Managing Ecuador Property Risks. When navigating property transactions in Ecuador as an expat, one critical piece of advice stands out: DO NOT SIGN A Power of Attorney (POA) unless it’s with someone from your trusted inner circle, ideally family. I emphasize trusted family because, unfortunately, even familial ties can be tested by greed. Here in Ecuador, the circle of trust can become very small indeed.
You might wonder why a POA is often suggested, or what you’re told you need it for. A common scenario involves expats who want to sell their property but are unable to stay in the country. A “trusted” attorney might suggest you sign a POA, promising to handle the sale and advising you to go enjoy your life. But beware; this can lead to disastrous outcomes. Just recently in Canoa, a man signed a POA to sell his lot, only for the attorney to abscond with the $40,000 sale proceeds. The buyer received the deed, but the seller was left without his money, dealing with a legal quagmire between him and the attorney.
Â
If you’re planning to sell your property, consider listing it and appointing someone local, perhaps a realtor or a friend, to manage showings for a commission. You can then return to handle the sale personally if a serious buyer emerges. Before you commit to flying back, secure some earnest money to confirm the buyer’s commitment. This not only shows their seriousness but also covers your travel expenses should the deal fall through.
Another critical point for expats is the lack of escrow or trust accounts here, unlike in the U.S., where such accounts ensure funds are securely held until all conditions are met. An incident in Manta involved a buyer transferring $150,000 into what he believed was an escrow account, set up by an attorney through a Power of Attorney (POA), only for the money to vanish without the property changing hands. Pursuing such financial discrepancies in Ecuador, especially on the coast, can be an incredibly daunting and lengthy legal battle. I’ll tell you right now, it’s just not worth the time and stress it will cause you.
From my perspective as a seller, when someone shows interest in property I own and they want to move forward with the process to purchase I require earnest money— in this case. This step initiates a process where we aim to close within seven business days. During this period, I gather necessary documents from the municipality to prove no outstanding debts, which might take 2-3 days. I share these documents with the buyer to keep everything transparent.
I have a trusted person who prepares the closing contract. The contract will be in Spanish, and I’ll also provide an English copy for reference. It’s a fairly straightforward agreement, but if you’d like an outside attorney to review it, there are plenty of lawyers who work with expats and will charge a small fee for a quick review.
Once all the paperwork is ready, we’ll schedule an appointment with the notary. On the day of closing, the buyer must show proof of a bank transfer. I’ll only sign the documents at the notary after confirming that the funds have been transferred. At that point, the buyer will receive the property deed.
Congratulations — you’re almost officially a property owner in Ecuador! Just one final step: you need to register the deed with the local property registry. Here in BahÃa de Caráquez, that usually takes 1–2 days.
Once that’s done, you’re all set. Time to kick back and enjoy your new expat life on the beach!
Â
Here’s a piece of advice everyone should take seriously: be extremely cautious with Power of Attorney (POA). Personally, I wouldn’t sign one—and you probably shouldn’t either. It’s a common area where things can go wrong.
Buying or selling property in Ecuador isn’t overly complicated, so take the time to learn the process—it won’t take long. If you decide to hire a lawyer, be selective. There are plenty of bad ones out there, just like anywhere. Don’t rely on one recommendation—talk to several expats and see which names come up again and again. I’m also happy to recommend a few attorneys with solid reputations.
