Here is all you need to know about the key players in Mexican real estate when you are a foreigner buying property within the restricted zone (the area within 50 km of the beach and borders in Mexico). If you plan to purchase a real estate within this zone and you do not hold Mexican citizenship (permanent residency is not enough), there are 4 parties that you should involve in your transaction. Each of these parties provides assistance in their respective areas and gives targeted services for a smooth real estate transaction.
Having a team of knowledgeable, seasoned and committed Mexican real estate agents to guide you through each step of your transaction will surely help you pass through the proceedings with less hassle. Your purchase will be a smart and secure transaction when done with the right people on your side. This is how different buying properties in Mexico is compared to what you might have experienced before. Realtors are optional for Mexican real estate purchases but very useful.
Buyer’s attorneys are also optional when buying Mexican real estate but they can help you in a lot of ways. Legally, only a licensed Mexican attorney should give counsel on the laws related to Mexican real estate transactions. Foreign attorneys are not permitted to practice law in Mexico and are therefore not ideal to give advice on the matter. An attorney will represent you and protect your legal transactions. Although it is an option, it is highly recommended that you have an attorney working with you side by side through each step of your real estate dealings. Aside from being your best guide and looking only for your best interest, an attorney can help you save money. Most of them have good connections with banks, notaries, and even the Mexican government.
A Notary’s role is very important in Mexico. It is so significant that a Notary can be liable both for civil and criminal terms. A notary’s tasks include calculation of capital gains tax, ratification of all real estate transactions in Mexico, and authentication of legal documents. If a real estate transaction is not ratified before a notary and not recorded in the Public Registry, it will be considered invalid and not enforceable. Being equally responsible for the buyer, the seller, and the Mexican government is a key role of a notary. You cannot but Mexican real estate without the services of an authorized notary.
Any Mexican Notary (Notario Publico) is a licensed attorney, given authority by the state and Federal government to act as an official and fair representative of the Mexican government. In Mexico, a Notary acts equally as a notary in Canada but has greater responsibilities than a notary in the US. Being a Notary means you have passed stringent exams mandated by the Mexican government. A Notary, therefore, is considered a government official. Another important task that a Notary does is securing original records and documents and making sure the records are within the Public Registry of Property.
When foreigners purchase Mexican real estate within the restricted zone they are required to purchase a fideicomiso trust from a Mexican bank. This trust carries a yearly fee. The trustee or fideicomiso is the Mexican bank you authorized to steward your property. Choose a bank that has a trustworthy reputation. As a Mexican real estate buyer, you have the privilege to choose any qualified bank which you believe will ensure appropriate and legal closing. The Bank Trustee is not allowed by the law to transfer ownership of the property or change its beneficiary rights. It also has no right to do anything about its property without your written consent. Trust is guaranteed indirectly by the government to its Mexican banks. There is also government protection against bankruptcy.