| We picked
it up for $.18 a meter (that’s eighteen cents!) or 4% of current
market value without any improvements or appreciation! He bought it cheap,
years ago, sat on it and just wanted his money back. We gave it to him!
In fact my wife saw it, liked it and raved about it. I had never even seen
it, but on her word we went ahead and bought it. After a recent trip there
for the first time, I am truly excited.
We have a local
‘caretaker’ there who helps to keep up the road, keep off ‘squatters’
and keep the fencing in good condition. He is a local native and knows
the area as his home all his life. He is our ‘scout’ and is able to bring
us deals that only other ‘locals’ would see or get. This gives us an ‘edge’
to find bargains in this beautiful area.
The other key
element we have found in making successful transactions, to avoid all the
pitfalls and eliminate the trickery and treachery of crooks, or well intentioned
but ignorant players or ‘campesinos’ in the market is the use of
one professional organization known as BOLCOMER which is the ‘Bolsa
de Commercio’ or ‘Commercial Exchange’.
It is a regulated
exchange which, historically, has dealt with the government and the private
sector in trading commodities and goods of all kinds. It is run according
to very strict guidelines approved by the Central Bank of Costa Rica.
Bolcomer now
offers real estate transfer and escrow services along with title guarantees
in addition to other types of business, whereby their legal professionals
can bring a level of transparency, accountability, professionalism and
legal thoroughness to successfully and safely complete transactions to
everyone’s satisfaction. The strength of Bolcomer has always been to bring
security and a level playing field to foreign and domestic buyers or investors,
when dealing in the unknown or unfamiliar local markets.
Bolcomer also
offers investors a very unique and attractive opportunity for secure passive
investment. Here’s how it works: Many land owners in Costa Rica are cash
poor. They have spectacular land but no money. Further, with no money
or little income, they also have no chance to qualify for bank loans if
they ever need money for other opportunities, for development or whatever
the need may be.
There is a
new system in Bolcomer which allows land owners to put their property into
a trust managed by Bolcomer. Investors can make arrangements to provide
the trust with certain funds which are secured by the property and then
end up with the previous land owner.
The Land Owner
and Investor negotiate the terms of the deal through Bolcomer. A typical
deal might look like this: 50% Loan to value (200% property guarantee)
and 10% to 12% annual interest for one or two years.
The previous
land owner now has the right to buy back the property from the trust at
the agreed upon terms. If so, the investor has an above market rate of
return with up to 200% security on his money. Good for both parties.
Option #2 for
the previous owner is to try and sell the property (if that was his
original intention) for more than what he owes the investor on it.
This allows him to generate cash from the property now, without having
to wait for the market to come to him, and gives him time to try and get
his price and keep the difference generated later on.
Option #3 for
the previous land owner is to just take the money and walk from the deal,
leaving the property to the investor. The benefit of using the trust is
that there are no foreclosure proceedings, legal headaches or court induced
delays as there would be if the investor used a mortgage to secure the
investment.
This is one
potential way to pick up properties for pennies on the dollar. Bolcomer
sees to it that all liens and encumbrances are cleared, title is good and
clear and even requires the title guarantee for the benefit of the investor
or buyer.
So, in the
end, there are some wonderful opportunities in Costa Rica. The real estate
market on the Pacific coast is ‘Red Hot’ and we are still seeing good growth
and appreciation despite what you may read elsewhere. Cost Rica is an increasingly
popular destination for retirees, ‘escapees’, ‘PT’s’ and
others seeking a better life.
It is fraught
with potential trouble as we discussed earlier so buyers need to be extremely
cautious. Having said that there is a ‘right way’ and the ‘wrong way’
of doing things here.
Seeing the
opportunities here, my wife and I have acquired an authorized trading seat
on the Bolcomer exchange and are also organizing an investment club for
those interested in exploring these opportunities or getting more information.
May you have
happy travels and ‘Good Deals’ ahead! If you would like help with moving to Costa Rica or just in general, Escape Artist Costa Rica is here to assist. Contact us using this form for help with relocation, buying property, retiring, or if you need a plain old fashion vacation or you can call 866-403-1345
The following
is the first article that Rex wrote for the magazine:
 American
Escapee Uses Computer To Make A Living In Paradise ~ Living
In Costa Rica
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