#773 – The Expat Files: Navigating Costa Rica’s Roads and Real Estate

Automatically transcribed from the original recording; names and wording may contain errors.

[00:00] South of the border down Mexico way That's where I fell in love when the stars above came out to play and now as I wonder Hello there all you expat wannabes. I'm Johnny Mueller and you're listening to the expat files living in Latin America The show that tells you just what it's like to live work play and or retire down here in Latin America It's a mix of the good the bad the ugly and the great and it's all right here. So let's get started Okay, how about this for an email dear Johnny? I don't want to call you a liar maybe just a fibber, but you're always saying that things are so much cheaper in Latin America Well, it just so happens that last week me and the wife came down on a nice tropical Central American vacation package deal

[00:49] rental car included and I got nailed by a radar cop for 420 bucks, so keep telling us Johnny about how things are so cheap in Latin America where I come from in Detroit 420 bucks is about par for the course for a speeding ticket there, too Oh by the way me Johnny here and I forgot to tell you this comes from our listener Cameron and then he goes on to say Johnny I searched and searched online for great package deals And I thought I got the package deal of this century was around 900 bucks for me and the wife to stay at the Hotel Zandari in Costa Rica for an entire week rental car Included only to find out the hard way one speeding ticket cost half of the entire trip. Ah me Johnny here Kind of answered his own question. Didn't he he said he took his vacation in Costa Rica

[01:39] Or as my Canadian friends like to say hey there Johnny. It's Costa Rica Where it's been so gringo eyes to all bets are off Concerning cost of living and well saving money on practically anything however as he says those package deals are fantastic In fact a lot of them are so cheap You can't imagine how they're making any money off them at all and you know they're not it's the upsells They're counting on for example if you get a great package deal to Cancun for five days or a week all inclusive resort and all That there's about a hundred percent probability that you're gonna get sucked into a timeshare or some kind of real estate or coconut Plantation seminar and of course they lure you into those things by Promising you a free gift or some more free days the next time you come down and those hotel marketing teams know for a fact

[02:27] That gringo is when they're off their own home turf are Starry-eyed and fanciful loose with their money and are ready to buy into a lot of that crap I mean come on how many times have you had buyers remorse in your life? I think I've had that every time I bought a car or even a coca-cola for that matter and these days with all the finance And credit options it's easy to sign on the dotted line because almost no one reads the fine print right so by all means I do recommend sussing out all those great package all-inclusive deals. Yep You'll find them all over the internet But when you get there make sure you keep your credit cards in the room safe now one guy The famous expat Eddie he tells me he never gets sucked in to go into one of those free seminars where they give you gifts and dinners and extra hotel rooms because

[03:12] He's the kind of guy who feels terribly guilty when he gets something for free And he doesn't give back something in return so Eddie actually did buy into two separate timeshare deals That was a while back and he did it because he's such a soft touch He felt guilty for getting the free toaster and golf ball washer on the poor Avida keychain Oh, and let's not forget the poor Avida t-shirts in those two free hotel nights And you know, I don't get it everything in Costa Rica is poor Avida this and poor Avida that and you know what? There ain't nothing natural and pure about the life in Costa Rica. Not anymore, man I'm telling you if I hear someone say poor Avida to me just one more time. I'm gonna smack him. I mean virtually, of course Hmm. So if you are a soft touch and there's one in every family do try to avoid any kind of marketing or promotion

[04:00] Meeting or seminar and believe me. I don't care which resort you're staying at Someone's gonna come around either in the dining area or at the pool and pester you and of course Who do you think they're targeting in places like Cancun and Costa Rica? Not the locals one guess The which brings us back to Cameron's email He says Johnny when I got pulled over by those two radar cops while I was standing there They pulled over two more rent a cars with gringos in a meanwhile I saw plenty of local drivers with local Costa Rican plates going a lot faster than we were and the cops never made a move To pull them over so right there. We realized they were pulling over rental cars and gringos exclusively I mean who else is gonna rent a car in Costa Rica, right? And there's another problem roads are very poorly marked and the speed limit signs. They're all over the map, too

[04:46] Sometimes it's 25 kilometers an hour sometimes 50 or 90 sometimes you can drive for an hour and not see a single one So unless you live there and actually know where those signs are posted and what they actually mean It'll still screw you up because you know us Americans were not big on the metric system So we're always in miles per hour in our heads So the truth is I don't know if I was speeding or not Maybe I was maybe I wasn't because I found out after being behind the wheel about ten minutes And this is the first time I've driven in Latin America that she just tried to keep up with the flow of traffic Whether it's at a snail's pace or going well balls to the wall and look out for pedestrians Just whipping across the street road obstacles those gigantic speed bumps you talk about Johnny and last but not least those wild and crazy Motorcyclists who all seem to have a death wish so when I did get pulled over

[05:35] I asked a cop like I'd would in the states if I could see my speed recorded on the radar gun because he never did tell Me how fast I was going over the limit. He just said too fast. You're speeding He just wouldn't show it to me kind of shielding it even when I insisted and you know those Costa Rican cops I found out speak pretty good English when it comes to giving out tickets and talking about money When I pressed him a bit he started getting a little nervy I just said well at least I should be able to see it on the gun, right? He gave me a look and I knew I should never have opened my mouth I knew right then I was never gonna be able to schmooze my way out of this one now the problem is Johnny I was there with my wife and my wife is as straight as they come She doesn't lie about anything except the usual things women fib about and we men gladly play along with

[06:22] You know age weight IQ natural hair color and plastic surgery anyway She was standing there right by my side as every good wife should be except in this case I wish she wasn't because when I tried to offer the guy a bribe She stealthily kicked me in the shins and that hurts then she gave me that steely look only wives can So before I even had the chance to offer the guy a bribe I went into the default mode of following the rules Even though I knew he probably would have taken a hundred and let us go along our merry way and as for the other Two rent a car gringos that were pulled over at the same time. They were in and out of there in record time So I knew they just had to have paid him off, but not me dumb me Meanwhile as I was sitting alongside the road and one cop was filling out paperwork and such the other cop pulled over another two or three

[07:09] Rental cars which aren't that easy to spot not for common people like us Anyway, because rental car companies know their vehicles can be targets for cops and thieves, etc However, there are always a few telltale little stickers on the windshield and also as the rental car guy told me when I returned the vehicle The cops know the particular sequences of numbers on the license plates and there are certain cars that are very popular with rental car agencies like for example Suzuki sidekicks and grand vataras because they're small and they have four-wheel drive So as for the cops if they want to hassle you it's not that hard worse yet when I was sitting around the rental car Office talking to people I found out that there's a certain way cops like to trap gringos You see everyone and I mean everyone passes trucks that are going very slow and blowing clouds of smoke in your face

[07:58] Especially on uphill grades where they're gunning it But not necessarily getting anywhere and they do it on straightaways and on curves too Especially where there are lots of hills and mountains and I found out cops set up traps on curves Just to nail ran a cars and gringos because as I found out if you're on a too late road And you're behind a slow truck and you don't pass them all the cars behind you will be laying on their horns And you're the one who's gonna be taking all the heat not the truck that's causing all the problems in the first place But as a gringo with a rent card you could get in trouble for going with the flow In fact the guy in the rental car office told me that people in Costa Rica routinely get fines of 600 to 1200 US dollars for passing on a curve But it won't be the local sell pullover always the gringos and the rental cars because they know

[08:46] Gringos cannot leave the country at least there's the threat They can't leave unless they pay up any and all moving violations All right me Johnny here just a little comment You know on the gringo tourist trail the cops will set the fines because they know most gringos will pay off right there And they realize we have no idea what the rates are for the fines for various violations So basically they size us up and fill in the blanks And isn't it funny that when you're on the gringo tourist trail Cancun Costa Rica Panama whatever most often it turns out when you get Pulled over the moving violation fine will pretty much work out to be about one month's salary for that cop What a coincidence how's that happen? Oh and another thing I know lots of people who live in Costa Rica locals and gringos and what I'm hearing from my gringo friends

[09:34] There is that Costa Rica now has the highest traffic fines in the world And of course, it's just an unintended consequence a secondary effect of all the gringos that have been piling in Oh, here's another thing Costa Rica's police departments now have a nationally connected system so that if you get a moving violation First it gets registered at the police departments and municipalities and then that information sent out to the rental car agency so that when you bring your car in the rental agency will make you fork up the fine because if they check out your car and You leave before the fines paid they're on the hook for it And then that information actually gets sent to immigration at the airport which makes for an interesting lag time situation here because as it turns out if You were to get a ticket one or two days before you're gonna leave the country or turn your car in being that there are so

[10:23] Many lard-ass pus brain slugs in government That means if you get a ticket and of course you only get one if you haven't bribed the cop and a lot of people Don't because they are straight arrows Like Cameron's wife and by the way, it's mostly guys who pay bribes women are really reluctant to do that Which is why cops on the take will always make the first move and say look you can pay the fine off right here with Me that's the way we do things here in Latin America, you know And that's why Latin cops always prefer pulling over a gringo male versus gringa because it's innately harder to bribe a woman She's much more inclined to say just give me the ticket I'll pay it down. It's a station and in that case the cop gets no drinking money at all out of it So in that respect women and men are not equal. Gee, I wonder if I'm gonna get a hate mail for saying that hope so

[11:10] so anyway, I guess the big lesson learned here is that gringos should not be driving or Renting cars in highly gringoized areas or your nice cheap package deal all-inclusive vacation that you're so proud to have snapped up So cheaply could end up costing you a substantial chunk time wasted in a lot of stress Just because you passed a slow-moving diesel belching truck under pressure Oh, and here's another thing if you get a DUI in a Latin country Which is unlikely unless you get in an accident because you know in Latin countries It's legal to have open beers in your car at least if it's not legal the cops didn't get the memo yet Anyway, as it turns out get a DUI in a gringoized Latin country Like Costa Rica is a lot cheaper than getting a speeding ticket imagine that

[11:56] So think about if you get pulled over by a cop for anything in Costa Rica. It's gonna cost you big time What if you don't have that kind of dough on you because remember if he says 600 bucks You could probably get away with a hundred or two as a bribe, but what if you don't have cash? I mean a lot of people don't carry that much around with them Which I think is a big mistake, but you know, it is a plasticized society People are gonna do what they're gonna do. Well, that's easily solved. All you do is tell the cop you've got plastic and he'll gladly Accompany you to the nearest ATM machine and you know It's a hell of a sightseeing a cop standing with a gringo at an ATM machine I've seen it twice myself next time I promise I'm gonna get a photo of that Of course, the caption would be not to serve and protect but to serve and extract

[12:42] Yep, only in Latin American pretty much only on the gringo tourist trail though I've heard of certain cases especially around Christmas time where Latins have had a police escort to an ATM machine Because when it came down to cases, they didn't have any cash either But I've got no personal boots on the ground stories of that happening to gringos or expats off the gringo tourist trail Anyway, though when we're talking about on the gringo tourist trail Sure I've heard firsthand accounts of that and it always makes me wonder why people fall for the BS they hear from International living AARP and all those retirement rags if I've said it once I've said it a million times as soon as international Living or any of those expat retirement blogs puts some Latin country or city on their top ten list The party's already over there are no more deals and the leftovers are gonna be first-world expensive

[13:31] Which reminds me of a crazy story that happened me a long time ago in Chicago. You want to hear it? Well, even if you don't you're gonna way back when I was in undergrad engineering school before smartphones before the internet before Fakebook and anti-social media before rap hip-hop rag-a-tongue pop-up porn and earlobe expanders Well, I was driving along minding my own business and an Illinois state trooper pulled me over and man Those guys do not have a sense of humor just the facts ma'am and all that He nailed me with his radar gun and the fine was around 60 bucks And that was when 60 bucks was like 300 bucks today Anyway being a poor student with an old used car I did not have the money but I didn't know if I didn't pay up within 15 days to find would keep Increasing and then when I renewed the plates on the car

[14:19] I'd have to ante up even more dough that I didn't have but being that I was an electrical engineering student I had an idea. I had a microwave and wave guide teacher named professor Grouse Yep, just like the beer and you know, it's funny the majority of professors I had at engineering school were either Germans or German Jews In fact, I actually had a physics professor who knew Einstein personally So anyway, I spoke to professor Grouse. Yep spelled exactly like the beer in the noise days I'd never tasted a Grouse beer. They were too expensive and I couldn't afford it came in those funky snap-top bottles Remember those anyway, I remembered in my microwave class. Dr Grouse had a section on police radar to demonstrate the fact how Inaccurate they could be if you didn't hit the subject head-on with the beam

[15:05] in other words, he said the cop would have to be standing pretty much right in the road to get a 98 or 99 percent accuracy on a reading and if he's off to the side of the road taking his readings behind a tree or a Bush or a sign the wider the angle from the target the bigger the error and you know for his little example He calculated the error for different angles In fact, he created a nice table in one degree increments up to 60 degrees So we had a little powwow and I told him I wanted to go to court and fight that ticket to Show the judge and the cop that because he was taking his readings from behind a sign at about a 20 degree angle from the cars He was targeting you can look up the angle on the table and the error was plus or minus 15 percent Of course, the real reason I wanted to go to court was not to prove a point

[15:50] But because I didn't have the dough to pay the fine, but I didn't tell professor Grouse that he was all in because He wanted me to make a fool of the cops So anyway that ramrod state trooper got me at 66 in a 55 zone 11 miles an hour over and according to microwave theory taking his readings around 20 degrees off the direct path of the cars Meant his readings could be 15% off So I could really have been going 56 miles an hour in a 55 zone and he'd never pulled me over Of course, it's a plus or minus 15 percent error. So it also could have gone to the high side I could have been going 76 miles an hour, but I wasn't gonna mention that in court So anyway on the back of the ticket Said if you want to contest the ticket you have to dial this number and tell him you want to go to traffic court

[16:35] No set a time and a date and when that happens, you know, the cop shows up and it's your word against his So I went down to the Chicago municipal courthouse, man. That place is rockin Smelled pretty bad too since that's when they rain all the drunks in the morning So there I was all spiffed up wore my only suit my high school graduation suit from a few years earlier I had an artist easel that I borrowed from my girlfriend and some big posters where I sketched the street the direction of the car Where the state patrol guy was some angles plotted out and the sign he was hiding behind and I had copies from dr Grolsh of some microwave calculations showing that the greater the angle of the beam from the target the greater the percentage of error in the Reading so as I ambled down the courthouse hall with my easel in my briefcase

[17:24] I saw my ramrod state patrol guy sitting on a bench with a bunch of other cops waiting their turns to be called for various cases Now I admit I was the oddball there were some people dressed in suits But I was the only guy with an easel and some poster boards and I did get some strange looks and the state patrol guy Gave me a hard glance too. So I found a place to sit in about an hour later They called me into the courtroom where I sat with some other people who are contesting various moving violations, too And surprisingly enough none of them actually won their particular cases But all of them had their fines and the points they were gonna lose knocked back considerably For example one guy had a hundred twenty dollar ticket knocked down to thirty bucks and from five points down to two So as it turns out it seemed just by showing up the judge and have a little pity on you and knock your charges back to

[18:11] A lesser count give you the benefit of the doubt sort of so I figured I had that going for me anyway All right. So then came my turn. I went up to the front by the judge set up my easel Put up my first poster board and I said to the judge judge. I got a speeding ticket It was captured on radar and I'm here to contest that reading then the judge looked over to that special place up front Where all the cops sit and you know, the thing is they have to be there to state their side of the story You know and surprise surprise We waited something like 10 minutes in my ramrod state trooper never showed up Oh, he was right out in the hall that whole time But nowhere to be found now he did not go into the courtroom to take his place So finally the judge called out the troopers name three times hit the gavel and said case dismissed and hey

[19:00] I thought wow that was easy and man Was I happy with myself and who wouldn't be because you know back then I had a lot more time than money In fact, I had almost no money. So then a couple days later. I went to see professor gross I told him the story and he just chuckled. He said I knew it. I knew it I said you knew what he said kid you'd scared the piss out of him because you know if he would have showed up and you Proved how far off those radars can be word would get around and everyone and his mother to be using that for their defense Now I swear to god that story is true. In fact, I think my mother still has those posters in the attic at her house In Chicago, she saves everything everything that is except my vintage comic books, which she threw out. Hmm, mom Why did you do that? So what's that story have to do with anything?

[19:49] Well, I just thought you'd get a kick out of it And for those of you who've ever been nailed by a radar gun now, you've got a little ammunition Anyway, I'd like to thank Cameron for that email because it says so much about being and living on the gringo tourist trail here So again by all means take advantage of those cheap all-inclusive package deals They're great, but don't drive and don't get sucked into a timeshare presentation. All right moving on Here's something I get emails on all the time, but we never really talked about You know gonna bees and wannabes and people with active plan B's are always saying Johnny Can I get a mortgage down there in Latin America? Do banks offer such things to gringos and expats and often people with boots on the ground will say when I'm driving through nice neighborhoods in Latin cities and I see those beautiful gated guarded

[20:35] Subdivisions that aren't all filled yet and there's signs out in front of the guard gate saying there's lots or condos or houses available With financing. Well, does that apply to gringos? All right So let's tackle those points right now what I have right in front of me in Spanish She's a beautiful full colored pamphlet of one of those very nice gated guarded subdivisions where they've got model homes and condos on display And there's a whole page here talking about the requirements to get Financing so I'll read these off one at a time now and I'll translate it of course when I'm done doing that You'll know if you two can qualify number one You'll need a photocopy of your residency card or your passport number two You'll need a photocopy of your knit number. That's an IT number here in Latin America

[21:20] That's kind of like your social security number and you'll get that after you've applied for temporary or permanent residency By the way, you can also get an IT or knit number if you were to open a bank account or have a business That's on the books. All right so far so good. That's easy number three You must provide a notarized document that says you have worked a minimum of one year at a commercial company or as an independent professional engineer architect accountant Whatever and it says the company that produces that document must have been in business and has carried on business Operations for a minimum of three years number four. You'll need three professional references That would be doctors lawyers gangbangers narcos scratch that number five You'll need some current utility receipts for water light and telephone in your name an essay

[22:08] Corporation's name or the name of a landlord you may be renting from and in that case You'll need a letter from your landlord saying you are a renter in good standing number six You'll need the last three months of your bank account records Sealed and signed and notarized by a bank official number seven You'll need a certified letter from your employer or from your accountant if you own a business showing the last two years of your income and it says if you're working for a company they have to be signed and sealed by The human resources department and notarized then it says if you own your own business You have to supply them photo copies of the last three months of your product sales And if you own your own business, you'll have to supply them with copies of the last three months of your company

[22:55] And you'll have to provide copies of the last three months of your payments to the tax system of your Latin country In other words proof that you're paying taxes And then it says if you're renting space for your business now You'll need the last three receipts Showing that you've paid your rent and a letter from your landlord saying that you're a renter in good standing All right. So those are the standard requirements if you're looking for a home loan or financing from the developers of a subdivision However, here's something you ought to know. I know some gringos who have bought into these gated garter communities And of course, they couldn't meet all those requirements. They'd only been in country maybe three-quarters of a year or so They didn't have a legit business in Latin America yet The one of them was making big money on the internet, but he didn't want to let that information up But still both these guys got the financing because each of them was able to show they had

[23:43] $25,000 or more in a local bank account now to us that isn't a hell of a lot of money But it's not trivial either but for people here in Latin America have that kind of dough in the bank It's almost unheard of unless you're a helicopter kid and your parents are loaded and even then a lot of those people are as they say In Texas all hat and no horse There are a lot of old families here in Latin America that are extremely land-rich and cash-poor Anyway, if you can prove you've got 25 grand or so in the bank down here or even in a CD in one of the local Latin banks that is and of course they all have CDs denominated in fiat dollars and local funny money, too And you get this and dollars they're paying three even four percent whereas up in the states these days You have to pay the banks to hold your money. Don't get me started on the banks

[24:29] What a bunch of crooks and thieves anyway It seems if you've got that kind of dough in the bank You could bypass three-quarters or more of the steps that were just outlined Oh and another thing you heard me say many times that they've vastly overbuilt in most all Latin American cities Both on and off the gringo tourist trail and they've overbuilt at the high end So the sales and occupancy rates are miserable in the upper middle to high end range And again your average gringo expat down here on a plan B does not want to live in middle class Latin housing That would be more like white trash up in the states You want to live in upper middle class Latin housing, which is middle class according to most people I know who live in Cleveland anyway since there are so many so-called upper middle class and high-end Condos apartments and houses on the market and with no buyers out there

[25:14] You'll find these days that many places who were once asking high down payments like for example 20% down Now after a few years with no action at all. They're asking as little as $500 down and in some cases no money down at all shades of the u.s. 2007 2008 housing bubble Yep, that's exactly how it's shaping up and on top of that I've also been noticing in some of the newspaper classifieds and on olx.com in the housing and real estate section that some people are now willing to sell as a rent to buy option because it seems many of them have a cash crunch and Can't make the payments and if they default their credits ruined forever And they'll never be able to buy a house or a car on payments again But if someone else came in and took over the payments

[25:59] That means you can get in without a down payment to and without having to qualify for a loan You just take over the payments and the paperwork and that's something that's quite new down here I've never seen that before but it's here now And that's another good reason to start plugging away at learning Spanish and you know if you're just the least bit fluent Let's say 40% You'll at least be able to figure out olx.com where all the deals are and you'll be able to read the classified ads in the newspapers and check the housing and rental prices and therefore bypass the English speaking realtors and middlemen that are always gonna take a big chunk out of you if you have to go crawling to them to translate for you and here's a little tip On that front if you see any kind of real estate for sale or for rent and it says these two words. No Commission is does no commission is does that means they don't want any middlemen or realtors to call them or make a deal to

[26:52] Get their listing that means it's the owner who's selling or renting the place and he doesn't want to deal with remax or century 21 Or any of the other real estate broker or middleman dickheads and that's how you get the best deals of all you go right to the owner Because you'll find in almost all cases when someone says no commission istas or sin commission istas means the same thing No, middleman. They've actually gone that route had little or no action are Frustrated and figure they could do a lot better trying to sell it by themselves That way they figure they can lower the price a bit because they won't be paying a commission anyone and make their property more Appealing in the marketplace. So when you see those words, no commission istas. Take note. You're looking at a desperate seller You've been listening to the expat files living in Latin America If you need some help with your own plan B, you can schedule a one-on-one phone call with me

[27:40] But first download my free plan B questionnaire at www.thenewexpat.com Better yet if you want to get your plan B going from right up there in the states Just sign up for my 9-hour expat essentials course Get the perfect plan B blueprint by going to the expat files comm Academy