When you buy property in Costa Rica look for an independent law firm
When a Costa Rican wants to purchase real estate, the first thing that he’s going to do is to look for the real estate attorney of his trust. That’s the basic scenario for real estate transactions in Costa Rica; however, that’s not what normally happens when the buyer is foreign.
Following practices proper of the North American legal and business culture its typical for foreign investors to visit real estate broker agencies when searching for their dream second home. What would happen is that the broker will refer such clients to a local lawyer or a law firm of their preference. You will see that phenomenon takes place in areas such as Jaco, Dominical, Tamarindo, Montezuma, Flamingo, Liberia, and generally, in most of the tourist destinations. We like to believe that there is no bad faith involved in the relationship between the broker and the referred local lawyer; however, it is difficult not to foresee a possible “conflict of interest” arise in such transactions.
As it’s well known in order to purchase Costa Rican real estate, it is necessary for an experienced real estate attorney/notary to conduct a serious Title Search and a thorough Due Diligence process to verify all the details required to transfer the property to the new owner. So if you are the local lawyer of a law firm being referred by the local broker to close on that property, it is almost human to be less strict on vital legalities and formalities for the purchase to be properly recorded protecting the interest of your clients.
In good legal theory and as it is taught in Law School, Notaries are supposed to be impartial in their public function; nonetheless, reality puts that noble promise in a junction. Desperate real estate brokers are known to be pushy with their referred lawyers as they don’t want any small details to interfere with them getting the highest possible commission.
Why hiring an independent law firm?
When you hire a specialized independent law firm or lawyer you are taking the first steps into protecting your interests, your lawyer should be in charge of the entire process including drafting the transfer public deed and recording the purchase at the National Registry. The benefits are obvious, your lawyer will make sure that you are getting what you are paying for and he or she might even work with you in finding related professionals such as surveyors and appraisers which can be instrumental in verifying the conditions of the property of your interest and in many cases obtaining better prices from the Seller, something that very rarely would happen with a local referred attorney.
Do like the locals and look for a specialized independent real estate law firm or attorney, this will significantly increase the protection of your assets.
If you have additional questions on this topic, feel free to directly contact our managing partner at GLC Abogados Augusto R. Arce via his email address: augusto@glcabogados.com or by calling at +506 2524-3176. Schedule an Appointment