Costa Rica has little restrictions on the ownership of property but does, however, have a complex legal system that governs the ownership of property and the transfer of titles.
Don’t be scared off by the complexity of it though, because many excellent attorneys specialize in streamlining the process for comparatively modest fees.
Yet even after your lawyer assures you that the title to the property you plan to buy is clean and valid, it’s still wise to take out title insurance.
Mistakes do happen, especially when dealing with government bureaucracy and, of course, after mistakes happen there’s often little you can do unless you have a good title policy. If you do, you can make your claim directly to the insurer who then takes up your case.
When you buy a title-insurance policy for foreign real estate, be sure that it covers these threats to title:
- Ownership issues – what if the property isn’t really yours?
- Liens, mortgages, contracts, options or other encumbrances on the title.
- Fraud and forgery issues, including those that might have resulted from undue influence, duress, incapacity or impersonation.
- Rights of access to and from the land and covenants limiting the use of the land.
- Transfer problems, such as unauthorized conveyances by a corporation, partnership, trust, limited liability company or other legal entity, or one derived through defective judicial proceedings.
- Documentation disputes, such as the invalidity of a document executed under an invalid power-of-attorney, or one improperly executed or recorded, or one with an erroneous or inadequate legal description of the land.
The good news is that title insurance is affordable. It usually only amounts to 0.5% of the purchase price – and often less
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