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Costa Rica is one of the most welcoming Latin American countries
for foreign investment. There are generally no restrictions for
foreign entities or people to acquire property or conducting
business in Costa Rica. Investors can establish local contracts and
enjoy the same protection Costa Ricans do.
Costa Rican National Registry
All Costa Rican parcels are registered at a main depository called
Registro Público de la Propiedad (Public Registry of Property),
located at the National Registry. It is in this building where the
titles for all parcels are registered. The Public Registry certifies
information about the property's owner, its location, topography,
area of coverage, plot maps, among other characteristics.
The Public Registry keeps records of all rights and interests that
pertain to any real property. The objective of this governmental
entity is to guarantee the security of registered property rights.
They assure the completion of such objective by inscribing and
publishing each record. Any title that constitutes, recognizes,
modifies or extinguishes any ownership right, usufruct, use, tenancy,
easement, mortgage or rental right must be inscribed in the Public
Registry. Titles which are not inscribed, or properly recorded, have
no effect against third parties.
When purchasing real estate in Costa Rica, you must make sure that
your property is accurately registered in the Public Registry.
Registering the property is much more important than the purchase
deed itself. That is because even though a person may have a legal
title to a parcel under his/her name, it does not necessarily mean
that s/he is the legal owner of the property.
As its name indicates, this entity is entirely public; therefore,
any citizen or non citizen can access the information recorded about
any property, such as the name of the owner, area coverage, liens,
encumbrances, annotations, rights of way and any affectation the
property may have. This information can also be viewed online
anytime at http://www.registronacional.go.cr/
In order to transfer the ownership of a property to another person,
the services of a Public Notary must be hired, who will write a
private deed between the seller and buyer. Even though this private
deed is legally valid by itself, it still must be inscribed in the
Public Registry records for it to be accessible to the public.
Title Insurance
Two of the greatest concerns foreigners have when purchasing real
estate is making sure the transaction is legally conducted, as well
as having the authorities' guaranty of lifetime use and protection
of the property.
In this respect, the Costa Rican legal system does provide ample
protection to investors; however, some of them prefer to secure
their property with a title warranty or insurance.
Any property title must be carefully reviewed before any sale or
purchase in order to detect any liens or encumbrances the Public
Registry may have recently recorded on the property.
This review is also useful in avoiding subsequent problems, such as
losing property that was not legally sold.
The Stewart Title Guaranty Company, a Fortune 500 company that now
has a branch in San Jose, offers escrow and title guarantee services
to protect the consumer throughout the process of purchasing land as
well as indemnify him/her for any losses that may unfold. Stewart
Title has been operating for 105 years. Its headquarters are located
in Texas, and it has established over 3,500 offices throughout the
U.S. and internationally.
The process of issuing a title warranty is divided in two parts:
- Title Commitment issued prior to closing, which allows the buyer
some time to check the property's legal status and determine whether
it is in proper condition for purchase.
- •Final title guarantee issued after the closing, based on the title
commitment.
Insuring property with titles is a new concept in Latin America, yet
it has proven to add significant value to real estate purchases and
re-sales. It also promotes transparency and increases liquidity
during the real estate process.
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