The mistakes that cost the most
A final checklist to run through before raising your hand at an auction.
Last lesson, and the most practical. These are the mistakes that cost the most at a judicial auction. None of them requires a law degree to avoid: only the willingness not to rush.
1. Confusing the base with market value
The base comes from the mortgage deed or an appraisal, not from what the asset is worth today. It can sit well below market, or above it. Look for comparables yourself before getting excited about the discount.
2. Skipping the registry check
Fifteen free minutes at the Registro Nacional tell you whether the whole property or only a share is being sold, how many liens exist and what rank the enforcing one holds. It is the best effort-to-risk ratio in the whole process.
3. Ignoring the “subject to prior liens” line
If the auction is not free of liens, the earlier debt stays attached to the property and becomes yours. That single line can double the real price.
4. Forgetting municipal and condominium debts
They appear neither in the notice nor in the Registry, and they travel with the property. Two calls (the municipality and the condominium administrator) avoid millions in surprises.
5. Assuming the house is empty
Winning the auction evicts nobody. Placement in possession exists, but it is a separate proceeding with its own timings and costs. Budget for it before you bid.
6. Bringing the deposit in the wrong form
Cash, a bank deposit slip payable to the court, a certified cheque from a Costa Rican bank, or an authorised technological mechanism. An ordinary cheque does not count. Confirm with the court the day before.
7. Turning up to the third round with 50%
In the third round you must deposit the full amount of your bid, not 50% of the base. It is the most expensive misunderstanding of them all.
8. Not having the balance ready by the third day
Miss the deadline and the auction is void: you lose the whole deposit, 30% as fixed damages and the rest credited against the claim. No refund, no extension, no “the bank approves it tomorrow”.
9. Overbidding in the heat of the moment
The improvement dynamic is built to make you go “just a little more”. Write your ceiling down before walking in and stick to it. There is always another auction.
10. Not lining up a notary or lawyer from the start
Someone has to formalise the deed, calculate taxes and stamps and, if needed, pursue delivery. Quoting it before you bid turns all those numbers into a budget instead of a surprise.
With those ten boxes ticked you are no longer gambling: you are investing with information. Which is exactly the point of this guide.
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