Navigating Your Exit: An Expert's Checklist for Expats Selling Property in Ecuador

As an expat in Ecuador, the decision to sell your property marks a significant transition. As a Real Estate Broker and Lawyer practicing in Cuenca, I have managed hundreds of these transactions. My role is to move beyond generic advice and provide the authoritative, hands-on guidance necessary to protect your investment and ensure a seamless exit. This is not just about finding a buyer; it's about bulletproofing the legal and financial integrity of your sale.

Selling property here involves a legal framework with unique nuances. Overlooking a single document or deadline can derail a transaction, costing you time, money, and peace of mind. This guide outlines the critical steps from my professional perspective, focusing on the safeguards I implement for my clients.

Pre-Sale Preparations: Fortifying Your Legal Position

Before your property is ever listed, a rigorous legal audit is non-negotiable. This proactive due diligence eliminates 90% of the problems that can arise during a sale.

1. Title Deed Verification (Escritura Pública de Compraventa)

Your ownership is defined by your Public Deed of Sale, or Escritura Pública. We must confirm its integrity.

Review for Accuracy: We will scrutinize the original deed to ensure your name, passport/cédula number, and the property's legal description—boundaries (linderos), area, and registration number—are perfectly correct.
Confirm Registration: Your deed is only legally effective once it is inscribed in the local Registro de la Propiedad (Property Registry). We will verify this inscription and ensure no subsequent liens or encumbrances have been attached without your knowledge.
Property Legal Structure: In Ecuador, properties fall into two main categories:
- Independent Property (Cuerpo Cierto): A standalone house or lot.
- Horizontal Property (Propiedad Horizontal): An apartment, condominium, or a home in a gated community with a homeowners' association (HOA). Hyper-Specific Detail #1: If you are selling a propiedad horizontal, you are legally required to provide a certificate from the building administrator stating all monthly maintenance fees (alícuotas) are paid in full. A buyer's lawyer will halt the closing without this document, as outstanding HOA debt legally transfers to the new owner.

2. Clearing Municipal & Registry Encumbrances

Unpaid taxes and hidden liens are the most common deal-killers. We proactively gather these non-negotiable certificates before listing.

The Crucial 'Certificado de Gravamen': Hyper-Specific Detail #2: This is the single most important document for a buyer. Issued by the Registro de la Propiedad, the Certificate of Liens is an official title search that confirms there are no outstanding mortgages, court-ordered embargos, or legal prohibitions preventing the sale. No competent notary or buyer will proceed without a "clean" certificate dated within 30 days of the closing.
Municipal Tax Clearance: We will obtain a Certificado de No Adeudar al Municipio (Certificate of No Debt to the Municipality). This proves that your annual property taxes (impuestos prediales) are paid and that there are no outstanding debts for municipal improvements (contribuciones especiales de mejoras).
Unregistered Construction: If you've made additions or major renovations, were they registered with the municipality and added to your deed? Unregistered construction creates a major discrepancy between the legal documents and the physical property, which can stop a sale cold. We must verify the Planos Aprobados (Approved Plans) match the reality on the ground.

The Sales Process: From Handshake to Registered Deed

Once your property is legally fortified, we can proceed to the market with confidence.

1. The Offer and the "Promesa de Compraventa" (Promise to Purchase)

When an offer is accepted, we formalize it with a Promesa de Compraventa. This is a binding legal contract, not an informal agreement.

Key Terms: It locks in the sale price, payment schedule, closing date, and contingencies.
Deposit (Arras): A deposit, known as arras, is paid by the buyer upon signing. The contract must explicitly state the conditions under which this deposit is forfeited or returned. I ensure these clauses are ironclad to protect you from a non-serious buyer.

2. The "Minuta" and Final Closing at the "Notaría"

After all contingencies are met, my legal team drafts the Minuta, which is the definitive sales contract that the Notary will elevate to a public instrument.

Notary Public (Notario): In Ecuador, the Notario is a specialized lawyer who acts as a neutral public official, giving legal faith to the transaction. We will use a reputable Notaría experienced with expat transactions.
Signing the 'Escritura Pública': The closing takes place at the Notaría. Both parties sign the final Escritura Pública de Compraventa in the Notary's presence. Hyper-Specific Detail #3: Payment is almost always made via a cheque certificado (certified local bank check) handed over at the signing table. The Notary will verify the funds before proceeding. The Notary is also legally required to read the entire deed aloud to both parties before it is signed.
Final Registration: The transaction is not complete until the new Escritura is registered in the Registro de la Propiedad. This is the final step that legally transfers ownership.

Financial Safeguards: Taxes and Repatriation of Funds

Managing the financial side is critical. Misunderstanding your tax obligations can have serious consequences.

1. Tax Obligations: Understanding Alcabala and Plusvalía

Property Transfer Tax (Alcabalas): Hyper-Specific Detail #4: While the buyer is legally responsible for paying this tax, you must understand it for negotiation. In Azuay province, the Alcabala is approximately 1% of the higher of two values: the sale price or the municipal property valuation (avalúo catastral). Savvy buyers factor this cost into their offers.
Capital Gains Tax (Plusvalía): This municipal tax is the seller's responsibility. It is calculated on the profit between your original purchase price and the current sale price. Hyper-Specific Detail #5: For expats who have owned a property for less than five years, the scrutiny on the plusvalía calculation is often higher. This tax must be paid before the Notary is legally permitted to authorize the signing of the final deed. We calculate and pay this on your behalf to ensure a smooth closing.
National Income Tax (Impuesto a la Renta): Any significant profit from the sale is also considered income and may be subject to national income tax, payable to the Servicio de Rentas Internas (SRI).

2. Repatriating Your Funds

Moving your proceeds out of Ecuador requires planning.

Bank Procedures: Your Ecuadorian bank will require a copy of the registered Escritura Pública to justify a large international wire transfer. We manage this documentation process for you.
Currency Exchange: Be mindful of exchange rates and bank fees. We can advise on the most efficient methods for transferring your funds.

Professional Due Diligence Checklist for a Secure Sale

[ ] Verify Title Deed (Escritura Pública): Confirm ownership, legal description, and official registration.
[ ] Obtain a Clean 'Certificado de Gravamen': Prove there are no liens or prohibitions on the sale.
[ ] Secure 'Certificado de No Adeudar al Municipio': Clear all property taxes and municipal fees.
[ ] Obtain Certificate of Paid 'Alícuotas' (for Propiedad Horizontal only).
[ ] Verify Building Permits & 'Planos Aprobados': Ensure all construction is legally registered.
[ ] Draft and Execute a Legally Sound 'Promesa de Compraventa': Secure the buyer and deposit (arras).
[ ] Engage a Reputable Notary (Notario) for the closing.
[ ] Calculate and Pay Municipal 'Plusvalía' Tax before the closing date.
[ ] Oversee Signing of 'Escritura Pública de Compraventa' at the Notaría.
[ ] Confirm Final Registration at the 'Registro de la Propiedad'.
[ ] Facilitate Fund Repatriation: Provide necessary documents to your bank.
[ ] Maintain a Complete File of all legal and financial documents.

⚠️ Broker's Legal Warning: The Most Common Expat Selling Mistake

The single most damaging mistake an expat seller can make is assuming their property's paperwork is in perfect order. I have seen deals collapse weeks before closing because a Certificado de Gravamen revealed an old, unpaid mortgage from a previous owner, or the municipality discovered an unpermitted second-story addition. A buyer's due diligence will always uncover these issues. By unearthing and resolving them before you list, you transform your property from a potential liability into a prime, marketable asset. My primary function is to preemptively solve these problems, ensuring your sale proceeds from a position of legal and financial strength.

Selling your property in Ecuador should be a rewarding conclusion to your chapter here. With expert legal and real estate guidance, you can navigate the process with confidence, security, and financial clarity.

Ready to secure your property sale and leave Ecuador with complete peace of mind? Schedule a property-risk consultation with me today.