Buying Property In Mexico
During the last ten years , property in Mexico has
become a lucrative investment bringing a new bread of sophisticated
investors to the market. The Mexican government has realized it
is now essential to make owning property in Mexico safer and easier
then ever before with new rules in place to protect the non-Mexican
landowner. These rules have been formed to protect ownership rights
and to promote the sale of Mexican real estate to foreign investors.
The Mexican constitution prohibits foreigners
from purchasing or owning real estate within 60 miles of a international
border or 30 miles of a coastline. Because of these restrictions
a new safer method of ownership was needed to allow investment and
safer ownership within these areas. The creation of an instrument
called the "Fideicomiso" now allows safe ownership for
foreigners within these areas. This Mexican property trust is much
like a estate trust giving a foreigner full rights of ownership
within the restricted areas.
Financing
With the advances in the real estate market here in Mexico and the
introduction of title insurance. We are now pleased to be able to
offer financing to prospective investors through US financing companies.
With the safer and more secure market comes many more alternatives
for our US and Canadian customers investing here in Mexico.
The "Fideicomiso"
The department of foreign affairs in Mexico City issues the fideicomiso
to a bank of your choice, allowing this bank to act as the purchaser
of your property. Your bank will then in turn act as the "trustee"
of the issued trust and you will be the named
" Beneficiary" of the trust. This property will not become
an asset of the bank, and the Fideicomiso only allows the bank to
be a "trustee" of your trust. The bank will only take
instructions from you the "beneficiary" and you have the
sole rights to use, occupy and posses your property. This includes
the rights to build and improve on your property as well.
With a Fideicomiso, the "Beneficiary" can ask the bank
"trustee" to sell or transfer title to a qualified buyer
at any time. Named inheritance is also permitted with a Fideicomiso.
The initial term of a Fideicomiso is 50 years with 50 year additional
renewals indefinitely. This Fideicomiso is not to be confused with
a land lease very common in other parts of the world; this property
you purchase will be placed in trust with you named as the beneficiary
of this trust.
On average a Fideicomiso takes approximately 60 days to complete
with some taking as little as 2 or 3 weeks to complete. With costs
to establish the Fideicomiso trust currently running around $2500.00
dollars, with yearly administrations fees of approximately $400.00
dollars.
Title Search :
Dorado Properties strongly recommends a title search being done
in all property purchases. These are provided by our agency to all
clients as standard practice.
Title Insurance:
All though title insurance is fairly new to the Mexican real estate
market, with the introduction of new sophisticated investors this
has become very common with real estate purchases. Several companies
now offer Mexican title insurance with Stewart Title the most common.
Dorado Properties recommends that title insurance be purchased for
all real estate purchases.
Who is involved in a real estate transaction here in Mexico........
Normally there are three to four professionals involved in a real
estate transaction where a foreigner is purchasing in the restricted
zone.
1. The Real Estate Agent or Agency
2. The Purchaser's Lawyer
3. The Bank from which the Fideicomiso will be applied.
4. The Notary.
All four of these people will be helpful in their respective areas
all though the lawyer is not always necessary . With many aspects
of Real Estate purchases being done differently here in Mexico is
very important to always employ professionals who are familiar with
all aspects of these transactions. We at Dorado Properties are dedicated
to protecting our customers interests, and to guarantee your interests
we only do things one way, and that's the right way.
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