The Buying Process

To buy real estate in Nicaragua there are several things you need to know especially if you plan on attempting the process yourself. First, title in a foreign country can be a tricky thing. Taking into consideration Nicaragua’s past, it’s very important to hire the services of an attorney to guarantee the property you purchase will remain yours without future legal hassles..

 The buying process can involve several people depending on the path you take. In recent years with so many foreigners buying real estate, many of the more knowledgeable and active foreign buyers have started consulting companies to help new investors and retirees in the real estate process. Since there are no laws or restrictions governing real estate agents in Nicaragua anyone can become a real estate agent and the industry sometimes has a bad reputation because of the lack of knowledge of many working in the field. These consultants recognize this problem and are making the process feel more Americanized and easing the buyers’ minds with a more recognizable process.

Whether you choose a consulting company or a real estate agent, do some checking before you make a commitment. Once you’ve chosen someone to find you a home you’ll also need someone to supervise the transaction from start to finish, preparing the proper paperwork and verifying title and other legal aspects. For this you’ll need an attorney. If you choose a consultant you can be sure they will have several attorneys they feel comfortable referring. If you choose a real estate agent they too will probably have someone to refer you to. Always consult with your potential attorney before you commit, conduct an interview and ask all the questions you can before making a choice.

Once you’ve located the perfect property negotiations will begin between the buyer and the seller. Once a price has been determined other legal aspects will have to be verified before you go any further. Your attorney will need to see title on the property and the properties tax payment history. Once he has determined everything is legal and proper a notary can prepare a sales agreement. Once payment has been made your attorney will record the property in your name.

The costs to buy property in Nicaragua are reasonable and pretty straightforward. Title insurance is available and the title company relies on an attorney to provide them an opinion on the title of each property they consider for insurance. They have a list of approved attorney’s and only properties evaluated by these attorneys will qualify.

The cost for title insurance is approximately $500.00 per $100,000 insured. The buyer pays this fee. A transfer fee is applied to all real estate transactions. This fee runs about 4% of the purchase and is a fee paid by the seller. A recording fee of ½% is paid by the buyer. The legal fees are usually 1% and the buyer and seller pay their own attorney as well as their own real estate agent. The consultant or real estate agent fees vary so negotiating this fee up front will save an argument later. Property tax is 1% of the assessed value. This value is not necessarily the price you paid for the home. Property taxes are paid yearly to the Municipal Government. If you are a retiree there are many tax advantages for you that can save you money every year.