Normally, when someone advertises a property for sale, you assume he owns it. Why else would anyone advertise it for sale?

Well, it turns out there are lots of other reasons. Here is recent illustration. A client contacted me a while ago asking if I would check out a beach-house she saw advertised on a internet site. I said I would have a look at it the next time I was in that area. A couple of weeks later, I called the owner of the property, and arranged to see it. I arrived and was shown a nice house right on the beach. The property was Right of Possession (ROP), but my client knew that already and was willing to buy ROP. The price was very good, about $100,000 lower than a comparable titled beach house.

Everything was looking pretty good until I asked to see the paperwork. The man I spoke to showed me a thick file of documents, including Certificas from the local mayor and corregedoria, as well as a survey and documents submitted to have the property titled by Catastro. Then I asked to see the Bill of Sale to confirm that he had actually purchased the house. Well, that was when the stories began. At first, he couldn’t remember where he had left it, but later in the day he admitted that he did not have a Bill of Sale because he still owed money to the person he bought it from.

The long and short of it is that this individual had no evidence that he owned the property he was trying to sell. In fact, he did not own it because he had never made the final payment. He is hoping some naive foreigner will come along and buy the property without asking too many questions. That person will pay a lot of money and end up owning nothing. Make sure it isn’t you.

The moral of the story, once again is caveat emptor. Get a competent lawyer and a knowledgeable real estate agent. Ask lots of questions, and make sure you get clear answers.

{ 0 comments }