Before we get into the specifics, understand this: Panama has tremendous wealth inequality, and expats visibly land on the "have" side of that divide. To a lot of people, your foreign bank account—and your newcomer's naïveté—looks like the answer to their problem.

Sometimes that's a calculated scam. Other times it's a contractor who truly believes he can do the work and takes your deposit before reality catches up with his skill set, or a landlord who's quietly decided your security deposit is just bonus income. The line between incompetence and dishonesty blurs fast, and either way, you're the one left holding the bill. A good attorney is your best defense.

Open a bank account (if you don't have residency)

When we arrived to get our Friendly Nations Visa (FNV) in 2021, we got our first taste of how Panama's right hand doesn't always talk to the left hand.

At the time, the immigration department required a bank account with a $5,000 balance as part of the FNV residency process (we squeaked in under the old FNV process, so I'm not sure how it is now). Most of the banks, however, required you to have residency to open an account.

Attorneys usually have connections with banks that can streamline the process of a non-resident getting a bank account. (It's not likely you'll need an attorney to open a bank account if you already have your residency.)

Complete the residency process

The residency process is one of the most important (and obvious) reasons to hire an attorney. It's best to connect with them before you leave your home country so you can do what you need to do before you leave. It's much easier this way!

Panamá LOVES bureaucracy! A competent lawyer will ensure that all your documents are in order and that you meet all the requirements, saving you time and avoiding delays. They also know the ins and outs of local immigration laws, and can help you avoid common pitfalls and fines.

Review real estate rental, purchase or building contracts

Whether you're renting or buying property, contracts in Panama can be tricky. First, all legal contracts must be in Spanish. Second, the laws and terms are not necessarily the same as your home country.

An attorney can review your contracts to ensure that your interests are fully protected. They will identify any red flags and ensure you're not signing anything that could lead to disputes or leave you open to scams later on.

For example, some builders may include a clause that holds you responsible for any future labor disputes. This has the potential to cost you thousands of dollars.

Determine the best way to hold title to real estate

Owning property exposes you to liability and scams in Panama, so it's important to take a hard look at what the best way to hold title.

An experienced attorney can help you decide whether it's best to hold title in your name, through a foundation, or in a corporation, based upon your unique needs. They will also help you set up the appropriate vehicle and structure to protect your assets and comply with local laws.

Unfortunately, I did not get quality guidance on this matter, which enabled a scammer to target me and place an unjustified lien on my property. (If you think the legal system will protect you from scams, you'd be wrong.)

I highly recommend looking into holding title to your property in the name of a foundation, both for legal and estate purposes. However, make sure you get educated on the tax consequences in your home country before you make the final decision.

Steer you clear of scammers

Unfortunately, unethical builders, contractors, or even so-called "helpers" target newcomers who are at a disadvantage because of their limited knowledge.

Local attorneys will usually have intimate knowledge of the crooks in their area and will protect you from a nightmare. They can also help vet builders, real estate agents, and other contractors to minimize the odds of future legal issues.

Assist with employment & business setup

If you're planning to work or start a business in Panama, an attorney will be critical in navigating the country's labor laws and business regulations.

Your attorney can help you get your work permit, set up your corporation or, in some cases, both so you are in compliance with Panama's laws.

Estate planning

Panama's estate laws may differ significantly from what you're accustomed to in your home country. An attorney can advise you on how best to structure your estate in Panama, ensuring that your assets are protected and that your heirs can easily inherit your property.

Resolve disputes

Should you ever find yourself in a legal dispute (like my ex 😢) or the victim of a scam (like me 😤), having a trusted and aggressive attorney will make all the difference. They can represent your interests and hopefully help resolve your issues in a way that minimizes stress and financial loss.

And go in with realistic expectations. Whether you've been wronged or you're defending against a bogus claim, just participating costs real money and real stress—there's no "this is obviously frivolous, case dismissed." If the dispute is with a Panamanian, loyalty tends to run local, so you may start at a disadvantage; if it's between you and another expat, the system may not prioritize it at all. And time moves differently here in the worst way: a civil case takes a year at the very minimum, many drag on for five, and I've heard of some taking twenty. Whatever you're hoping to recover, plan to be in it for the long haul.

One word of caution, though: the attorney whose name keeps coming up in every expat group and forum isn't automatically your best bet. Popularity here often means overloaded, and overloaded means you risk becoming just another file on a very tall stack. Vet hard, interview a few candidates, and give the relationship some time before you hand over anything big.

Final thoughts…

Getting a skilled, honest attorney before you arrive in Panama will help minimize issues with your residency process and prepare you to handle issues that WILL come up here.

Don't wait until you're already knee-deep in challenges—start working with an attorney early to make your transition as smooth and stress-free as possible!

— Operation Expat