We work with clients all around the world from Russia and Europe to North and South America. We provide our expertise and services to those, who are interested in real estate investments in Panama. Our company can be “One-Stop Shop” in matters of purchasing real estate, starting from consulting services and explanation of exact steps that must be taken down to a successful deal. We will share some of the useful tips and steps to be taken to help you here.
- Who is eligible to buy property in Panama?
According to the Constitution of Panama, foreigners have absolutely similar rights while purchasing real estate with Panamanian citizens. The only exception is the properties that lie in 10 mile zone off the borders with Costa Rica and Colombia.
- Study your options and their owners
Before you sign anything, it is absolutely essential to study thoroughly all the property variants as well as their owners. You may run the seller’s name through Public Registry or Ministry of Economy and Finance to be sure you are not doing business with a debtor, plus the property is free of any charges or restrictions that could inhibit transfer of ownership. It will also show you that the person you are dealing with is the owner of the chosen property indeed.
- Singing the sale agreement
The document must include all the terms and conditions that will govern the relationship between buyer and seller. These terms may vary depending on the state of project: it can be just a construction site as well as resale in an existing building. Just be cautious and remember that most important articles of the agreement are forms and terms of payment and penalties in case of irresponsible actions of one of the parties. Those articles are of high importance if you would like the transaction to be completed successfully.
- Language of the agreement
In case the agreement is written in Spanish and one of the parties doesn’t understand this language, it has a right of requesting a translation done by a licensed public professional for the language that the party prefers.
- Taxation
The seller must provide documents, which prove that the property will be transferred free of levies, debts and taxes. For instance, the party should provide the receipt of the payment of transfer tax (which amounts to 2% of the property price), receipt of the property tax, utilities fees and their receipts (water, electricity, garbage collection etc. (it can be issued by IDAAN - Institute of Aqueducts and Sewers).
- Mortgage calculation
In case you buy a property that has a mortgage in one of the local banks, the owner should pay off the entire amount owed to the bank. In this case the bank will issue note of settlement for the mortgage, which is to be inscribed in the sale agreement and also recorded in Public Registry.
- Bank financing
In cases when any of local banks provides financing for real estate, the policy often requires that sale agreement is prepared by the bank itself, because beside the agreement, it would also contain information about financing. Thus the bank will require the Act of sale, receipt of paid taxes and any other relevant documents.
- Notary act of sale
The act of sale must be certified by Public Notary of the Republic of Panama and then registered in Public Registry. Besides, it the receipt of the payment of all taxes and levies mentioned above must be attached to the Act.
- Public Registry
Once the Act has been duly approved and registered in Public Registry, the property right comes to the new owner. The registration process takes up to 10 working days.（The process can be faster if you pay $250）.
- Making change about the owner
Once the Act has been registered in Public Registry, the copy of it must be presented to Land and Property Registry in Ministry Economy and Finance. This is done with the purpose of correcting information about the owner in the system. The operation takes up to 15 working days.
