What a Lender Does at a Loan Closing in Costa Rica

For a first-time lender, the loan closing can feel like a blur of documents and wire instructions. It does not have to. Closing is where your security is created, so it is worth knowing what happens, what to check and what to keep afterwards. This guide explains a loan closing in Costa Rica from the lender’s side.

Before closing: check that the documents match the deal

When you agreed to fund a loan, you accepted specific terms: the amount, the rate, the term, the property and the value used for loan-to-value. Before closing, compare the loan documents against those terms. Your own attorney should review the documents with you, including the mortgage that secures the loan.

• Is the amount and rate the one you agreed?
• Are the term, payment dates and maturity date clear?
• Do the documents set out the early repayment penalty and what counts as a default?
• Is the property described correctly?

Confirm the title and existing liens

On GAP loans the lender always holds first position, so any existing mortgage or lien must be paid off before or at closing. Make sure the closing includes that payoff, and that the registry information was checked close to the closing date.

Sending the funds

Ask your attorney exactly how and when funds should be sent for your closing, and whether they will be held in escrow until the documents are signed. Confirm payment instructions by phone, using a number you already have, before you send money. Escrow and trust in Costa Rica property lending explains how funds can be protected.

You fund the agreed principal. The borrower’s loan fees are deducted from the borrower’s proceeds, not from your interest, so you receive the full agreed rate.

At the loan closing in Costa Rica

An attorney and notary prepare and execute the documents, the borrower signs, any existing lien is paid off and the lender’s mortgage is presented for registration in the National Registry. A lender does not always need to be physically present; your attorney explains how your signature and funds are handled. If you are lending from abroad, see lending in Costa Rica without living here.

After closing: what to keep

• Proof of registration. Under Law 3883, the Registry’s purpose is to guarantee the security of registered rights with respect to third parties, so confirm your mortgage is registered in first position.
• Copies of the signed loan documents and the mortgage.
• The payment schedule: monthly interest, paid directly to you, with the principal due at maturity.
• Contact details for the borrower’s attorney, your attorney and GAP.

GAP’s role

GAP arranges the loan through closing. After that, borrowers pay lenders directly, and GAP can help with communication if a problem is reported. How a first-lien mortgage protects a private lender explains what your registered mortgage does for you.

Frequently Asked Questions

Do I need to attend a loan closing in Costa Rica?

Not always. Your attorney explains how signing and funding are handled for your closing.

Who pays the closing costs?

Borrowers pay the loan fees, which are deducted at closing. Lenders fund the agreed principal and receive the full agreed rate.

How do I know my mortgage is registered?

Ask your attorney for confirmation of registration in the National Registry after closing, and keep it with your records.

Who do I contact after closing?

The borrower pays you directly. If a problem comes up, GAP can help with communication; email [email protected].

This article is general information only and is not legal, financial or tax advice. Legal references summarize Costa Rican law as published in SCIJ. Private lending carries risk, and no return is guaranteed.

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