Don’t Forget to Register the Deed

Real estate transactions in Brazil must be registered in a notary office (Cartório de Registro de Imóveis). Yet it’s common - particularly with foreign buyers of Brazilian real estate - to find signed purchase and sale agreements that lack proper registration. So who suffers? Both the buyer and the seller.

For the buyer, there’s a huge problem. They don’t technically own the property. Sure, they may have a contractual right to it, but it’s not theirs until a public deed is filed registering the transaction. And good luck finding the seller to get their signature on the deed after they’ve been paid.

The seller also has some risk. Because the seller is still the owner of the property according to the public records, he remains responsible for paying the property taxes (IPTU). If the taxes aren’t paid, the property can’t be transferred. Plus, the municipal tax authority can file a lawsuit against the seller.

According to Article 1,245 of the Brazilian Civil Code, an agreement that transfers real estate property must be registered in a notary office for the transfer to be valid. Hence, the deed is a crucial document. Without the buyer and seller signing and registering the deed, title to the property won’t change.

Lawyers use the word “closing” when discussing real estate transactions because a deal isn’t “closed” until a myriad of legal requirements are completed. If you’re buying or selling property in Brazil, don’t just rely on your contract. At a minimum, go register the deed.