Sending payments for your Dominican property purchase
Once you’ve decided on a property to purchase in the DR, the property has passed all the due diligence checks, and the promise to sale or agreement is in place, it’s time to start sending payments.
In the US or Canada, escrow companies are used for property purchases. However, escrow services are not used in the Dominican Republic. The seller will be in control of the funds paid towards the property.
So, how are buyers protected?
It all comes down to the promise to sale or reservation agreement. If the seller does not comply with the terms and conditions of the agreement, then you’ll have the right to take legal action against the seller.
In the DR, there are courts that specifically handle legal matters related to real estate. Legal action against a seller or developer can result in liens on the seller’s or developer’s bank accounts, meaning that their assets are essentially frozen.
While some issues may arise with developers or sellers where you’ll need to file a lawsuit, it does not happen often.
That said, lawsuits in the DR can take a long time, so you want to avoid this type of situation. The way to do this is to deal only with experienced and reputable developers with a track record. For reservations, you should always negotiate the least amount of cash to put down to reserve the unit.
It is advisable to send property payments directly to the seller’s bank account.
Sending a large transfer from your foreign bank account to your Dominican bank account and then sending it to the seller can slow down the process as you’ll have to deal with additional checks and admin with the bank. By sending payments directly to the seller, they’ll have to deal with the verifications and administration with their bank.
Maria Abreu is the CEO and Managing Attorney of Abreu & Associates, a law firm practicing exclusively in Dominican Republic Immigration and Nationality law. She is also the founder of Retire and Invest DR. This organization hosts conference events for foreigners interested in living, retiring, and investing in the DR. You can contact Maria at: firstname.lastname@example.org.