Saturday, September 19, 2009
Last Sunday I got the chance to see the new George Clooney movie “Men who stare at goats” at the Toronto Film Festival. It might seem like a far-fetched idea (watch the trailer here http://www.youtube.com/watch?v=LS-jutv-rh0 )...that a man could kill a goat with a stare. I’ve seen something that comes close.
It’s a developer trying to pull the wool over Margaret’s eyes. Some even joke about choosing death over that stare (I’d probably put myself in that camp).
Whether on the road scouting or back in the office, Margaret spends her time meeting with lawyers and developers and poring over project paperwork. She’s seen just about every scam, omission, mis-statement and flat-out lie there is. You couldn’t buy this experience. You couldn’t train this experience. An Ivy League school couldn’t offer it as part of their MBA program. It comes from nearly four years of dissecting (with the help of top lawyers) representations made by developers.
Over the coming weeks she is going to share with you the “Twelve Things you Need to Know to Do…and Then Do” when buying a property overseas. She breaks it out clearly and simply. She won’t try and confuse you with complicated legal jargon. It’s not necessary…and anyway she isn’t trying to justify a big fee.
The experience she is going to share is free to you as a reader of The Pathfinder Alert.
Make sure not to miss out. This is valuable information.
There’s something about buying a property overseas. The purchase process is alien to the one back home…you don’t speak the language… and it’s all so exciting and full of possibilities. It’s easy to get caught up in the buying process, and it’s very easy to get carried away. You need to remember that some things stay the same. Don’t leave your common sense at home.
I don’t know whether it’s the sun, the rum, or a heady combination of both, but many people take risks when buying a property overseas that they would never take when buying back home.
Sure, you’ve met a guy in a bar who tells you that he can show you this great piece of land, that’s a sound investment. He knows the owner who’s owned it for generations, and because it’s you, he’ll negotiate a special price. He has a friend who is the best attorney in town, who can do your due diligence for you, for a special price. Your newfound friend tells you that the land needs a permit before you can build your home…but you won’t have to wait months for that, because he has a cousin in the planning department who can help…for a special price. That’s the way things work in a foreign country, right?
You wouldn’t buy a property back home this way. You’d have an attorney, and a broker you’d worked with before, or who come with recommendations from friends and family. You’d do your own due diligence, and you’d comply with all the local laws and systems that regulate property ownership.
So why do things differently overseas? You should do the same due diligence, and exercise the same caution, that you would when buying back home.
To help you do your due diligence, I have compiled the following checklist you should follow with all your overseas property purchases.
I’ve broken it down into 12 must-follow tips.
Tip #1: Hire a good, local, in-country attorney Your US or Canada-based attorney may work wonders for you…but he is not likely to be familiar with the intricacies of buying a property in your chosen country. You need an in-country attorney.
Your local attorney should work for you—and only for you. He should not represent anyone else in the transaction. That may sound like a given…but in many countries, an attorney can legally represent both sides in a transaction.
Your attorney should be bilingual. It’s going to be tricky enough getting to grips with a different buying process. If you can’t understand what your attorney is instructing you to do, the whole process could quickly become a nightmare.
You should be aware that while the US and Canada have common law, in most of the rest of the world civil law applies. Civil law is very black and white. There’s no pleading for fairness…you are either right or wrong. Some terms may sound similar but will mean something very different. Joint tenancy with rights of survivorship is one. You may have used it to avoid probate if one partner dies, back home. It does not apply in civil law. It can be confused though with tenants in common, which does apply in civil law—but means you will have probate if one partner dies. Be very clear explaining to your attorney exactly what you are trying to achieve.
Don’t take a seller’s word for it: have your attorney check everything that they tell you regarding the property.
Also, have your contract translated and read it carefully yourself. Ask your attorney to explain anything you don’t understand. Your attorney may not explain a clause that is normal procedure in his country—but it may be very different to how you’d do things back home.