Foreign Ownership Issues in Ecuador
For matters of real estate, foreigners and Ecuadorian natives are almost on an equal footing. There are restrictions on ownership of property that lies within 50 kilometers of the coast or an international border. Foreigners must request permission (which is routinely granted) to buy or live on such properties. Certain lands are marked as areas of national security by the government, and therefore cannot be purchased.
When looking to purchase a home in Ecuador, one particular danger area is the purchase of derechos y acciones, or rights and shares to a property, instead of cuerpo cierto, which is an outright sale. Derechos y acciones are the rights granted to heirs when a property owner dies without a will. This is quite common in Ecuador, and makes for an extremely risky purchase. Unless you can verify that all heirs are accounted for prior to the sale (and then complete the sale cuerpo cierto), you should avoid this type of purchase, because you may subsequently be open to claims from people who believe themselves heirs.
If you purchase property in Ecuador, we strongly recommend engaging the services of a real estate attorney who has worked with other foreign buyers. A title search can save you considerable grief down the road. Although many Ecuadorian real estate agents will tell you that this is not necessary, don’t believe them. To guarantee ownership of your property, we strongly recommend that you take out a title insurance policy.
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