What is the procedure to buy a property in Costa Rica? First: After you have found the right property (and have done an initial check under its property identification number), if you are using a Real Estate agent, have them submit an Offer to Purchase (also known as a Letter of Intent “LOI”) to the Seller or the Seller's listing agent in order to agree upon the sales price and basic terms of the deal. Alternatively, if you are working directly with a Seller, it is beneficial to outline in writing the basic terms of the negotiations.  Both the LOI and outline made directly with a Seller should state they are subject to the signing of a formal Sale and Purchase Agreement. Second: Once the Offer is accepted, your chosen Costa Rican legal counsel should be provided with the signed letter of intent or the agreed terms of the negotiation to draft the formal Sale and Purchase Agreement (hereinafter referred to as the “SPA”). The latter document is a legally binding contract, which expressly sets forth all the details and understandings involved in the transaction, as well as the warranties and representations that will survive the transfer of title. As part of the SPA negotiations, the services of an escrow company are usually designated (and recommended) for the purpose of handling the financial aspects of the transaction, such as holding the contract deposit and receiving and disbursing the balance of the purchase price and closing costs at the time of the transfer of title.  Escrow companies are impartial third parties that assume a contractual obligation to both the buyer and the seller to honor the obligations set forth in the SPA and those set forth in the Escrow Agreement. Unlike many other jurisdictions, such as the United States, Costa Rican attorneys are not authorized to serve as escrow agents unless and until they register with the national banking supervisory board, which virtually no attorneys elect to do because the registration and reporting requirements are onerous and time consuming.  Third: Once the SPA has been executed by the parties, the period of Due Diligence investigation begins, for a term that is stipulated in the SPA. As is the case almost everywhere, the purpose of Due Diligence is to provide an interested buyer, at his or her expense, to fully investigate a property prior to making a final commitment to purchase it. In Costa Rica, Due Diligence includes a thorough legal research of all easements and annotations filed under the property's identification number to ascertain whether there are any liens or other conditions of record which would adversely affect the transfer of clear title or a buyer's intended use for the property; the Due Diligence review should also confirm that there is legal access to the property, that the property benefits from public utility services, that the property is current with its obligations to the local municipality, and that there are no zoning or other restrictions that might interfere with a buyer's intended use for the property. In addition, during the Due Diligence period, the accuracy of property surveys is routinely checked (for example, to confirm that the location of structures on the property do not violate zoning or other restrictions, and that there are no encroachments along the boundary lines), home inspections are scheduled to confirm the structural integrity of any improvements on the property and the adequacy of the utilities´ systems, and any other studies which require professional expertise, such as soil tests, can be completed. If the property is being sold by transferring the shares of an existing corporation which holds title, the Due Diligence investigation would include a study of that corporation's legal status to the extent that public records allow.  Fourth: If the Buyer is dissatisfied with the results of the Due Diligence investigation and provides the Seller with formal and timely notification of such dissatisfaction, the transaction will be terminated, and the Buyer will be entitled to a refund of the contract deposit. If the Buyer is satisfied with the Due Diligence review, the transaction will proceed to closing. As previously stated, the title transfer must be completed in the official deed book of a Costa Rican Notary Public. In a cash transaction, the Buyer has the right to choose the closing Notary Public. However, in a transaction that includes seller financing or third-party financing, the Creditor typically has the right to appoint a Notary Public to represent its interests. The Closing documents are then prepared and reviewed by the legal counsel for both the Buyer and the Seller in anticipation of the transfer of title.  At Closing, a conveyance deed is executed by both parties before the designated Notary Public, who is then responsible to record the transfer documents in the National Registry.  At the time of signing, both the Buyer and the Seller, or their legally designated representatives, must personally appear before the closing Notary Public. The signing of the Conveyance Deed is a formal process in Costa Rica and does require for the Buyer to be present at the time of signing in the event title will be taken under a personal name, unless a Power of Attorney has been granted. Contrarily, if the purchase is to be completed by means of a local Costa Rican corporation, agents or signees can be appointed by Powers of Attorney, eliminating the requirement to be present in Costa Rica at the time of executing the Conveyance Deed.   When a property is being acquired by means of a transfer of the shares of a corporation which holds title to the property, in addition to the actual share transfer, the Buyer's Notary Public must make the necessary changes to the corporate charter and replace the Board of Directors and the holders of other corporate positions.  NOTE: There is inherent risk in using this mechanism to acquire property, as purchasing corporate shares means the Buyer is acquiring not only the corporation’s assets but also its liabilities. Some liabilities - such as unsecured promissory notes and other potential claims - may not be matters of public record and, therefore, cannot always be identified through a Due Diligence investigation. However, safety mechanisms can be implemented to mitigate these risks, such as holdbacks and other contractual protections. Fifth: Once the transfer of title is inscribed in the National Registry, some final details must be addressed, such as filing a new declaration of ownership with the local municipality (so the municipality can update its records for real property tax purposes), updating the accounts with public and private utilities services, and obtaining any desired insurance coverage.