Requirements to sell a property:
1. Check / verify that no debts (taxes) are associated with the property.
2. Have the latest receipts for the property taxes and utilities to serve as proof that there are no debts. Note, however, that the notary public will still need to proceed with due diligence to create non-encumbrance document to be processed and registered at the Public Registry of Property.
3. Prepare the contract of sale.
• The contract of sale is a voluntary agreement between the buyer and seller which outlines the operation and characteristics of the transaction, in addition to precisely defining the elements that are considered important. The preparation of a good contract of sale will spare wasted time with the notary, avoiding the need to have to change the conditions and hinder the sale process. The contract of sale provides protection in assuring that agreements are met and avoid future conflicts between the parties.
• The purchase and sale contract will be signed by both parties and witnesses and given to the notary. These will be the basis for the public deed of sale to be drawn up, in addition to providing the necessary documents for writing the deed of sale.
4. Finding a notary.
• A notary public is necessary to proceed with the transaction to carry out the necessary steps in preparing the public deed of sale.
• The notary is responsible for collecting the necessary elements for the transaction to proceed. With the Certificate of Encumbrance, the notary will send an early warning to Public Registry stating the intention for the property to be purchased. The notary will then require an appraisal to determine the actual market value of property that is intended to sell / buy as to determine the taxes.
• Once you meet all requirements, the Deed is prepared and taxes are paid. The seller and buyer sign the document of agreement and the property ownership will be transferred to the buyer. Then the notary will register the sale and change of ownership with the Public Registry of Property.
On taxes and other expenses:
The notary’s fees and expenses are borne by the buyer as well as the corresponding property acquisition tax. Borne by the seller will be the Income Tax (ISR) which occurs when the property in question is sold for commercial purposes. If it has been for residential use and the seller certifies he/she has lived there for at least two years (through phone bills, light, statements of credit card, etc.), the property is exempt from this tax.
This is a brief guide on the process of buying and selling, but if all this seems overwhelming, you can rest easy by using the services of a qualified real estate agency. If you are ready to list your home, make an appointment for an agent to visit your property, provide the required documents (copy of ID, copy of the water and electrical bills, and a copy of the Deed), and signed a service contract, in which will be outlined the commission granted in the event of the successful sale of the property made by the real estate agency.
The real estate agency will endeavor to advertise and promote your property using several different means and methods to attract potential buyers. Once the sale has been made, your real estate agent will guide and accompany you through the process of titling and transfer of ownership.
It is highly advisable to hire the services of a real estate agency, and it will save you time and trouble, and provide you with invaluable legal advice to protect your rights as a seller or buyer.