Legal Services
The process of property purchase in Barbados is similar to that
which obtains in the United Kingdom, involving a contract of sale
followed by a formal conveyance; though, unlike in England and
Wales, the majority of titles in Barbados have not yet been brought
under the registered land system.
Mortgage financing in Barbados follows closely the United Kingdom
model and is readily available to nationals and non-nationals alike.
Once you have selected the property you want to purchase, you
will require the services of an attorney-at-law qualified to practice
in Barbados. The whole conveyancing process, from agreement
for sale to completion, should take approximately 3 months.
The minimum scale of legal fees for non-contentious business is
prescribed by the Legal Profession (Attorneys-at-Law) (Remuneration
for Non-Contentious Business) Rules, 1997. The Schedule to
that Act states that legal fees for agreements for the sale and
purchase of land are to be charged on the basis of time spent and
the responsibility undertaken. Generally, the minimum fee for preparing
an agreement for sale (on behalf of the vendor) is
$400.00 (Bds), while the fee for the attorney acting on behalf
of the purchaser in respect of the agreement is $600.00
There will also be costs (not fees) to be paid by the purchaser
for obtaining an abstract of title from a competent legal search
clerk whose responsibility will be to abstract the title of the
property from the deed books contained in the Land Registry. This
procedure obtains if the title to the property being purchased
is unregistered. When the results of the investigation of title
are presented to the purchaser’s attorney, his responsibility
will then be to properly peruse the title to ensure that there
is a 20-year period of unbroken chain in the title. If there are
any gaps or broken links in the chain, the attorney for the purchaser
will ask the vendor’s attorney to remedy the position. For
example, there may be a mortgage on the title which the purchaser’s
attorney will require to be released.
In the case of registered title, the Government guarantees title.
A request for search is sent directly to the Land Registry. The
whole conveyancing procedure for registered title is intended to
be simpler, faster and at less risk to the purchaser’s attorney.
Hence, the prescribed minimum legal fee in the Legal Profession
(Attorneys-at-Law) (Remuneration for Non-Contentious Business)
Rules, 1997 is 1/3 of the normal conveyancing fee
for an unregistered title when acting on behalf of the purchaser,
and 2/3 of the normal fee when acting on behalf of the vendor.
The normal scale will apply for preparing and perusing agreements
of sale (please see above).
The minimum scale of conveyancing fees when
acting on behalf of a vendor in the sale of land is as follows:
Up to $25,000
(value of the property) $750
On the next
$75,000 2%
On the next
$100,000 1.5%
On the next
$300,000 1.25%
Thereafter 1%
The minimum scale of conveyancing fees when acting
on behalf of a purchaser in the sale of land is as follows:
Up to $25,000 $1000
On the next
$75,000 2.5%
On the next
$100,000 1.5%
On the next
$300,000 1.25%
Thereafter 1%
If a purchaser is obtaining a mortgage in order to purchase the property chosen,
the lending bank or other financial institution selects its lawyer from a pool
of attorneys who customarily work for it, to handle preparation of the mortgage.
The purchaser (the ‘mortgagor’) is required to pay the financial
institution’s costs of preparation of the mortgage, in addition to paying
his own attorney for handling the mortgage. Where the attorney acting for the
purchaser in the sale is also acting for him in his capacity as mortgagor, the
Legal Profession (Attorneys-at-Law) (Remuneration for Non-Contentious Business)
Rules, 1997 states that the attorney is entitled to charge the normal conveyancing
fee plus one half of the fees normally charged for the mortgagor’s attorney’s
fee.
The minimum scale of conveyancing fees when
acting on behalf of the mortgagor (purchaser who is seeking financing)
is as follows:
Up to $25,000 $750
On the next
$75,000 1.5%
On the next
$100,000 1%
Thereafter 3/8%
The above fees are the basic fees which are charged on property
transactions involving sale and purchase. In addition, there may
be a legal fee of $250 for obtaining Exchange Control Permission
(required on all sales where either party is not resident in Barbados)
and, where an attorney is acting on behalf of the vendor, a charge
of $100 for obtaining the necessary Land Tax Certificate indicating
that the taxes on the property have been fully paid for that
land tax year, and another $100 for preparation of the Change of
Ownership Forms and Non-Commission or Commission Forms, as
the case may be.
The vendor is responsible for paying Property Transfer Tax,
the rate of which is currently 2.5% of the sale price. If there
is a building on the land, there is an exemption of $125,000
and, thereafter, the rate of tax is 2.5%. The vendor is also responsible
for paying stamp duty on the conveyance, which is currently $10.00
for every $1,000 of sale price.
For unregistered land, the purchaser pays stamp duty on his mortgage
at the rate of $6.00 per every $1,000.00 borrowed, and he also
pays recording charges at the rate of $4.00 per page for
both the conveyance and the mortgage. |
