A donation is the transfer of a property without exchanging money, that is, free of charge. When it is a "real property" such as a house, building, apartment or farm, it is obligatory to do it by means of a deed. This deed must be signed by both parties: the donor and the recipient. If either of the parties is outside of Puerto Rico, it is possible to carry out the transaction with us.

The deed is a legal size paper document, prepared by a notary attorney, in which all the clauses required by law are included. The deed is more complete than a simple affidavit. On the other hand, if the transaction involves any exchange of money or goods, then it would be a purchase and sale.

1. Title Study

The initial step for the transfer of a real estate property is for the lawyer to verify the title in the Land Registry. This can be done through what is called a "title search", a document that is generally prepared by a title investigator. It is important to emphasize that only those persons who are already registered will be able to transfer the property.

If one of the owners is deceased, then the property must have been transferred to the heirs beforehand, which can take several months. For more information on this matter, please go to our link on Transfer of Inheritance.

The title search will also show any encumbrances on the property, such as a mortgage. If the mortgage has been paid off, it is important that prior to the donation what is known as the Cancellation of Mortgage has been carried out and registered in the Property Registry.

2. Treasury Department

In the case of Donations, it is mandatory for the attorney to process a Form of Donations before the Puerto Rico Treasury Department. This is done to verify that no taxes are owed to the government of Puerto Rico prior to the donation. In addition, at the end of the donation, the attorney must submit to the Treasury Department what is known as the "Form Informative on Transfer of Real Estate".

3. Property Registry

All transfers of real estate must be filed with the Property Registry. This process is carried out by the lawyer and involves the payment of a fee which is calculated on the basis of the market value of the property. In order to calculate this amount, the parties must inform the lawyer of the estimated value of the property, which in our case can be indicated in the form at the bottom of this page.

4. Transfer to CRIM

As part of the process, it is necessary to submit the Change of Ownership form at the Municipal Revenue Collection Center (CRIM). In our law firm, this obligation is performed by the same attorney.

In addition, if the recipient of the donation will live in the property as if it were his or her principal residence, the Tax Exemption Application must also be submitted.

5. Other

If the purchaser will live in the property as his or her primary residence, he or she can take advantage of adding Homeowners Insurance protection at once.

Conclusion

The transfer of a real estate property is a matter that tends to be tedious due to the importance it entails. However, at Abogado Notario Online we take care of the whole process in the most comfortable and easy way. To get an estimate, please fill in the contact form below.