An almost bi-weekly-ish online column by MARIE MENDEL covering stories and facts on Real Estate in Nicaragua, will return.

previous columns:
Lesson 1: This might get dirty
Lesson 2: It ain't over when the fat lady signs
Lesson 3: If you're checking title, you might get the finger
Lesson 4: Take it to the bank OR X marks the spot
Lesson 5: Francisco, a fence, and a Ford I could afford

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continued from home page.

When a property is offered to you, an exhaustive process of title search is a must. It is not a secret that the purchase of properties, especially in the coastal and tourist zones of Nicaragua, involves a serious risk. In this article, we will refer only to the Land Reform Titles (Titulos de Reforma Agraria).

The process of land reform that took place in the eighties created a situation that, beyond the social intentions of the reform, created a series of undesirable situations that often seriously affects safety when purchasing real estate property.

During the first stage of the Sandinista Revolution, millions of acres were confiscated and expropriated and given to Nicaraguan farmers either individually or organized in cooperatives. In an effort to simplify the registration process for the new proprietors, the Government announced laws that allowed one to register the properties given to the beneficiaries, ignoring the background and creating a new account or number to each property, thus making it almost impossible to follow the chain of registry, that is to say, the history of the property. When this chain in unbroken it allows you to track the history of a property by tens or hundreds of years.

Add to this problem the fact that during the war against Somoza, many of Property Records Offices in Nicaragua were destroyed. It is necessary to point out that according to Nicaraguan laws, the right to recover confiscated property never [expires]. Enough reason to investigate whether the confiscated original owners were properly compensated by the government. If a person was subjected to confiscation and did not receive compensation, he is in a legal position to undertake legal actions against the present proprietors.

Another problem is the appearance of false titles of land reform used to entice investors at quite attractive prices. Recently, as a reaction to this problem, the new government ordered that any transaction made on the basis of a land reform title must have the endorsement of the Property Superintendent in Managua.

So, how can you carry out the process of acquisition of real estate while diminishing the risks? There are several answers, nevertheless, we advise basic steps that can avoid bitter moments and loss of money: 1. Ask who offers you the land for copies of all documents of property. 2. Make the title search. 3. Check with the Compensations Office (OCI) in Managua if the previous proprietor was compensated. 4. Demand from the sellers the Endorsement of Property Superintendent, which certifies that the land reform title is legitimate. 5. Demand proof of payments of property taxes. 6. Do not give money nor sign documents that commit you to buy without having reliable information.

Consider that land reform titles are not necessarily bad, only use the logic: If something seems too good to be true, it probably is.

In our next contribution we will talk about the Possession Titles (Títulos Supletorios)

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