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Buying new apartment, not receiving deed until all units sold??
- Thread starter FuturoBA
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- deed escritura title deed
earlyretirement
Moderator
Yes, that can happen but it depends on the building but in most new construction if it's a good developer, by the time the building is done, all the units will be sold or close to it. I've purchased hundreds upon hundreds of properties and a few times there were still apartments not sold.
But even in buildings ALL sold, it can take many months up to a year to get your actual title deed. You will get paperwork at the closing that shows you own the property but the actual escritura (title deed) most times takes many months to get. Remember that by law you can select the Escribano to be used EXCEPT in new construction when the seller/builder uses the same escribano that THEY select.
Just make sure you are buying from a reputable developer that has been around MANY years in Buenos Aires. I can tell you some horror stories from people that try to hire us to fix an issue but nothing you can do if they don't finish. I just had dinner with a well-known Twitter blogger and he said he purchased several units that are many years late. I'm not sure they will actually finish.
The building has been completed and the seller is an individual investor, so not buying from the developer. I hear this is common, where someone buys a unit in pozo/development and sells when it's completed. Does the same law apply where he chooses the notary/escribano?? Also at this point, just verifying, it sounds like I don't need a CDI, is that the case and CDI would then be needed once I receive the actual deed?
earlyretirement
Moderator
Ok, if the building has been completed then maybe this is a resale and you are "buying his boleto". Maybe the buyer bought it an now is flipping it. You must still use the same Escribano as the building IF he didn't already close on it. Did he sign the escritura? Or will you be the first one that is signing an escritura? he didn't sign the escritura yet than you are legally the first buyer.
You need a CDI number once you purchase the unit and paying for it. They must have your CDI number once you're ready to sign the paperwork for the possession of the property. It will take a few months to bet the actual escritura (title deed). But you want to make sure everything is on the up and up. Talk to the developer and confirm that the escribano used is the same one for the entire building.
We have seen a few cases where there were fraud and abuse. Just make sure you have a very reputable Escribano. If it's the building's you may want to have them checked out. There are NO room for mistakes on something like this.
One time we had a situation like you describe. And the boleto was sold but it seems like 2 people owned it. Two siblings. Then one moved to Spain and the other sold the land and constructed. And then sold the plot of land without their permission. It was a mess. Just make sure even if you're not dealing with the developer you talk to them and find out all the details of who bought it, details of it, etc.
Yes I am buying his boleto and therefore he hasn't signed the escritura, is my understanding. So would this mean it would be the buiding/developer's escribano as opposed to the individual seller?? Either way I will have them checked out. Speaking of which, how would you find out if their escribano checks out?? Other than google, is there some sort of data base you, so ways you'd recommend??
earlyretirement
Moderator
Great. Yes, so technically YOU are the first buyer of that unit. You would be buying his boleto from him. Just see the process on that. Typically if you're doing it legally, that person would need to register the change over to your name and pay some taxes. But sometimes they are informal about it. You can ask the escribano for the builder as you will be forced to use that Escribano for your closing. Get their information and ask them.
You can take the Escribano's details and then go ask at the Colegio de Escribanos that they are legit. Ask them ahead of time for ALL the details. Including what their fees will be, what the stamp tax breakdown is. ALL closing costs and I always recommend to get this BEFORE closing. You should also ask them how much the "Fondo de reserva" amount is. That is the "reserve fund". When you buy a new construction unit they have to collect an upfront amount to pay for amenities like gym, pool, etc. Ask them what that amount is now vs. later. Sometimes it's shockingly high. Ask them for the administration rules of the building HOA. Ask them how much monthly expenses will be. Usually they have a formula of $X to X meters.
StatusNomadicus
Well-known member
and @FuturoBA this might be a deal-breaker for me, depending on if i feel like the Escribano is working for me and answering questions, or just assuming you're going to go along with everything and not try to do your due diligence. from what i have read, it seems like the Escribano is the most important part of a purchase
earlyretirement
Moderator
Yes the Escribano IS the most important part of the equation. But keep in mind on new construction you MUST use the same one for the entire building and all the new owners and the BUILDER is the one that selects this lawyer. So keep that in mind. Once an owner closes on the property and if they flip THEN you as the buyer can select the Escribano to be used.
Yeah I don't know anything about this escribano and was hoping to use my own. My broker is trying to find out who he/she is and going to my due diligence.
It sounds like then I'll be using the one the rest of the building used, which gives me some more reassurance. The current seller hasn't closed and I'm in essence purchasing his boleto.
Swowbird
Well-known member
You have to use the builders lawyer. The same thing happened with my friend. Someone flipped but he had to use the builders lawyer. Just make sure if he flipped it that his boleto is all legit and registered with the city. Later you might have problems if the real owner said they never sold it. My friend did this a few years ago. He did the same thing you're doing. Then later the guys brother came back and said he also owned the apartment and he didn't get his permission.
Trust me. Ask the seller if the boleto he is selling you is official and registered with the city. He has to legally pay some stamp taxes and it has to be registered with the city. If not, you can have problem later. Same as the escribano.
Please explain further. Is it the boleto that's registered with the city or the deed/escritura or both?
earlyretirement
Moderator
Yes, @Swowbird sounds like s/he know what they are talking about. You have to basically go into every transaction assuming the worst-case scenario. It's like mental chess. You have to think 10 steps ahead. Remember there is NO legal recourse there. If you get cheated, you can't do anything because the legal system doesn't work there. So even if you get cheated by an Escribano for a building you basically are screwed and that's why you MUST make sure you're doing things right from Day 1.
I see a lot of people trying to save money and then they get screwed. I always tell people during an initial consultation the #1 most important person in the transaction is the Escribano. That person is the one that is responsible for making sure there are no liens/encumbrances/issues with not only the property but the water company, electricity, gas and HOA. On new constructions you may think this is easier but not always the case.
What Swowbird is referring to is lots of locals buy a property and do a boleto or put money down. And then they are basically flipping their interest in that property. Sometimes their name isn't registered anywhere legally. What they try to do sometimes is just get you as the new buyer (Buyer #2) to just pay the funds to the developer and take over. But legally they are supposed to register that boleto and pay partial stamp taxes, etc.
If everything wasn't done properly or things recorded correctly for that first buyer #1 then you may or may not have issues. It's always better if you're buying an interest and taking over to make sure Buyer #1 has registered that boleto with the Escribano for the developer. Most times you won't have issues but I HAVE seen issues before when a boleto wasn't registered and then issues popped up later. @FuturoBA on that property you're interested in taking over the flip, just ask the realtor or developer or however you found out about the property if the Buyer #1 has a registered boleto and everything is 100% legal on it.
This is NOT like the USA or other first-world countries. Things are complex here. Nothing is really easy. Remember this is a 100% cash transaction where there is NO room for mistakes. NO real legal recourse and even if you try to sue someone including an Escribano you're pretty much SOL for many years. And even when it makes it's way to a judge, you can get screwed by someone buying off a judge.
I will post some real-life stories later when I have time. I'm including them in my autobiography and it's all really fascinating stuff. Take whatever notion you think you know in the USA or other countries and throw it out the window here.
Swowbird
Well-known member
See @earlyretirement post above ^^^^^^
In my friend's case, he bought a new construction property in Palermo Hollywood many years ago. A local put down just a little money. Apparently, it was a friend of the developer or maybe a family member. And the escribano was also a friend or family member. See where this is going???
Apparently, the apartment deposit was by two brothers but one moved to Spain. The other brother didn't tell his brother he was selling the boleto. But there was no paperwork. Just some deposit that was put down. The brother flipped the boleto and sold the apartment but the contract was in both of their names originally. They just had my friend pay the full balance and the deed was recorded only in my friend's name.
I may be leaving out details but I do know my friend went through this painful ordeal and it took years and years. When he wanted to sell it he couldn't because the other brother from Spain had some paperwork. When my friend tried to hire a lawyer the lawyer asked him where his boleto was for the property purchase and if the first buyer had any paperwork.
Just ask them if the person that originally bought the property has done a formal boleto and ask them to see a copy of that boleto. It should be certified by the SAME Escribano that will do your closing. Because remember on new construction they all use the same Escribano. If that Escribano says they didn't do a boleto then you know something is probably out of place.
If they come back and say there is no legal paperwork for buyer #1 then you may want to pay a lawyer or Escribano to review the paperwork. In Argentina you always think you are saving money trying to do it yourself and almost always you cause yourself incredible headaches by not doing it right the first time. Good luck. Let us know how it turns out.
The combination of 100% cash and the weak legal system no doubt makes it intimidating. Even if one does everything right things can still go south. Like you said gotta think 10 steps ahead to bring the likelihood to as close to nil as possible but wow when I think I have it some what figured out, BAM seems like the goal post keeps on moving.
Damn sounds like a mess and a half. How would he know everyone involved was related for such a conflict of interest.
First thing is always get paperwork, although in your friend's case, working against who was up against may not have mattered or still an uphill battle.
And from my understanding this is where a competent escribano comes in. They would have seen the contract and couldn't move forward and the boleto shouldn't have been flipped unless both brothers signed off.
So this begs the question, if you're required to use the builder's escribano for the sale, are you still able to hire a separate escribano to make sure the first one actually did what they were supposed to do?? Or to have someone audit the original's work and have redundancy to ensure everything is legit (or as legit as possible, being as what I'm finding out; this is Argentina)
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StatusNomadicus
Well-known member
https://buysellba.com/buying-real-estate-in-ba is a good start for anyone else joining us here
recently learned we've all been taught wrong, and the phrase is 99% not needed: https://www.writersdigest.com/write-better-fiction/begging-the-question-how-to-use-it-correctly
earlyretirement
Moderator
I bought a LOT of pozo properties but the good thing is the vast majority were with the same developer. I have purchased with GyD developers for 22 years. And with them, I always dealt with the same Escribana. A really nice woman that I had the chance to get to know and they used the same one on each property. On those I NEVER had any issue. Even when I was buying someone else's boleto. They had all their i's dotted and t's crossed.
You will find there are a lot of conflicts or outright fraud with other people. In real estate in Argentina there are so many commissions involved or fees paid. Some foreigners just do things that they wouldn't do back home. They would use common sense in the USA yet they come here and don't speak the language and they do dumb things. Like sign a contract that is in all Spanish and not know what it says. That is just dumb. Even if you speak a little Spanish, there is a lot of difficult legal terminology in written contracts. Especially to purchase property so you should be asking to get ALL of those documents translated to English (you typically have to foot the bill). There are people that can easily and quickly do this. Know what you are signing! Would you sign a contract in the USA that you don't 100% understand? No. Don't do it here either.
Yes, even if you're buying in a new development you can pay a lawyer/escribano to review all the paperwork. They will charge a few hundred dollars to do that. they will check to see if everything looks good and maybe can even check to make sure that Escribano for the building is in good standing with the Colegio of Escribanos (the Bar Association in Buenos Aires). I'm not sure what they charge these days. But DM me and I can provide you with a referral to someone 100% trustworthy. I've worked with the same Escribanos for the past 22 years. They are the best in Buenos Aires. One is a 2 time ex-President of the Buenos Aires Colegio de Escribanos.
I wouldn't say on a brand new property you need to hire your own lawyer to review. I'm only mentioning to make sure if you're buying someone else's boleto that everything is on the up and up. If that person bought and did their own boleto (30% down payment) there should be a legal record of that with the Escribano for the developer as s/he would have done it for them. Signed and fingerprinted. And also some impuesto de sellos paid.
What some of us are telling you is that this isn't like back home. Know what you're doing at all times. Know what you're signing and understand the process completely. On a pre-existing property, NEVER use the escribano recommended by the realtor. They are usually buddies or friends or something. Just research and find your own ethical Escribano by research or referral. I can't emphasize this enough but the system here is messed up. Because the Escribano doesn't get paid a penny until the title deed closing. Do you really think if there is some issue they are going to tell you @FuturoBA we found an issue, don't buy this and we aren't going to make any money? You MUST have an Escribano that is willing to do that. Because if not and you buy something, you're basically screwed and it will take years to solve.
Good luck.
MikeAnton
Member
@FuturoBA did you complete the purchase of that boleto? How did it go? I am looking at a new construction that is a few months out and I would be essentially buying a resale and I was curious how your transaction went? There really aren't a lot of properties for sale that are good. Many properties for sale have horrible kitchens or bathrooms that are in poor condition. Because of that I am mostly looking at new construction properties.
BuySellBA
Administrator
Don't be afraid to do a renovation of the kitchen and/or bathroom if you find an apartment that you like that has good bones and a good floor plan. Most properties in Buenos Aires have dated kitchens and bathrooms but that shouldn't stop you from purchasing something that you might like besides a dated kitchen or bathroom. You can hire a reputable architect that can renovate the property for you at a fraction of what it would cost in the USA.
You can see estimates to renovate a kitchen or bathroom here at this article below. Just keep in mind with inflation, prices keep moving up on renovations and real estate prices should continue moving up as well. We hit the bottom a few months ago.
Real Estate News - How much does it cost to remodel the kitchen and bathroom - Reporte Inmobiliario
How much does it cost to remodel the kitchen and bathroom - Reporte Inmobiliario Source: https://www.reporteinmobiliario.com/article5424-cuanto-sale-remodelar-cocina-y-bano February 26, 2024 How much does it cost to remodel the kitchen and bathroom Due to the strong increases in...
www.expatsba.com
I did. I'm still waiting on the deed which could take 6 months or more (since not all the units have been sold yet), so not completely in the clear quite yet, but so far so good.
Lots of great advice here and the most important is lining up all the paperwork and signatures (from the seller, escribano, developer etc) BEFORE wiring or sending money and having questions answered to the point you're comfortable. Also working with a trusted broker who has plenty of experience helped. So far everything looks legit but until I receive the actual deed I won't know for certain.
Congrats on closing on your property! The title deed takes time to get. You should be able to use the copy of the deed for anything you need to do like set up utilities.
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