How does the Buying/Selling process work in Panama?

The first step in purchasing a property is to submit an offer on the property of your choice. This offer, known as the 'Offer to Purchase a Property Agreement,' is a crucial document. It outlines all the terms and conditions governing the property purchase and eventually forms part of the 'Promise to Purchase/Sell Agreement.' Your Real Estate agency will prepare this document and send it to the Seller for their signature.

Once the Buyer and Seller have signed the 'Offer to Purchase a Property Agreement,' the real estate office's attorney will step in. They will create a legal agreement called the 'Promise to Purchase/Sale Agreement,' which formalizes the transaction. To secure the deal, the Buyer must deposit 10% of the selling price into the office attorney's escrow account.

After the deposit is received in the office attorney's escrow bank account, the Buyer will have a period of 7 to 14 days (which is negotiable) to conduct due diligence by verifying all the property/corporation information stated in the "Promise to Purchase/Sell Agreement." The Buyer can seek the help of their lawyer in this matter. In case the due diligence doesn't clear, the deposit amount will be returned to the Buyer.

Once the Buyer completes his due diligence, he will transfer the remaining balance to the office attorney's bank escrow account. The attorney will prepare the Deeds Transfer Contract upon receipt of the balance.

If you are traveling to Panama and intend to make an offer on a property while in Panama, it is essential to meet with your home banker before leaving home to ensure that you have everything in place to initiate an international wire transfer. This is important because the "Promise to Purchase/Sell Agreement" will take effect after receiving your deposit in the office attorney's escrow account in Panama.

If you are outside the country, almost all documents, contracts, agreements, and powers of attorney can be certified or signed virtually using different communication platforms. However, it is best to sign the transfer of a property registered in the National Registry of Panama before a notary at the Panamanian consulate or embassy. You can also pay by certified or cashier's check from a bank licensed to operate in Panama to the Seller's order, which will be handed out at the signature of the binding agreement for the final payment.

Our office attorney speaks English and Spanish. He will explain the Buying/Selling process in detail. He also holds a degree in Real Estate.

If you choose to have your lawyer check the transaction process, we will send a copy of all documents involved in the Purchase/Sale process for his review and comments.

Note: Please consult your attorney for the latest legal updates or any changes to the information provided in this article.

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