Saturday, October 24, 2009
Dear Reader,
In the past few weeks as Tip #1, Tip#2, Tip#3 and Tip#4 of her “Twelve Things you Need to Know to Do…and Then Do” series, Margaret strongly recommended that you:
1. Engage your own independent legal advice,
2. Buy the right title insurance,
3. Check which items to look out for in your sale contract,
4. And check your title deed carefully.
This week she tells you about permits and approvals.
Over to Margaret…
“Step #5: Check the Permits and Approvals Permits and approvals are becoming more difficult to get, and more expensive. There’s quite a range of them, and they vary from country to country. The standard ones are environmental permits, water permits, construction permits, and municipal permits. Permits and approvals vary from state to state, too; some states in Mexico require a sales permit, for example. Have your in-country attorney check to make sure that your seller/developer has all the permits and approvals he needs to comply with current regulations.
Many countries require developments to have developmental and environmental pre-approval before they can legally market or sell a property. That all takes time and money, up to two years in some cases. Until the developer has pre-approval, he cannot start selling—and he also cannot start construction or the infrastructure.
You could say that you are happy to wait for one last permit to be granted to a developer or seller —but make sure that your money is escrowed if so, and by escrow I mean with an established company like First American Title Insurance—an approved escrow. Otherwise, you could find that the development does not get the green light and you may find it tough to get your money back.
In some countries, you can see houses for sale that have either never applied for planning approval, or had initial approval but subsequently added an extra unapproved bedroom, or garage. This is particularly true in rural areas. Sometimes you only need to pay a fine or tax to get retrospective approval. Have your attorney check for you, and ideally get the seller to legalize the property before you buy it.”
Don’t think that your due diligence process is just boring paperwork. I always recommend that you visit before you buy. This is a central part of your due diligence. It’s also fun. This is where Pathfinder Chill Weekends come in.
A Chill Weekend is nothing more than an opportunity to enjoy a short vacation in exchange for allowing a developer the opportunity to showcase a property or development he is promoting.
No strings, no high-pressure sales tactics, no hard sell, just a chance to investigate some real estate opportunities (and check out the beach, of course!). Best of all: the developers pick up some of the tab.
This December, our friends in Nicaragua will host Chill Weekends.
December 9th-13th, 2009: If you’ve ever fantasized about living in a tropical paradise, then why not make plans to join us on December 9th to 13th for a chill weekend at Rancho Santana. All you have to do is show up at Managua airport—and we’ll take care of the rest. You’ll get a taste of colonial Granada, and have the chance to explore Rancho Santana…relaxing on one of the five sandy beaches…snorkeling, surfing, horseback riding…or simply swinging in a hammock rocked by cool Pacific breezes.
Better yet, you’ll discover how you can cash in on an amazing undervalued Pacific Coast real estate opportunity—with home sites from $47,900.
The trip costs $299 per person, and covers your accommodation, airport transfers, and meals. Book your Weekend in Paradise here.
Ronan McMahon
Posted Under:
chill weekends, emerging market, due diligence
Want More?
Sign up here for your free Pathfinder Alert e-letter, and we’ll send you our $50,000 Report...showcasing seven real estate opportunities for $50,000.
