paid them properly. You, as a new owner, could be liable for sins of the past.

5. Hang onto your telephone lines. They're hard to come by.

6. Keep in mind that your real estate investment may be affected by inflation, devaluation of colon and by the exchange rate of your currency.

7. If you are a landlord, you can evict tenants only if you can prove that you need the property for personal use. You cannot evict tenants as long as they pay their rent on time. By law rent can be increased only by 15% annually unless stated otherwise in the lease.

Table of Measurements

1 mile = 1.61 kilometer
1 km. = 0.62 mi.
1 sq. mi. = 2.59 sq. km.
1 meter = 3.28 feet
1 foot = 0.3048 m.
1 m. = 1.09 yards
1 sq. m. = 10.76 sq. ft.
1 sq. ft. = 0.09 sq. m.
1 manzana = 0.70 hectares
1 manzana = 7,000 sq. m.
1 manzana = 1.73 acres
1 a. = 43,560 sq. ft.
1 a. = 0.40 h.
1 h. = 10,000 sq. m.
1 h. = 2.47 a.
1 h. = 107,600 sq. ft.
1 in. = 2.54 centimeters
1 millimeter = 0.039 in.
1 cm. = 0.393 in.