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Understand the title deed when buying a property in Costa Rica

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Investing in property in Costa Rica offers diverse opportunities. Choices include tropical villas, rainforest retreats, and urban apartments with great potential for rental income.

However, for international buyers, navigating the complexities of the Costa Rican real estate market can be quite challenging, especially when it comes to verifying the authenticity and legality of the Escritura Pública, which is the official title deed in Costa Rica.

We have actually covered this specific document (among others, like the sales contract) in our property pack for Costa Rica.

In this article, we will give some insight to ensure a smooth and legally compliant property transaction in Costa Rica.

However, please do not forget that this blog post is for informational purposes only and that we are not legal experts. It's always advisable to consult with one. They can indeed thoroughly examine your specific situation and provide you with the most appropriate and tailored advice.

What is the Escritura Pública in Costa Rica?

The "Escritura Pública," or public deed, is a crucial document in real estate transactions in Costa Rica.

It's essentially a formal, legal record confirming the ownership of a property. When you buy property in Costa Rica, the Escritura Pública is what legally transfers the ownership from the seller to you.

This document is unique because it's not just a receipt of sale; it's a legally binding testament to your ownership rights.

One key thing that sets the Escritura Pública apart from other property documents, like a simple sales agreement, is its official status. It's prepared by a public notary, who is a licensed attorney, and then registered in the National Registry (Registro Nacional).

This registration is a crucial step because it's what makes the transfer of ownership public and protects your rights as the new owner.

Now, owning property through an Escritura Pública in Costa Rica gives you pretty much the same rights as it would in many other countries. You have the right to use the property, rent it out, make improvements, or sell it.

However, it's important to know what the Escritura Pública does not do. For instance, it doesn't automatically exempt you from local zoning laws or regulations. So, if you're planning to build or make significant changes, you'll still need to comply with local planning rules.

For foreign investors, the Escritura Pública is a reliable document that offers a significant degree of security. Costa Rica's legal system respects property rights, and having your ownership recorded in the National Registry is a strong legal safeguard.

In terms of resale, owning a property through an Escritura Pública means you can sell it to either locals or other foreigners. The process is straightforward, provided all the legalities are in order.

Inheritance is another important aspect. In Costa Rica, property owned through an Escritura Pública can be included in your will and passed on to your heirs.

This makes estate planning more manageable for foreign investors, as they can be confident that their Costa Rican property will be handled according to their wishes.

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How to verify a title deed in Costa Rica?

The process

Verifying the authenticity of an "Escritura Pública" in Costa Rica is a crucial step in ensuring a secure real estate transaction. This process involves several key players and steps, which are important to understand.

Firstly, the most reliable way to verify an Escritura Pública is through the National Registry (Registro Nacional) of Costa Rica. This government body maintains records of all registered properties in the country.

You can access their services either online or in person. When you check the registry, you're looking for a match between the property details on the Escritura Pública and the registry's records. This includes the property's location, boundaries, size, and the name of the current owner. If the details align, it's a good sign of the document's authenticity.

Involving a notary public is also crucial. In Costa Rica, notaries are legally trained professionals who play a key role in real estate transactions. They are responsible for drafting and authenticating the Escritura Pública.

Therefore, verifying the credentials of the notary who prepared the document is essential. You can do this by checking their name and notarial code against the official list of notaries maintained by the National Directorate of Notaries.

Lawyers are another important resource. A reputable local attorney, familiar with Costa Rican property laws, can help verify the authenticity of an Escritura Pública.

They can conduct due diligence, liaise with the National Registry, and cross-check the notary's credentials. Their expertise can be invaluable in navigating the legal aspects of the property market in Costa Rica.

Real estate agents can assist in this process, but their role is more limited compared to notaries and lawyers.

Agents can provide guidance and may have experience with similar transactions, but they are not qualified to conduct legal verifications. It's best to rely on them for market knowledge and property finding, rather than legal verification.

Remember, taking the time to thoroughly verify the Escritura Pública can save you from potential legal and financial issues down the road.

Always approach real estate transactions with due diligence, especially in a foreign country.

What to check

Understanding a property's history in Costa Rica through its Escritura Pública (title deed) involves several key steps.

This history provides crucial information about past ownerships and transactions, which can influence your rights and responsibilities as a new owner.

To access and trace the property’s history, start with the National Registry (Registro Nacional) of Costa Rica. This registry maintains a detailed record of all registered properties, including past ownerships, transaction dates, and any changes over time.

By examining these records, you can trace the property's ownership history, ensuring there are no irregularities like gaps or disputes in ownership.

Knowing the property's past is important for several reasons. It can reveal patterns or issues, like frequent changes in ownership, which might indicate underlying problems.

Also, understanding past transactions helps verify the legitimacy of the current seller’s ownership.

Checking for outstanding debts or liens is critical. These are legal claims or encumbrances on a property due to unpaid debts, like mortgages, taxes, or construction liens.

To check for these, you should again consult the National Registry. If there are outstanding debts or liens, they can transfer to you as the new owner, making you responsible for their settlement.

The accuracy of property measurements and boundaries in the Escritura Pública is another crucial aspect. Discrepancies can lead to disputes with neighbors or legal issues. To verify this, compare the Escritura Pública's information with the physical measurements of the property. This can be done through a survey by a licensed surveyor.

If there are discrepancies, resolving them might involve legal processes, possibly requiring updates in the National Registry and adjustments in the Escritura Pública.

Finally, understanding zoning laws and land use restrictions is essential. These laws dictate what you can and cannot do with your property.

To find this information, you should consult local municipal authorities. They can provide details on zoning regulations, land use restrictions, and any future development plans that might affect the property.

After our research and the feedback collected from our local real estate partners, we have written an article about the risks and pitfalls when buying a property in Costa Rica, you might want to check it out.

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How to update the title deed after the property transaction in Costa Rica?

After purchasing a property in Costa Rica, updating the Escritura Pública (title deed) is a key step. This process involves several specific actions to ensure your ownership is legally recognized and recorded.

Firstly, the transfer of ownership must be documented in a new Escritura Pública, which is prepared by a Costa Rican notary.

The notary is responsible for drafting this document that includes details of the transaction, such as the purchase price, property description, and the identities of the buyer and seller. It’s essential to have a reputable notary who understands the legal nuances of property transactions in Costa Rica.

Once the new Escritura Pública is drafted, it must be registered with the National Registry (Registro Nacional). The notary typically handles this registration process.

The registration is what officially updates the property record to reflect you as the new owner. It’s important to follow up and confirm that this registration has been completed, as it's the final step in securing your legal ownership.

After the title deed is verified and the property is yours, considering insurance and additional protections is wise. Property insurance, including coverage for natural disasters, is advisable given Costa Rica’s climate and geographical location.

Additionally, liability insurance can protect you from any claims arising from incidents on your property. It’s a good idea to consult with an insurance expert to understand what specific coverage is suitable for your property.

For foreign owners, understanding how the title deed intersects with Costa Rican inheritance laws is crucial. In Costa Rica, inheritance laws might differ from those in your home country.

For instance, there are mandatory share rules that dictate a portion of your estate must go to certain family members. If you’re a foreign owner, it’s wise to create a will that specifies how you want the property to be handled after your passing.

This will should comply with Costa Rican legal standards to ensure it’s enforceable. Consulting with a legal expert in Costa Rican law is key here to navigate any potential complexities.

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This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.