The following information is a general guideline of how to buy a real state. Thus, these recommendations are to be taken into account before the investor signs the contract or transfer the money to Colombia.
Verify the information of the property that it is going to be purchased:
In Colombia the information or “history” of the property is in the Ownership History and No-lien Certificate (“Certificado de Tradición y Libertad”). This certificate has the list of the owners of the property and has any encumbrances that a third party may have, such as a mortgage.
Taking this into account, it is recommendable that the investor verifies the Ownership History and No-lien Certificate. This can be requested to the Public Instruments Record Office ("Oficina de Registro de Instrumentos Públicos"), which is the government entity in charge of these certificates.
To be able to request the Ownership History and No-lien Certificate of a given property it is necessary to bear in mind the following:
1. There is various Public Instruments Record Offices in the country. Each property or piece of real estate is registered in only one. Thus it is necessary to find out in which Office is the history of the property registered to be able to request it.
2. Once it is determined which Office has the history of the property, the investor must provide one of the following pieces of information:
a. Real Estate Identification Number. In Colombia each piece of real estate has one identification number.b. Address of the property, in rural property this might be difficult to find out.c. National Identification Number of the owner of the property.
3. The investor must pay the cost of the certificate. To pay this, each Public Instruments Record Office might have a different mechanism or account number. Thus each investor must find out where he must cancel the cost of the certificate. Here he must verify that the person who is selling the property to him is really the owner or that he has an authorization to sell the property in representation of the owner.
4. Another additional aspect to verify when buying property is the tax payments. In Colombia, each property has to pay the “Property Tax”, since this is a municipal tax each Municipal or District Treasury will have the history of the payments of this tax. The investor must go the Treasury of the Municipality or District where the property is located and ask for the payments certificate where the property should appear with the tax payments up to date.
5. If the investor wants to purchase the property without coming to Colombia it is necessary that he authorizes someone as his legal representative authorized to do such purchase and registration behalf the Central Bank. The document stating the person who is given the legal representation must have the Apostilla for those countries which are part of the treaty or duly notarized in the rest of the countries.
Aspects to take into account in the Sale Contract or Promise of Sale Contract.
It is recommendable that the sale contract includes at least the following aspects:
1. Area of the property.
2. Boundaries of the property by the north, east, south and west side as they appear in the Ownership history and no-lien certificate. (In Spanish the name of this appears in the certificate as “Linderos”)
3. Price
4. Payment stipulations.
5. Term or certain date when the property must be given to the new owner.
In Colombia when two people are signing a sale contract of real estate, there is an additional requirement from the actual signature of the document. This requirement is called a “Public Deed” where a public notary will authenticate and emit the Public Deed; if this step is not done the contract will be void. For the notary to emit the Public Deed the investor must submit the following documents:
a) Text of the sale contract which must include the following: name of the buyer, name of the seller, identification number of each one and the other aspects mentioned above.
b) If the property is in Bogotá it must submit the certificate of the Urban Development Institute “IDU”. Where it states it is up to date with the payments corresponding to any community upgrade value gained. The “community upgrade value gained”; is a type of tax that property owners must pay when a public construction has increased the value of the property. www.idu.gov.co
c) Certificate where it says that the property is up to date with the payment of the Property Tax or receipt of the last payment.
d) If there is a condominium or any other type of housing arrangement where there is an administrator, the administration payments must be up to date.
The Public Deed has a cost of 0,27% of the value of the Real Estate. It is a costume that the owner and the buyer will pay 50% of this cost. The Public Deed will be ready in 3 to 20 days depending if all the documents are submitted accordingly.
Register the Public Deed in the Public Instruments Record Office
As it was explained before, the Ownership History and No-lien Certificate is the history of the property. Thus, it is very important that the investor registers in the Public Instruments Record Office the Public Deed, when this is done then the investor is the actual owner of the property. This is verified by checking the name that appears in the certificate.
It is important to recall that the investor has register the investment with the Form No. 4 of the Central Bank once the money is wired to the Colombian account.
 Urban Law | [Urban Law] | 26 Kb | 01/07/09 14:36 |
