Buying a property
Important things to note:
- There are no restrictions to non-nationals purchasing a property in Barbados.
- There are some procedures regarding foreign currency being brought into the island, as well as non national mortgages. They all need to be registered with the Central Bank of Barbados.
- There are no special visas required for non-nationals.
- There is no Capital Gains Tax in Barbados. Investors are not charged for the appreciation in the value of their property.
- Register with Greenidge Real Estate Inc.:
- Our experienced agents will need as much information as possible about the type of property you are looking for and will do their very best to find your ideal home.
- Mortgage Needed:
- It is advisable to get a mortgage agreed in principle as early as possible, as this always helps to speed up your mortgage application.
- Viewings are conducted by appointment. This is of course if it is suitable to the home owner.
- Making an offer:
- Once you have found a suitable property, we will put your offer forward to the owner immediately. Any offer is subject to a contract being signed. There are no legal obligations on either side until a contract is signed and the 10% deposit paid.
- An Attorney will be required to handle the legal work involved. Should you not have a specific Attorney, Greenidge Real Estate Inc would be happy to suggest one of those which we have worked closely with over the years.
- The Sale Agreed:
- Should your offer be accepted, you will need to instruct your Attorney to proceed. At this stage we will try to agree on an exchange and completion date. This is also the time to instruct your mortgage broker to proceed with your mortgage application and make arrangements for a survey.
- Contract Draft:
- This is drawn up by the Seller’s Attorney and sent to the Purchaser’s Attorney, who will raise some preliminary enquiries and make a Land Registry search
- Contract Approval:
- When the local search and answers to the preliminary enquiries are received, the draft contract is approved by your Attorney providing there are no further enquiries.
- Formal Mortgage Offer:
- (If a mortgage application has been approved)This document will be sent to the Purchaser’s Attorney for you to sign. Once signed and returned your mortgage is in place and your ready to exchange contracts.
- Exchange of Contracts:
- The contract is signed by the Purchaser and the Seller. The deposit which is usually 10% of the purchase price is paid by the Purchaser to his Attorney, who then pays into over to the Seller’s Attorney, and the completion date is usually set at this time.
- The Completion:
- It takes approximately 12 weeks after the exchange of contracts, depending on each parties personal requirements. The balance which is usually 90% is now transferred from the Purchaser’s Attorney to the Seller’s Attorney
Your Attorney’s Role
- Once you have chosen the Attorney that will be acting on your behalf, you need to confirm with them what their fee will be. Attorney fees are usually based on the agreed price of the property.
- The next step would be to formally engage your attorney by signing and returning their engagement letter. If your are overseas, this can be done by email.
- Then you will be asked to send them the retainer fee, as well as the 10% deposit of the purchase price. If overseas.
- This can be wired to an agreed account. Note that the deposit does not get sent to the vendor until you have signed the Agreement, however, it is very helpful to your attorney as it demonstrates to the Seller that you are serious.
- The Purchaser’s Attorney then advises the Seller’s Attorney that they are representing you. The Seller’s Attorney will then send the standard Agreement and copies of the title deeds for the Purchaser’s Attorney to review to insure proper historical ownership of the property.
- A date of completion is then agreed upon with the Seller. It is very important that you ensure that this date gives you enough time to receive money that you may be borrowing.
- The Agreement will then be sent to you by courier and you have to sign it in the presence of a Notary Public and return it to your Attorney.
- When the Purchaser’s Attorney receives this Agreement, after being signed by the Purchaser, it will be forwarded to the Seller’s Attorney together with the 10 % deposit.
- Various procedures take place to make sure that there are not mortgages or other liens on the property.
- Arrangements are then made to have the boundaries of the property officially pointed out to you or your agent.
- The balance of the Purchaser must then send the balance of the purchase money to his Attorney at least 3 weeks prior the agreed date for completion.
Cost Incurred by the Purchaser
There is no Property Transfer Tax for buyers. Buyers Legal Fees – Approx. 1% to 2.5% of the purchase price(plus 17.5% VAT). Local Mortgage Down Payment – Usually a minimum of 10%.
Local Mortgage Repayment Time – Up to 30 Years or until the borrower reaches 65 years of age.
Non-National mortgage Down Payment – Usually between 30 to 50%
Non-National Mortgage Repayment Time – A maximum of 15 years and must be approved by an offshore financial institution.
Mortgage Commitment Fee and Negotiation Fee – Ranges from 0.5% to 3%.
Life Insurance – Required if you need a mortgage.
Annual Property Insurance – 0.4% for a residence, 0.6% for commercial and 0.9% for hotels. Other things such as location, value and use of the property can affect these rates.