To review, my name is Rudy Matthews. I am
a personal advisor/consultant concerning real estate transactions
here in Costa Rica. My goal as a consultant is to protect
you, save you money and eliminate frustration.
Having said that, should you buy? Absolutely!
If you have a serious interest or have definitely already
decided to invest
in Costa Rica real estate, go ahead and
do it. Costa Rica is a remarkably beautiful country. The beaches
and mountains would be hard to duplicate anywhere in the world.
You may have heard of a "horror story" about Costa
Rica real estate and people that have been taken advantage
of. There is no need to dwell on the negative but instead
be that educated, well informed person that makes the intelligent
decisions before and during your transaction.
Deposits and escrows
In Costa
Rica real estate transaction is different. I have
read with interest the internet articles concerning "crooked"
real estate transactions and much is said about comparisons
in the U.S. To compare is negative energy because you are
in an apples and oranges situation. The first step in protecting
yourself here in a real estate or any transaction is to
realize you are in a different country governed by a different
legal system and you fall under the umbrella of the way
things are done here - not in the U.S. For instance, real
estate depoists and escrows here are very differnt. Escrow
accounts are pretty much non-existent unless you are dealing
with Stewart Title or have a legal private arrangement with
your realtor or lawyer. Deposits will be the focus since
you definitely need to be aware of the deposit structure
in Costa Rica with individual sellers. The majority of the
time the deposit is going to be held by the seller. Instead
of "held", I should
have used the word "given" to the seller. I do
not think many sellers in Costa Rica hold deposits very
long. Therefore, you should place as little money as possible
in the hands of the seller. 5% is a start with a maximum
of 10%. I will share with you my standard phrase over the
years when buying real estate from individuals. When asked
how much money I would like to deposit, I would state "The
least amount of money possible". Then when the seller
named a figure I always said it was too much and again "What
is the least amount possible". It is amazing how sellers
will come down to initiate a sell.
If you back out as a buyer, the seller who already has your
deposit will most likely keep it. I would venture to say
in Costa Rica under normal circumstances the seller has already
spent the deposit money. You can put protection clauses in
your contract but the bottom line is deposits once lost are
hard to recover here in Costa Rica. The one clause I advise
clients to put in the contract is that if the seller does
not honor the contract or other circumstances occur, the
buyer will be given back double the original deposit. I do
not think this clause scares anyone but it might help you
in another situation. It is not uncommon for the seller to
sell the propoerty to someone else if they offer a higher
price. This has happened and can create a situation. A seller
in this circumstance may be willing to give you your deposit
back and to appease you or in effect - get rid of you. You
may recover double the deposit if you have the double deposit
return clause in your contract.
Of course, you are probably thinking that if you lose your
deposit or the owners do not sell you will simply take them
to court to recover. Taking them to court can be done if
you are patient, patient, and patient. If you eventually
win, you may recover if you are patient, patient, and patient
throughout the years. I think you understand this insight
into the court system here in Costa Rica.
Concerning the money, I advise clients never to use cash
because you have no paper trail and cash does funny things
to people in Costa Rica. There seems to be this need to figure
out how one can get there hands on cash and use it. Certified
checks from the states and regular checks can take a lengthy
time to clear. Better to open an account here, wire money
and get a ceritfied check from the bank in Costa Rica. Be
careful with deposits and control your money.
Every day there are many real estate transactions that occur
in Costa Rica without problems. As stated before I respect
all professions and business institutions. I do, however,
play the devil’s advocate in protecting my clients
in real estate transactions. I am available for consultations
and my fees are reasonable and fair.
Rudy Matthews
Home: 262-2083
Cell: 839-6931
email: rkmno@aol.com
If you want more information about the best real
estate affordable, please contact Costa
Rica real estate and retirement properties or call toll
free 1 888 581 1786.
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