Coastal Real State
Transactions
STEPS
LOI
Non-binding document
Very general terms and conditions of the transaction
Drafted by the real estate brokers
Signed without our intervention
What you need to know!
What to include in the LOI
Parties´ full names and ID numbers
Property ID number, area and survey number (and inventory, if applicable)
Purchase Price
Earnest Money Deposit percentage or amount (typically 10%)
Escrow Agent (if one will be used)
Due Diligence Period (typically 30 calendar days)
Brokerage Fee and Agent(s) involved (typically 6% plus VAT)
Closing Costs (who bears them)
Period to prepare the SPA (typically 7-10 calendar days)
Exclusivity
Notices Addresses
Expiration date and time
Any other information related to the transaction
Copy of the parties IDs
SPA
Binding document
Written/reviewed by buyer’s counsel
Detailed in terms and conditions
Scope of due diligence, including special conditions
Choosing of escrow agent
Escrow Agent
What you need to know!
TLA Financial Services if funds are not going to be disbursed in Costa Rica at closing
Stratos Fiduciaria if funds are going to be disbursed in Costa Rica at closing
Technical Due
Diligence
What you need to know!
Topographic Report
Boundaries
Measurement
Constructions (footprint)
Construction Setbacks
Access to water via AyA, ASADA or well
Wells (artisan or drilled/concessioned)
Creeks, rivers, etc. (setbacks)
Access to electricity (nearest pole, if applicable)
All aplicable easements
Maritime Zone Concessions
+ In addition to the fee simple property due diligence +
Complete review of the corporation – company that holds the concession (including Public Registry, Litigation, Tax, Employment Matters, Material Agreements, etc.)
Review of the concession file.
Review of environmental documents.
At closing Prepare a trust agreement or endorse share certificates (including the national shareholder who must be provided by the buyer to comply with the Maritime Zone Law)
Ongoing business
Fee simple property due diligence +
Review of the corporation – company that owns the business (including Public Registry, Litigation, Employment Matters, Material Agreements, Financial (loans, promissory notes, leases, security agreements, etc), Taxes, Health Permit, Commercial License, Legal Books, etc.
Development (condominium regime)
+ In addition to the fee simple property due diligence +
Review of the condominium bylaws
Certification from the Home Owners Association of the status of the property
