This holds true
for both Costa Ricans and foreign investors, who benefit from similar property
rights and privileges of the locals. The state, however, imposes a firm decree
on the details of land ownership prior to the purchase of foreigners who are
not permanent real estate of Costa Rica.
- Land
Ownership:
Costa Rican laws and the constitution guarantees private ownership of land. By
law, foreigners have the same property rights as citizens. For foreigners,
there are almost no restrictions to ownership of private land. However, there
are government programs that sell or give land to Costa Rican citizens. After a
time period, these lands can be freely traded or acquired by foreigners. You do
not need to be a citizenship, residence, or live in the country to own property.
- Clear
Title Registration and Information:
Costa Rican law requires that all property documents with clear title must be
registered in the property section of the Public Registry (Article 460 of the
Civil Code). All property must contain a titled registration number, the Folio
Real. The national database can be searched with this number or by name index.
This report, the informe registral, will provide all detailed information about the property. The information including the name of the titleholder, all boundary lines, tax appraisal, any liens, unpaid mortgages, recorded easements, and all other recorded instruments that would affect clear title for the property. To protect the buyer, Costa Rica follows the doctrine of first in time, first in right, all recorded instruments regarding land for sale presented to the Public Registry are given priority according to the date and time in which they are recorded. For the buyer, this means that any mortgages or liens, which are not recorded by the national registry at title transfer, are not valid. Since the certificate of title issued by the Public Registry is conclusive evidence for clear title on the date issued, any lean or instrument not recorded at the time the certificate is issued is invalid by Costa Rican Real Estate law. This means that there is no need for title insurance, because any instrument not in the report is deemed invalid.
- Registration Procedure for
Title Transfers:
One of the responsibilities of the
legal counsel is to make sure that the property title is taken care of after
settling all the bills. It is the obligation of the specific notary public who
made the transfer to present and register the deed with the Public Registry’s
Property Department. As the selling or buying party, it is imperative for you
to ask for updates on your property’s title transfer. The office of the Public
Registry does not recognize deed transfers with unsettled or pending
registration and tax bills. Among the other needed documents is a certified
copy to be obtained from the Finance Ministry office after providing
certifications of the seller’s current payments on property taxes.
Supporting documents can be easily
acquired from the local municipal office, where both parties are required to
settle municipal tax requirements. As soon as the transfer is acknowledged for
registration, the registry office will give back all original papers, complete
with documentary stamps. Transfer papers must be registered with the office
forty five to sixty days within its presentation.
- Property Closing Expenses for
Land Title Transfers:
The sale of land includes spending
on legal fees, such as transfer charges and stamp tax, to name a few. This
aspect of the sale covers about three to six percent of the total cost of sale.
Charges involved in the transfer are paid for by the buyer. The amount of
transfer tax is based on the declared worth of the property as assessed by the
realtor. Legal fees charged on the sales cost of the property also depends if
the property in Costa Rica is held by a local corporation, or a multi-national group of
investors.
