Anyone who has enjoyed a visit to a local winery, sampled the wares with cheese on a picturesque day and taken home a bottle only to later wonder, “how could I have ever thought this was good?” will appreciate that quick decisions based on ambiance do not always make for wise decisions. So, too, with buying property in another country. While few would purchase a home abroad as casually as a bottle of wine, a quaint Panamanian home or casita on the water can be quite appealing. That said, impulse purchases can be a good deal, but a few basic tips can help to ensure it’s a great deal. Make wise decisions on purchasing property abroad with these 12 basics tips for buying abroad.
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Some Tips for Buying Abroad
- Never sign a contract that you do not understand (for example – if it is in a foreign language).
- Always ensure that you seek specialist advice from independent Vendors, Architects and Surveyors before considering a purchase overseas. They should be proficient in your chosen country’s laws and processes and also know the specifics involved in buying a property there.
- Ensure you do not inherit a debt on the property before you purchase, which a solicitor should be able to check – i.e.: If the developer has borrowed money to build the development and this amount has been allocated against each plot as additional security to the developer’s bank.
- Always give yourself a `cooling off` period if you see a `must-have property` and are tempted to put down a deposit there and then.
- If you are arranging finance on the property, ensure that this is stated in any contract and you have an ‘opt-out clause’ if the loan is not agreed (which will ensure any deposit paid is refunded).
- Try to arrange your mortgage finance ‘in principle’, (if you need one) before agreeing to purchase the property, or before signing any contracts and paying over a deposit.
- Arrange your mortgage in the currency that you earn in where possible, unless you are going to receive rental income from that property in the local currency and then this may be a possible alternative option, dependent on the lender’s criteria.
- Think about combining your cash with friends or family: it could bring a Villa with pool within your financial reach, rather than simply a condo.
- Check with the Estate Agent or vendor to make sure that you are aware of the costs charged by the legal and government authorities for purchasing a property in your chosen country.
- Open a bank account in your chosen country and ensure you get a Certificate of Importation if required for the money you bring in from your home country.
- Set up standing orders in a local bank account to meet bills and taxes. Failure to pay your taxes in some countries, such as France, Portugal and Spain, could lead to court action and possible seizure of your property.
- Remember that bills do not end at the asking price. Lawyer’s fees, Taxes, Insurance etc must all be met in your host country and can be more expensive.