Costa Rica Real Estate Escrow Process: Requirements and Steps for Secure Property Transactions
Understanding the Escrow Process When Buying Real Estate in Costa Rica
When purchasing real estate in Costa Rica, using an escrow service is a common and secure way to manage funds during a property transaction. Escrow helps provide transparency, compliance, and protection for both buyers and sellers throughout the real estate closing process.
The following information outlines the escrow requirements in Costa Rica, based on procedures provided by AFC Accounting, and applies to transactions completed in a personal name or through a corporation.
Escrow Requirements for Buying Real Estate in Costa Rica as an Individual
Documentation Required for Personal Property Purchases
If the real estate transaction in Costa Rica is completed in your personal name, the following documentation is required to open an escrow account:
- Copy of a current passport
- Copy of the purchase-sale option contract
- Signed escrow contract with AFC, based on the purchase-sale option details
- Completed and signed KYC (Know Your Customer) form with basic personal information
- Proof of liquidity and origin of funds, which may include:
- The last three bank statements, or
- A bank reference letter including:
- Name of the account holder
- Account number
- Duration of the banking relationship
- Average monthly balance over the last year
This documentation must clearly demonstrate sufficient liquidity to complete the property purchase in Costa Rica.
Escrow Requirements for Buying Real Estate in Costa Rica Through a Corporation
Corporate Documentation and Compliance
If the real estate purchase is carried out through a corporation, additional documentation is required to meet financial due diligence and compliance standards:
- Copy of a current passport of the legal representative
- Copy of the purchase-sale option contract
- Signed escrow contract with AFC
- Completed KYC (Know Your Customer) form – Individual
- Completed KYC (Know Your Customer) form – Legal / Business
- Constitutive act and corporate legal documents identifying:
- Legal representative
- Company partners or shareholders
- For Costa Rica–incorporated companies:
- Legal status certification
- Shareholder certification
- Proof of liquidity and origin of funds, including:
- The last three bank statements, or
- A bank reference letter showing sufficient liquidity for the transaction
All documentation must confirm the corporation’s financial capacity to complete the real estate transaction in Costa Rica.
Funding the Escrow Account and Transaction Timeline
Security Deposit and Remaining Balance
Once all documents are reviewed, approved, and the escrow account is officially opened:
- The buyer may send the security deposit, if applicable
- The remaining transaction balance should be sent at least 4–5 days prior to closing
Each time funds are received, AFC will notify the parties and may provide:
- A funds reconciliation statement
- A copy of the bank notification
- A letter confirming the funds, if requested
Real Estate Closing and Disbursement of Funds
Distribution of Funds at Closing
For the property closing in Costa Rica, the escrow agent prepares a fund distribution document detailing:
- Amounts to be disbursed
- Bank accounts receiving the funds
This document must be approved and signed by both the seller and the buyer. Once the signed distribution document (in the same document) and a signed copy of the property transfer deed are received, escrow proceeds with disbursement.
- Documents received before 4:30 pm may allow same-day transfers
- Documents received after 4:30 pm are processed on the next business day
- If a cashier’s check is required, notice should be provided at least two business days before closing
Why Understanding the Escrow Process Matters for Costa Rica Real Estate
Understanding the escrow process in Costa Rica real estate transactions helps buyers and investors:
- Protect their funds
- Support compliance and documentation review
- Avoid delays during the closing process
- Navigate the purchase with confidence
Before completing any property investment in Costa Rica, it is important to evaluate priorities, understand requirements, and work with experienced professionals. If you are planning to buy real estate in Costa Rica, obtaining accurate information and guidance can support a secure and successful transaction.
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