Payment method

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Are you going to make a cash purchase or are you going to take out a mortgage?

 

So, a purchase without a mortgage will be made by means of an international transfer or a check in the in-trust account of the lawyer you have chosen and who will carry out the sale transaction.

 

You can also apply for a mortgage loan for your purchase in the Dominican Republic. We advise you to do business with Scotiabank, which has several branches in the DR, including one in Cabarete, for several reasons.

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First, it is easy and quickly accessible to get a mortgage loan from this bank for Canadian and American citizens. Secondly, Scotiabank offers better interest rates, around 5-6%, than other local banks, which are around 7-10% for up to 25 years. The bank will finance up to 70% of the value of the property. Therefore, a down payment of 30% is required in this case. Of course, the bank will bring in its appraiser to determine the value of the property in view. It is based on various factors such as the year of construction, the size of the land, the square feet of the house, the sector, number of bedrooms, the quality of materials, etc. The value that will be taken into account will be the amount the lower of the value estimated by the appraiser and the purchase price. Generally, there is not much difference.

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Procedures with the bank can be initiated in your country of origin. They will ask you for the following documents

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- Your last 2 tax returns

- A copy of your passport and other identity documents

- A reference from your bank

- Letter from your employer if you are employed

- There will also be an online form to fill out.

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You can send all the documents by email and you will have a response from the bank between 1 to 2 weeks on whether you qualify.

 

Determine your sector

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The real estate market in the Dominican Republic, particularly the North Coast, Puerto Plata, Sosua, Cabarete, Cabrera, Las Terrenas up to Punta Cana, is constantly evolving and doing very well. The country is experiencing rapid economic growth. Significant price increases are expected, so now is more than ever the time to invest. The enthusiasm for this popular sun destination is remarkable and tourism is flourishing. The country enjoys an enriching cultural life, landscapes, magnificent beaches, water sports and multiple outdoor activities. The cost of living and real estate are reasonable, compared to several other islands in the Caribbean or Florida, while being easily accessible by plane. Once you have determined your area, we will work together to choose and find your dream home. The chosen house, we will make an offer to purchase on it.

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Make an offer to purchase

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It is normal in the Dominican Republic for a 10% deposit to be requested when signing a promise to purchase. You will need to choose a lawyer who will carry out all the necessary checks on the titles and certifications on the property. This step is very important and should not be overlooked. We can provide you with references of competent lawyers who will conclude the transaction with you. Closing costs with lawyers are around 1%. On the offer to purchase, all the terms of the agreement will be written such as your contact details (seller and buyer), the price, the closing date, terms of payment, legal description of the property, the obligation for the seller to sign the deed of sale following payment, etc.

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Within approximately 6 months of purchase, payment of a tax must be paid for the registration of titles which is equivalent to approximately 2% of the lower of the amount between the price paid and the value registered to the government.

Signature of the deed of sale

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The deed of sale can be signed between 30 and 60 days. All funds needed to pay for the property in full must be in the solicitor's trust account at least 3 days prior to the signing of the deed of sale. The sale will be registered by your lawyer in the real estate register and it takes on average 1 to 2 months before receiving your titles.

 

The signing of the deed of sale can be done remotely from your country by having previously given a power of attorney to your lawyer.

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Taxes to be paid In terms of annual taxes, a property tax is levied annually, which is equivalent to approximately 1% of the value estimated by the government on properties valued at 7,138,000 Dominican pesos (147,000 USD) for property holders. properties 65 years and under.

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