The Closing Process in Brazil
Intrumento/Compromisso Particular de Venda e Compra
It all starts when seller signs a purchase and sale contract, known in Brazil as the “Intrumento/Compromisso Particular de Venda e Compra. Although, the agreement is the first step, purchase and sale agreement is very important, as its contents will serve as the guidelines of the entire transaction. Therefore, is fundamental that you know and understand all of your rights and obligations under it. Upon execution of it, buyer usually pays a deposit in order to show good faith and to finalize the execution of the binding purchase and sale contract. In Brazil, buyer usually pays seller directly, as there are no escrow accounts, nonetheless, it has become very frequent the use of international escrow accounts, which brings more security to all parties, but in this case seller must consent in writing.
Real Estate Company or Realtor or Seller or Attorney begins the acquisition of the title documents
Each property has a series of documents recorded at the local courthouses and registries that reflect prior owners, lenders and other parties who have or had an interest in the property you’re buying. Such documents also show any pending lawsuits and liens against the property and/or seller. The examination of such documentation is very important and shall be done by a third party who has no interest in the conclusion of the transaction.
The property is inspected
In most cases, a professional inspector shall conduct a property inspection or survey to ensure the integrity of the property.
Usually a notary or an attorney, in conjunction or not, shall prepare this document, which will later convey the property rights to the new owner. It also shows the legal description of the property, sale’s price, and all costs/fees that will be paid at closing.
You close on your property
On closing you’ll need to provide all the funds, a picture ID, and your Tax Id Card, know in Brazil as the CPF. During the closing, you (and whoever else is buying/selling the property with you) will have sign an “Escritura Publica de Venda e Compra” before a notary, and once payment is made and “escritura is executed, the closing process ends, but not the entire process of acquiring real estate.
Registration of “Escritura”
Property rights in Brazil are 100% enforceable only when the “escritura” is duly registered, so make sure your attorney or notary registers the “escritura”, as soon as possible at the proper Real Estate Registry, only when this step is completed is that you become the official known owner of the property you paid for.