Verify the property background at the Property Registry
Agency: Property Registry (Instituto de la Propiedad)
The buyer can verify the property background on the SURE online site (Unified Registry System) http://sure.sinap.hn/compartido/ at no cost. SURE provides all information required before drafting the public deed, including the legal provisions of the property as well as the current and previous owners. Users also have the option of obtaining a paper copy of the property background at the Instituto de la Propiedad in 24 hours. The integral certification (certificacion integral) and the non-encumbrances certificate (certificado de libertad de gravamenes) cost HNL 300 and HNL 200 respectively.
Time and cost: Less than one day (online), no charge
Obtain a taxes clearance from the Municipal Cadaster
Agency : Municipal Cadaster (Dirección General de Catastro y Geografía – Alcaldia Municipal)
Even if it’s not required by law, it’s a common practice to verify at the Municipal Cadaster if the seller is the registered owner and if all municipal taxes have been paid. The parties would need to provide the municipal tax number of the property for performing this verification at no cost. It’s also possible to request a cadastral location certificate (constancia catastral de ubicacion) for HLN 200 (which is optional).
Time and cost: 2 days, no charge
The notary drafts the public deed
Agency: Notary
After obtaining all the due diligence documents, the notary drafts the deed (“escritura matriz”). Notary’s fees are established by mutual negotiation between the parties and are calculated according to the market value of the property. Regulation No. 001-2018 sets the minimum tariffs for general notarial services in HNL 3.000, and art. 15 of the same regulation establishes that for agreements with a value between HNL 500.000 and HNL 5.000.000, the rate cannot be below 2% of the property value. In practice, notaries charge between 3% and 5% of the property value.
Time and cost: 2 days, HNL 111,321.86 (between 3% and 5% of property value (Notary’s fees))
Pay the transfer tax at the Commercial Bank
Agency: Commercial Bank
The transfer tax (1.5% of the property value, for an urban property with improvements) must be paid at a bank. The taxes are calculated based on either the official value of the property (determined by the Cadastre for tax purposes) or the market value, whichever is higher. With the introduction of the Property Law in 2004, the transfer tax was cut from 3% to 1.5%, the registration rights and the stamps were eliminated.
Time and cost: 1 day, HNL 41,745.7 (1.5% of property value (Transfer Tax))
Register the public deed at the Property Registry
Agency: Property registry (Instituto de la Propiedad)
The new deed must be registered in the Property Registry (Instituto de la Propiedad) by the notary. However, the notary might waive this right and leave to the responsibility of the applicants. Registration fees are HNL 200 for the first HNL 1,000 of the property value, and HNL 1.50 for each additional HNL 1,000 according to Art. 1 of Diario la Gaceta published in October 2010.
The following documents should be presented at the moment of registration:
- Public deed
- Proof of payment of the registration fees
- Proof of payment of the transfer tax
- Proof of payment of the capital gain tax
Time and cost: 21 days, HNL 4,374.5 (HNL 200 for the first HNL 1,000 of the property value, and HNL 1.50 for each additional HNL 1,000)
Notify the change of ownership at the Municipal Cadaster
Agency: Municipal Cadaster (Dirección General de Catastro y Geografía – Alcaldia Municipal)
The change of ownership must be registered at the Municipal Cadaster (Dirección General de Catastro y Geografía) by the notary or the buyer presenting the deed duly recorded in Procedure 5. This procedure is commonly done in practice since the cadaster at the property registry, and the cadaster at the municipality are not linked, and the municipality requires the update of ownership for taxes purposes.
Time and cost: 2 days, HNL 250
