Avoid investment in Costa Rica without giving your money to a thief
by Ivo Henfling for the Easy Times
I write blogs about Costa Rica real estate and investing in Costa Rica all the time but I have never written one that explains about making an investment in Costa Rica without giving your money to a thief or a scammer. Do your homework before you put your money in Costa Rica real estate or any investment company in Costa Rica who offers great returns on your investment (ROI).
We all know the expression “when it sounds too good to be true, it probably is”. Costa Rica is paradise, but it stops being that as soon as your investment turns sour. I would like you to see this blog as a general warning to make sure you do the right thing before you make any investment in Costa Rica.
I love to read novels when I can find the time to do so, and in many books the thieves or terrorists will disappear with the millions to Costa Rica. Of course we get our share of thieves and scammers, but Costa Rica is not some kind of cave where the bad guys can hide easily and money laundering laws and bank regulations make it even more difficult.
You will find lots of nice people who will start a conversation with you in a coffee shop, a bar or a restaurant and before you know it you will have made a new friend. It is not unusual to receive a great offer on this great deal that you should move on quick. For an obvious reason, you will feel more comfortable to move on a deal that is offered by someone who speaks the same language as you do. If the offering party is a Spanish spoken person, you would think about it twice, am I right?
When you get this deal offered that sounds too good to be true, be careful and do not believe what they tell you until you do your due diligence and hire a good attorney to help you in this before you purchase or invest.
In my 30 something years of living in Costa Rica, I’ve seen my share of scams. When my dad made his first investment in a local factory, he later found out his partner used the money needed to invest in the company to put a new roof on his house. Years ago, when I owned a spice packing plant in Escazu, I’ve seen companies selling shares or parcels in pepper plantations offering huge profits. When that all went down the drain, the macadamia plantations was the new hype. After that, it was teak investment all over. There are quite a few investors in Europe who lost their money in teak because the owners of the investment company disappeared, here is a good example of that.
You’ll find that most of these investment schemes (or scams) will offer their deal to small investors who don’t have the financial capability for a lawsuit when the investors disappear and the Costarican law doesn’t know class action, of which the scammers take advantage. For many years, back in the 90’s, we had clients who rented mansions instead of buying a home in Costa Rica because The Villalobos Brothers paid 5% interest per month (yes, per month !) and they were shut down by the Costarican government.
I have also seen my fair share of Costa Rica real estate and land scams that looked beautiful in the photos and websites but did not go any further because the developers disappeared before anybody could file a claim. Costa Rica real estate developments that advertise the best ocean views at bargain prices, or a development offering “buy now before the marina is built” or “purchase NOW before the airport is built” are the ones you need to have a careful look at. Before you invest in a promising development that only exists on paper, spend some time on doing our Developer Quiz.
Costa Rica is a beautiful country and a great place to live. But like in any other place on earth, there are always people out to make an easy buck. Be smart and investigate who you are doing business with so you can save yourself the headaches and the money problems. Please learn from these samples I showed above. Investing in Costa Rica real estate is a very interesting option that you should look at with the right people. And I mean those that give you the possibility to give you the right ROI and to secure your money.
Avoid making an investment in Costa Rica without giving your money to a thief, contact our American European real estate affiliate agents, contact us now.
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I DO want to remind our readers that we appreciate any referrals you can send us. I know you all meet people on the plane, in the supermarket, at yoga, at the gym, at the beach or in a restaurant. Please remember the American European real estate Group’s agents when you talk about your home in Costa Rica when you meet someone who wants to purchase one, we appreciate it.