We frequently serve clients in matters related to the acquisition or sale of real estate in the entire territory of the Republic of Panama or for procedures ranging from value updates to the registration of properties under the new regime of Family Tax Patrimony.
Unfortunately, also in the analysis of the cases that are presented to us, we find those where there are errors in the records, or they have the values or other outdated data. These errors or omissions can cause delays of many months that cause damages when it comes to a purchase or a sale, it can even cause a loss in the sale if its property that has been paying real estate tax based on the wrong value.
As advisors in a real estate transaction, we must follow several measures before advising the client to sign a promise to purchase or a final purchase agreement, that is, to enter a due diligence process to ensure that the values, measures and other important details are correct. Here are some important recommendations to follow when you buy or sell a real estate in the Republic of Panama.
Legitimacy to Sell.
It is important to verify at the Public Registry that the seller, whether it is an individual, group of individuals or legal entities, is/are the legitimate owners of the property.
Where an individual or individuals are the owners of a property it is important to verify that their details are correct and that they have legal capacity to enter obligations.
Where a company or other form of legal entity is the owner of the property, it is important not only to verify that the details are correct, but also that the company is in good standing, in existence and that the individual representing the company complies with the legal capacity refer to above.
What is being sold?
Once the ownership of the property is verified, the transaction can continue is course and further due diligence must be made on the property itself when the same is owned by an individual or group of individuals. We will discuss this part further ahead in this section.
However, when the property is owned by a legal entity it is important to discuss with the seller the object of the transaction, whether it is the shares of the company or the underlying property.
Should the object of the sale be the shares of the company, it is important to review the corporate documents of the company as our experience indicates that in many cases errors and absence of important documents delay the closing of the...