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In this article, we will indicate the specific steps to buy a Home/Property/Lot in Colombia and the correct legalization of the currencies to obtain a type M Investment Visa (Property Owner) with a value greater than or equal to 350 SMMLV (~$113,750 USD) or type M investment Visa (foreign direct investment) 650 SMMLV (~$211,250 USD) according to the regulations of the Colombian Ministry of Foreign Affairs.
Before October 2022, applying for a Resident Visa was possible after investing more than 650 SMMLV. However, regardless of the investment, foreigners will have to accumulate 5 years with a Type M visa before applying to become a permanent resident.
*The exchange rate used was 4000 COP per USD
What are the steps for the legal purchase of a Property in Colombia?
The first step to buying a property in Colombia is to establish a clear negotiation of the property to buy, verifying various legal issues of the property before making the purchase that we indicate below:
Titles Inquiry of the Property
The Titles Inquiry (Estudio de Títulos) verifies the property's legal history by analyzing the Tradition and Freedom Certificate (Certificado de Tradición y Libertad) of the property to buy, among other public documents.
In the Preliminary Study, the attorney reviews the Certificado de Tradición y Libertad to validate if it has affectations, encumbrances, domain limitations, resolution conditions, preventive measures, etc.
After that, in the Definitive Legal Study, professionals can review deeds, offices, judgments, and others to verify the ability of people in the property titling chain, that there are, among others, false traditions, huge injuries, sale of something else, hidden defects, resolution conditions, etc. Review space and boundaries and, finally, support in the writing process.
What is the information you obtain in the Certificate of Tradición y Libertad?
The Certificate of Tradición y Libertad provides a detailed property description, including its land boundaries, total built area, location, and nomenclature. It also contains property registration information, which offers a unique identification number in Colombia.
Additionally, the certificate includes annotations that provide a history of purchases and sales. This history details the respective deeds from notaries and the values associated with each transaction.
Preparation of a Purchase and Sell Promise
With the Purchase and Sell Promise (Promesa de Compraventa) document, the completion of the business is guaranteed, containing clauses that allow the collection of sums of money through the criminal clause.
The document must clearly express all the characteristics of the property and the business it intends to carry out.
In addition, it is always advisable to be signed by a notary to give more formality to the process. Many times with this contract, a deposit agreement is also signed, whereas a guarantee, an advance amount of money, is agreed upon and delivered. The buyer must sign it and the seller, if in the case the buyer is not in the country, he must send an apostilled power of attorney and officially translated it into Spanish to a proxy.
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Send money to the seller and currency legalization
Once the Promesa de Compraventa has been made where the negotiation amounts and dates were agreed, the buyer must send the money on the agreed date to the seller directly from his home bank.
In this step, two important documents are carried out to obtain the Investment visa type M (Property Owner) or type M investment Visa (Foreign Direct Investment).
The seller’s Bank receives notification from the buyer’s bank to negotiate the currencies and legalize them through the declaration form to exchange F4 for property purchase. The Banco de la República Certificate is the document the Bank of the Republic issued detailing a foreign person’s investment history in Colombia. The money sent from the bank of origin to the bank account must be in the name of the foreign person and sent directly to the seller. Triangulations of cash are not allowed; the buyer cannot send the money to a local bank account in Colombia and then send it to the seller.
Certification issued by the Banco de la República is one way to obtain a visa or Colombian residency, depending on the investment amount. Foreign investment in Colombia is considered a foreign capital investment in Colombian territory, including Colombian free zones, by non-residents in Colombia.
Public Deed Preparation
This final contract is made at the notary for which you'll need:
These documents must be filed so that the notary can prepare the public deed that takes between 1 or 2 working days to call the parties to sign (this is variable, according to the notary).
Notarial Expenses and Formalization of the sale
Regarding the notarial charges, the public deed is ready. The parties must approach the notary to sign and assume the deed expenses, which are generally divided equally between the seller and the buyer. The deed expenses are 0.54% of the sale value, and another value to be paid is the withholding tax, which is 1% of the sale value.
Formalization of the sale in the Public Instruments Registry Office (Oficina de Instrumentos Públicos).
When the notary has finished the Public Deed and the two parties have signed it, he will deliver an authenticated copy to the interested parties to deliver to the Oficina de Instrumentos Públicos (you can check the offices here). This act makes the buyer the owner, who, from that moment, must assume the property’s expenses.
When registering the public deed, the buyer only owns the property in said office. From this moment on, the property sale contract will have been officially perfected. It should be clarified that the sole celebration of the promise and subsequent purchase agreement does not improve the business or generate rights or obligations on the buyer’s part regarding the negotiated property.
Application for M-Type Visa (Property Owner) or M-Type Visa (Direct Investment)
The process of applying for an Investment visa type M (Property Owner) or type M investment Visa (Foreign Direct Investment) in Colombia is carried out before the Foreign Ministry of Colombia in Bogotá and once the visa is approved, the immigration certificate is requested before Migration Colombia of the corresponding city of residence and you can obtain your cédula de extranjería.
The Cédula de Extranjería is the identification document for foreigners in the national territory issued by Migración Colombia. If in accordance to your visa, you need this document, click the button and get it through us!
The requirements for applying for an Investment visa type M (Property Owner) or Type M investment Visa (Foreign Direct Investment) are as follows:
What are the requirements to apply for an Investment Visa as a Property Owner?
Passport
Original valid passport with at least 2 blank pages.
Photo
1 digital photo 3 x 4 cm white background without accessories. Printed/physical photos are not accepted.
Health Insurance Policy
An insurance with the proper coverage required for the Government.
Public Deed
Public deed of the property duly updated and issued by the notary.
Certificate of Tradición y Libertad
The Certificate of Tradición y Libertad granted by the respective Public Instruments Registry Office issued less than one (1) month ago.
Bank Statements
Bank statements for the last 3 months.
Certificate from the Banco de la República
is the document the Bank of the Republic issued detailing a foreign person’s investment history in Colombia.
About the Banco de la República Certificate
Showing the registration of direct foreign investment for the purchase of property in the name of the foreigner requesting the visa, for an amount greater than 350 SMMLV (approximately $113,750 USD) for type M (Property Owner) or an amount greater than 650 SMMLV (approximately $211,250 USD) for type M investment Visa (Foreign Direct Investment).
Costs, Validity, and Restrictions
Application for a Foreign ID Card (Cédula de Extranjería)
Once the visa is approved, the Cédula de Extranjería must be requested on the Colombia Immigration page.
The Cédula de Extranjería is the identification document for foreigners in the national territory issued by Migración Colombia. This document is issued to foreigners holding a visa of more than 3 months and its use must be in accordance with the visa that has been authorized.
If you need to obtain your Foreign ID Card for the first time or need a duplicate due to loss, damage, or other reason, follow the steps in the guide: Cédula de extranjería: Step by step guide.
