Property Purchase in Brazil, Consider This Before Anything Else

Brazil is perhaps one of the few emerging markets that allows foreign buyers to own both land and property in their own names on a 100 per cent freehold basis – making the property purchase process relatively straightforward. However, before you can buy a property in Brazil, even though you are working with a licensed realtor you still need a trusted legal advisor to inspect documents and advise on the purchasing process.
The most obvious support is the inspection of documents and due-diligence on the property deeds.
A proper due diligence should cover the following:

1 – Before the property purchase, a thorough investigation.

A proper investigation will show If there are any liens or encumbrances and who owns the property. Sometimes sellers will negotiate real estate that they do not legally control or that has outstanding debts.

2 – Check the seller’s documentation.

Your legal advisor will check all of the developer’s most relevant documents, such as the articles of organization to check who the shareholders are, how long has the company been in business and if they are up to date with their fiscal responsibilities. Are there any court actions against them that could jeopardize the deal? A real estate law expert should gather and analyze all of the information. There are many things that could go unnoticed by the untrained eye. The realtors or the sellers may not have missed them intentionally, but the legal advisor can notice before it turns into a bigger issue.

3 – Check the development.

Depending on the type of project you are embarking in, there many different things your lawyer will need to look after. I am going to mention the most common.

if the property is near the beach, the deed should mention it. If it is “off plan”, it must be already incorporated. All the environmental should be in place. If they have expired, the developer should have already reapplied for renewal.

Also, have your legal advisor check the contract for you. Especially if the property is still being built. The contract is an essential part of the purchase process. If done properly, it will determine the success or failure of the deal. These are some of the things a contract should cover:

• International money wiring.
• Payment delay penalties.
• Property delivery delay penalties.
• Water and electricity supply (in case of plots of land).
• Furniture to the amenities.

Moreover, it is important to be advised on how to register the investment correctly in Brazil. There are no taxes on retrieving a foreign investment from Brazil. But correctly registering the investment at the time that the real estate is bought is paramount.

And of course, it is also necessary to verify that the selected lawyer is legitimate. This can be done online with a service on the national lawyers registry, provided by the Brazilian Bar Association. You can search for lawyers based on name or OAB number. You are then able to verify the status of their license as well as see their photo.

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