I am Brazilian (permanent resident in the US) - my Husband is American
We are negotiating the purchase of a coffee plantation in MG.
I've already obtained an attourney in Brasil. All the documentation is cleared.
My question is about the money transaction.
How does that work? We are ready to pay and I want to sign
the "escritura" and everything on the 15th of June.
Can you give me instructons or directions on how this is done?
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Well, there are no escrow accounts in Brazil... This sort of complicates real estate transactions. When you make the final payment (if you lawyer is good, he can structure the deal where you can safely make the wire directly to the seller´s account) you better be sure that the property ans seller(s)´ documentation has been really "cleared".
You can also bring cash... and pay at closing.
In any case, you will have to clear the payment method with the seller. Better yet, have it stated in your purchase agreement. This way you won´t have to face a sudden turn-around by the seller where your payment is refused due to the change in foreign exchange rates, seller´s idea, his mood, or weather...
Boris
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"you better be sure that the property ans seller(s)´ documentation has been really "cleared".
Yes - all the documentation has been cleared and we have a pretty detailed "commitment letter"/ purchase agreement.
I guess I will ask them to add all the info in too.
But, all that has to be done is a wire transfer? doesn't the bank charge a 20% fee on this? How exactly does this work?
I have even hired a credentialed "land measurer" - topografo
that has issued a map and etc. for the place.
"You can also bring cash... and pay at closing."
I don't think I would risk that - specially entering the country
with that amount of money.
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"Yes - all the documentation has been cleared and we have a pretty detailed "commitment letter"/ purchase agreement.
I guess I will ask them to add all the info in too."
Good.
"But, all that has to be done is a wire transfer? doesn't the bank charge a 20% fee on this? How exactly does this work?"
No, the bank doesn´t charge 20%. The bank can only charge wire fee and some other expenses which do not even get near 20%. If the property is purchased in you and your husband´s name, you might be liable for taxes for the amount that corresponds to your share. It might be treated as taxable income in Brazil due to that fact that you are a Brazilian citizen and your income is taxed world-wide. But you will have to square the issue with Receita Federal at your next tax return.
If you (or someone from your family) has a bank account in Brazil, you can wire the funds there (of course, you will have to consult a good Brazilian CPA beforehand if you wish to avoid some very nasty surprises with the Receita Federal). You can wire the funds to the third-´party account and then pay the balance with a cheque administrativo.
"I have even hired a credentialed "land measurer" - topografo
that has issued a map and etc. for the place."
Good.
""You can also bring cash... and pay at closing."
I don't think I would risk that - specially entering the country
with that amount of money. "
It´s a risk allright.... there are also other risks associated with a bank wire which are just as bad or even worse then physical safety risk of bringing cash into the country ...
This message has been edited by Bluster2000 from IP address 200.165.254.72 on May 27, 2006 7:24 PM
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In addition to what Boris said, due to money laundering regulations, a transfer should obey many rules. For a wire transfer to be accepted, legal, and for the receiver’s part not get taxed (donation tax), it must be done through “Banco Central do Brasil” and the parties must produce a properly executed and registered contract for purchase and sale with a clause mentioning such transfer pursuant to the “Banco Central” rules for real estate transactions. Please be aware that Brazilian Realtors and Brokers do not know these rules, please consult with your attorney and have it written in the contract accordingly. This has also extremely importance when becomes your time to sell your property, either to purchase another one or to take your money back to your home country. If your first transfer did not follow the rules, “Banco Central” will not allow you to transfer this money back to your country, as this could be considered a felony crime named “Evasao de Divisas” and the Brazilian IRS (“Receita Federal”) would, most likely, get involved on it as well. Definitely, you don’t want that to happen.
What concerns me is the fact that the documentation was checked during a purchase and sale agreement, therefore it should be done again prior to closing to make sure nothing changed or nothing new popped up.
Good luck!!!
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"What concerns me is the fact that the documentation was checked during a purchase and sale agreement, therefore it should be done again prior to closing to make sure nothing changed or nothing new popped up."
In adition to Jose Santiago said, he is right. The documentation is valid for 30 days. If something change, may be you have problems.
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