We still have some things to take care of before leaving on Saturday, but we are pretty much ready to go. One thing we are waiting on, though, is the number. What number? Well, the amount we need to get a cashier’s check for to close on the property in Rincon. Thankfully we were able to avoid getting a mortgage or going through a Puerto Rican bank (through savings, a 401(k) loan and another small short-term loan), but this is still all new territory for us.
Not much time left!
We’ve bought houses in Colorado before, as you know from our rentals, with both mortgages and without. But never in Puerto Rico. I can say without a doubt that buying a house (at least in Colorado) without a mortgage is the way to go, as long as you have all the legal things done, the title is good, etc. I think we have a great lawyer working for us there in PR, and so far everything in his research is coming through fine. The problem, he said, is that he doesn’t know and will have to do a little more investigation into how much exactly the sellers need to pay on the taxes. Puerto Rico has recently changed the tax law regarding property taxes including this new Puerto Rico tax incentive (Impulso a la Vivienda) that will make it so we probably won’t have to pay any property taxes at least for 5 years! But it does complicate things, apparently.
So anyhow, we are getting a little anxious to go to the bank and take care of this. We don’t want our bank to put a hold or anything on the cashier’s check -which I don’t think they would since it’s our money in their bank! But still…I like to have everything all lined up and this waiting to the last minute thing is getting me nervous!
If it gets too close (since we only have one more business day left), then worst case scenario, we’ll just get the cashier’s check for the amount we agreed to pay minus the earnest money and pay any other closing fees that are our responsibility with a regular check.
This song from Mecano reminds me of this waiting and countdown. It’s about the new year, but to me, this Puerto Rico goal represents a whole new chapter in our life that’s about to open up!
Yes – there are all kinds of incentives until June 30th – closing costs shouldn’t affect you since your loan isn’t here but you should save I think 50% on the stamps. You will be exempt from property taxes for 5 years (they aren’t much anyway) and exempt from capital gains if you sell it in 10 years (hefty savings here if you sell it for more – ie you fix it up and sell it). Don’t know if the tax exemption applies if you don’t live in it. Probably certain special papers and stamps have to get filed to make those things happen. Google “housing incentives puerto rico” and Banco popular has a good english summary. We are speeding along toward this deadline too! They will put a hold on any check coming here but there isn’t a way around that. I hope they hand you the keys before the check clears! I don’t know if you can get real money out of the ATH (ATM) for additional fees rather than a personal check – you WILL have trouble with that for sure (it is a cash economy here and no one writes checks). We had to wait a few weeks for access to our Charles Scwhab $ and there is a Scwab office in San Juan! Maybe your bank can directly wire the $ into the account of the seller? This might work better than a check (I smell trouble). Ask David and your bank about this. Yeah – your bank should be able to directly wire money into their account…that may be the best solution. Keep us posted!
Yah this is really funky. A cashier’s check should be as good as cash as they take the money out of the account when you have the bank write the check. For the other costs, maybe we’ll just bring cash? It shouldn’t be much, and actually I think there are more costs to the sellers than the buyers to switch it over to our names in the registry.
Puerto Rico does things so weird. Britton told the real estate agent about our plans to just bring the cashier’s check for the amount of the balance and he told him to bring THREE checks! One for him (the agent), and two to pay each of the sellers individually. Plus, we need to pay David (or do the sellers??) Here we just bring one big check and they split it out amongst themselves. Very strange…I wish David could get us the final cost so they can adjust the amount including what will be charged to the sellers. I suppose the sellers could just pay David?? Or?
The wire transfer would be easier (maybe?) but that is not what the contract specifies or what the real estate agent wants…We paid the deposit/earnest money with a check and that went through, so hopefully all goes well.
I’m getting very confused. 🙂
Hmmm- bring checks, an ATM card (for cash), have a bank contact (in case things get muddled). Title transfer is a seller fee that is waived 100% as an incentive. I think you pay David since this isn’t a bank deal – he represents you for the title search, filing all the papers with Hacienda/Crim etc. – unless the agent is doing some of that. Do what they tell you to do but try to be prepared for what you can’t prepare for! Ha! Like having a water bill to buy a car – I loved that one! Some shit you just can’t anticipate. It does however all work out in some convoluted, mysterious way. Just bring a lucky chicken foot or something!
David had supplied the portion we pay and the portion the sellers pay (according to the law) a while back. I think I may just end up using that quote and send it to the Realtor.
I think it will work out fine. Just one of those last minute things to stress about! 🙂