Purchasing a Used 4×4 in Costa Rica

[xspire1]

I am moving my family to Costa Rica and I am interested in purchasing a used Toyota Landcruiser Hardtop soon after we arrive. I have established a Costa Rican Corporation in which to purchase the vehicle. I am wondering what the protocol is for purchasing a used vehicle from a private individual. I have been told that it is best to buy vehicles in San Jose as often the 4×4 vehicles have been driven primarily on pavement and are in better condition as a result.

Is it reasonable to request that a vehicle be taken to a shop to have a mechanical inspection before the purchase?

Is it reasonable to pay the vendor a deposit to hold the vehicle prior to advancing all of the funds for the purchase, and if so, how much is reasonable?

How is the transfer tax calculated, how is it handled, and where and when is it paid?

Is it expected that the price of the vehicle will be negotiated?

How does one go about checking for vehicle liens or encumbrances?

Where does a preson obtain insurance?

How long does it typically take to purchase a vehicle, have the vehicle transferred, and obtain insurance? Can this be done in a couple of days?

Any other advice would be greatly appreciated.

Thanks in advance for your assistance.

Gerry

[DavidCMurray]

One major pitfall to avoid is to be absolutely certain that you are purchasing the vehicle directly from the actual owner. Your attorney can research the vehicle in the National Registry to determine ownership, liens, unpaid fines, etc.

A common scam is for someone to show you a power of attorney from the owner giving the party with whom you are dealing the authority to sell it. The problem is that the power of attorney may not be legitimate. They guy you’re dealing with may not actually have the authority to sell it. So deal only with the owner.

All terms are negotiable.

The annual “marchamo”, which is paid in December, includes a list of taxes imposed on each vehicle and the legally mandated public liability insurance. The problem is that the limits are laughably low. Additional insurance is not required; however, if you want higher liability limits, property damage coverage, theft and collision coverage, those are obtained from the national insurance monopoly — INS.

There are many who would argue that registering a vehicle in the name of a corporation is not necessary. They’re probably right. Just don’t put it in a corporation that owns anything else such as your real estate.

[xspire1]

Thanks for your advice, David.

Gerry

[Charlie]

Someone else on this site , you’ll have to search, commented on searching the pin # of the vehicle online, if the vehicle originated from the US, to determine the mileage when it was sold and transported to CR. The story goes on to say that many dealers turn back the mileage on their cars.

[Andrew]

Please see ‘Do NOT Buy A Used Car In Costa Rica Without Reading This Report. Your life may depend on it.’ at

We will also be publishing an ‘explosive’ article tomorrow entitled ‘Costa Rica Cars – To bring or not to bring. The first in a series revealing the inside scoop on the question of whether to ship your car or buy one in Costa Rica’

Scott Oliver – Founder
WeLoveCostaRica.com

[xspire1]

Thanks Charlie. I am familiar with the article you referenced.

Gerry

[xspire1]

Thanks Scott.

Gerry

[mediatica]

*Scott said it would be OK to post my car for sale on this thread*. It’s a 2006 Nissan Xterra (from the states) that I shipped to CR. It’s a 4×4, automatic, AC, 6 CD changer, tint, alloy wheels, new all-terrain tires V6 off road edition, 23k miles. Great condition, one owner (me). Great car with many upgrades. Asking $29,000 OBO. If interested, please email me privately: Becky at mediatica26@yahoo.com

[genincr]

Another car for sale (Scott will agree to post on this thread): 2006 Hyunday Santa Fe, 4×4 diesel, full extras, 18k miles. Great car, if interested, please email me privately.

[fijate]

Here are some answers to the specific questions, for the curious:

Is it reasonable to request that a vehicle be taken to a shop to have a mechanical inspection before the purchase?
This is reasonable, but it probably has to be a mechanic near to where you test drive the car. In the case of a dealer the car might not have tags, and in the case of a private owner the owner won’t have time to go with you and probably won’t want you to take it on your own.

Is it reasonable to pay the vendor a deposit to hold the vehicle prior to advancing all of the funds for the purchase, and if so, how much is reasonable? $200 can hold a car for 15 days at most used car dealers. A private party would want more earnest money and a shorter time frame.

How is the transfer tax calculated, how is it handled, and where and when is it paid?
3.5% of the fiscal value of the car, this includes the lawyer’s fees. You pay it when you sign the documents.

Is it expected that the price of the vehicle will be negotiated?
Not too much room for negotiation, when you are buying a popular make and model. In the case of a dealer, they know the exact market value of the car and have inventory that moves quickly. If you don’t buy it today, someone else will buy it tomorrow or in few days. They are more likely to throw in an extra like a luggage rack or new battery than to drop the price. Often you can ask them to include the transfer fees in their price.

In the case of a private owner, they have probably figured on dropping the price a little, since most people will ask for something off. But we are talking about 50,000 colones or so in most cases. Although this can change if the car needs specific work done. You can normally find out what the part or work will cost and get that amount reduced from the price – if it’s reasonable.

How does one go about checking for vehicle liens or encumbrances?
http://www.registronacional.go.cr/ (Click on the “consultas” button, then look for bienes inmuebles)

Where does a person obtain insurance?
The agent will come to you, either at the dealer or your residence. Most dealers have agents with offices close by if you don’t already have your own agent.

How long does it typically take to purchase a vehicle, have the vehicle transferred, and obtain insurance? Can this be done in a couple of days?
When the car has a permanent plate already you can drive it away from the lawyer’s office. So it is possible to go out looking in the morning and have your car before lunch, if you are organized.
When the car is coming to Costa Rica for the first time, you can do it in 2 days in most cases. You find the car and pay for it the first day, then the dealer takes it through the RTV inspection and gets the temporary tags for you. So you normally pick it up the next day, although during the week sometimes you can pay for the car in the morning and pick it up in the afternoon.

[dayleslie]

I just read both articles, very interesting. We are considering shipping a 1996 Dodge grand caravan to Costa Rica. We have been advised against this, do you have an opinion? Would parts be available for this type of vehicle? we are aware that import costs are about $3,000, which isn’t so bad considering to buy a similar car looks like it will be around $8,000. Thanks,

[fijate]

I would stay away from shipping a Dodge Caravan here. Parts and mechanics will be hard to come by and/or expensive.

[tx500sl]

Hi Gerry,

When you say Toyota Landcruiser Hardtop, I think you are writing about a very old vehicle, not the modern Landcruisers we see roaming the streets of Escazu in great numbers. If this is the case, I think that you have some excellent advice in the previous posts.

If you are talking about a modern Landcruiser, however, there are only two ways to make sure that you are getting the best vehicle for your money. 1.) Buy one before you come, use all the standard precautions you would use when buying any vehicle, then ship it here with a reputable company (I recommend Ship Costa Rica). 2.) Buy a fresh North American import here with a CarFax or AutoCheck report confirming the odometer and title history.

As previously noted in this thread and supported by articles in this publication, used vehicles here are a gamble unlike anything you have ever experienced. Odometer tampering and the absence of prior damage disclosure are the norm here. Vehicles purchased new in Costa Rica, although they look the same as the North American models, are not the same. The safety standards are not the same. The equipment offerings are not the same. Used Tico vehicles have spent their entire lives on Tico roads, so the wear and tear per mile/kilometer is far greater here than in North America.

I spent 29 years as a salesman, used car department manager and independent car dealer in the USA. I thought I had seen everything until I came to Costa Rica. The lack of consumer protection laws results in a very dangerous car buying environment.

If anyone would like my input before purchasing a vehicle here, I’ll be happy to offer free advice. You can write to me at ken@discountplasticbags.com.

[xspire1]

Thanks so much for your detailed reply – it was very helpful. I purchased a Toyota Lancruiser Hardtop privately, after checking it out thoroughly, and am very happy with the vehicle. It was relatively easy to accomplish with the assistance of a lawyer and I would not hesitate to do it again.

Regards

Gerry

[xspire1]

Thanks for the advice, Ken.

Gerry

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