Title insurance is a resource commonly available and used in the United States, it is, however, not well-known in Costa Rica.

Title insurance basically protects real estate owners and lenders against any property loss or damage they might experience because of liens or defects in the title to the property; in other words it protects against events that occurred in the past of the real estate property and the previous owner (s).

When you are investing in real estate in a foreign country the possibility of getting scammed is a big concern, and this is where title insurance comes in handy, since it protects the investor from fraud, forgery, liens, easements, encroachments, etc.

This is a relatively new concept in Costa Rica, but there are a few US companies which provide title insurance, this is optional and hardly ever used by locals since checking the status of a property is relatively easy by going through the country’s public registry.

Stewart Title Costa Rica is currently the most renowned company to provide title insurance policies in Costa Rica; they charger a one-time fee of around 0.5%. According to the Steward Title website the risks covered include: “Invalid documents executed under expired/non-existent power; false assumption of identity concerning the legitimate property owner; liens and financial burdens charged to the previous property owner; non registered property easements and hidden heirs of previous property owners; this service includes the investigation of the title prior to issuance of the title guaranty.

In the event that you face any problems with the property purchased the company will pay the valid claims up to the face value of the guaranty and the legal expenses to defend a guaranteed title.

If you are purchasing your real estate property from a professional and reliable developer and if you have a good real estate attorney, your investment should be safe, however for some additional peace of mind it doesn’t hurt to have title insurance.