Prepared by Roger A. Petersen, Attorney at Law San Jose, Costa Rica
At our law firm we want to ensure that your property closing process goes as smooth as possible. With that in mind we have prepared the following Property Closing Checklist which you can follow during your property purchase process.
1. Perform Property Title Search.
Once you have identified a property that you are interested in purchasing request the Seller to provide you with the property title number called Matricula de Folio Real. With that information a Property Title Search can be initiated to ensure the property is free from liens and encumbrances.
2. Review Property Survey Map
Every titled piece of property must have a corresponding property Survey Map (Plano Catastrado). Request a copy of the survey map to ensure the information matches the one in the title search.
3. Obtain Zoning Criteria
If you are purchasing raw land with the intent of building upon it then it is advisable that you request a Zoning Letter (Uso de Suelo) from the Municipal Government where the property is located to ensure that what you want to do on the property will be allowed.
4. Insure Availability of Utilities
a. Electrical Connection b. Water Connection c. Telephone Connection d. Cable TV
Verify the availability of utilities when applicable. When purchasing a home request that the seller provide at closing the last two month of paid receipts for Electricity, Water, Telephone and Cable TV to ensure there are no outstanding bills.
5. Do a Walk Through of the Property
It is important to do a walk through of the property you intend to purchase. In the case of raw land it is important to verify all property boundary points. If in doubt retain your own surveyor to verify the existing survey map. In the case of homes which are already built be sure that all fixtures are in proper working condition and if in doubt retain a home inspector.
6. Submit Offer for the Property
The manner in which the offer is submitted varies and depends on the circumstances. Many realtors have their own forms and they vary accordingly. To properly formalize the offer it is recommended that a Purchase Agreement which complies with Costa Rican law be used.
7. Draft a Purchase Agreement for the Property
The Purchase Agreement known locally as a Promesa Reciproca de CompraVenta is the legally binding document which sets out as a minimum all of the following:
a. Identification of the Parties to the Transaction b. Legal Description of the Property c. Terms and Conditions of the Sale d. Payment and Escrow Provisions where applicable e. Establishes the Closing Date f. Outlines default provisions g. Establishes due diligence period when applicable h. Outlines disbursements and closing costs
8. Initiate your Due Diligence
Once the Purchase Agreement is signed start your due diligence procedures to satisfy any pre-conditions which were established in the contract.
a. If applicable in depth Title Search at the National Registry b. If applicable re-survey of property for comparison of boundary points. c. If applicable Home Inspection of the Property
9. Prior to the Actual Property Closing
Either a day or two before closing or at the actual closing request the Seller to provide the following for your inspection:
a. Proof of Payment of Property Taxes b. Proof of Payment of Municipal Services c. Proof that all Utilities are paid d. If it is a Condominium property proof that Condo Fees are up to date e. Do a walk through of the Property prior to closing.
10. At Closing
a. Sign the Property Transfer Deed Drafted by Notary Public b. Exchange Payment as per Purchase Agreement c. Receive Keys and garage controls when applicable.
11. Post Closing
a. Notary records the Property Transfer Deed b. Recorded Deed is delivered to Buyer c. Buyer Informs Municipal Government of Property Transfer To Update Municipal Property Tax Records
Copyright 2012 By Roger A. Petersen No Copying or Reproduction Allowed without written authorization from the copyright holder