Thanks to a system based on British Common Law, Belizean law places almost no restrictions on foreign ownership of real estate. As a result, buying property in Belize is far easier than it is in many other countries.
Insurance Is Critical
After your lawyer has assured you that the title to the property you plan to buy is unencumbered, it’s still wise to invest in title insurance. In the U.S., buyers of property have come to rely on title insurance to guarantee that they actually own the property they purchase. Today this type of title insurance policy is available in nearly every market in the world. Even retaining the best attorney doesn’t eliminate the need for protection that insurance provides.
It is important to work with the title company and the attorney from the beginning of the purchasing process. For protection against boundary disputes and encroachments and other unregistered interests for instance, the title company would need the attorney to work with the seller and get affidavits on these issues. If the title company becomes involved too late in the process, it is harder to obtain information from the seller. For the same reason, it’s smart to spend money on a survey of the land. If this is done before the sale, you will know immediately about any problems with neighbors. If there are problems, you’ll be in a much stronger position to get the seller to resolve the issues before the sale is consummated.
Title insurance is designed to protect against a loss when the title to property is other than as insured. Specifically, your policy needs to insure against losses caused by title defects, liens, and encumbrances. In the event that your title is disputed, for example, you’ll want the title insurance company to provide a legal defense for you. In the event that you lose the case, you’ll then want the insurer to compensate you up to the amount of the policy. As a policyholder, the idea is that you get this protection and security for a one-time premium. The legal-defense portion of the coverage can be critical. If you’re sued over a title matter in a foreign country where you don’t speak the language or understand the laws, you can be at a great disadvantage. A sound title insurance policy, however, gives you a representative who will stand by you in response to the challenges to your title and defend your property rights in the country where your property is located. When you buy a title insurance policy for foreign real estate, be sure that, at the very least, it covers these threats to title:
- Ownership issues—what if the property isn’t really yours to own?
- 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.
There are three classifications of land in Belize: forest land, national land, and privately owned property. As you would expect, the land in forest reserves is not available for lease or sale except for certain forestry purposes, and then only with a special license. National lands are usually first leased to an individual proposing to develop them. The government can sell the lands to the tenant once he or she meets all the provisions of improvement outlined in the lease. National lands can be sold to non-nationals under these conditions:
- The development program must contribute significantly to the economy
- There must not be suitable private lands available for the same project
- The lands must be confined to under-developed regions of the country and
help to encourage development there