FAQ's
What is SRE Notification?
This is the fee, a non-Mexican must pay to purchase property in México. Approx. $500.00 each.
What you need to buy Real Estate in Mexico?
- Passport
- Visa- With Readable Stamp on Back
- 10% of Purchase offer Price for Down Payment
- A Notario to do the "Closing"
- SRE Notification.
Are there Mortgages in Mexico?
Yes, information available upon request.
Buying with Direct Deed
This clause which is part of the Constitution is very important for foreign real estate owners. The clause states that the real estate owners agree to be bound by the laws of Mexico and not seek recourse to law in their home countries. Foreigners must sign a Calvo Clause agreement to obtain permission for real estate ownership from Mexico’s Secretary of Foreign Affairs. This clause is usually inserted into property deeds.
Can we get Title Insurance as in the US or Canada to protect us?
Yes, it’s available.
Deposits and Escrow
A deposit of earnest money is expected to accompany presentation of the offer to the seller. A deposit of ten percent is customary. The practice of escrow in Mexico is in an early stage, There are established companies, such as Stewart Title among others, offer escrow services. Can a real estate company act as the escrow agent'? Yes, it can and many do so.
Do they have Clear Deeds in Mexico?
Yes, the only difference in your deed here than the US or Canada, is the deed is in Spanish.
Do you own the land?
Yes, you own the land. There are restrictions on ocean front property and properties bordering other countries.
TRUST: The property is held in trust by a bank of your choice. Benefits: anyone can be beneficiary, Problems: An annual fee is paid to the bank which raises yearly.
How do I receive title to my Real Estate?
You have a choice of: DIRECT DEED: Similar to the US except beneficiaries must be direct line or spouses....No annual fees
If you should be responsible for paying Capital Gains, how is it figured?
When you purchase your property, a new Avalúo (Tax Evaluation) is done on the property, and when you sell the property, another Avalúo is made. The difference between the two avalúos is considered taxable for Capital Gains tax. It does not matter what you paid for the home, nor what you sold it for. If you make major improvements, like room additions, added a carport, etc, these can be deducted. The Capital Gains can be as much as 25% of the avaluo difference.
Items need to close property with a Notary?
- Signed Contract
- General Information Sheet on the Buyer
- Immigration papers (FM-2, or 3, or FM-T)
- Passport
- Power of Attorney (if you are not going to be here for Closing) (Less expensive here than states. Approx. $250.00 US)-
- Permit Money for Property Purchase ($500.00 Us per person) (This takes at least 8 days)
Closings take approximately 30 days.
Steps in the Transaction?
For foreigners, the process of finding and purchasing a property in Mexico follows the same general sequence and principles as in the USA, Canada, and Europe. Purchasing real estate involves:
- Finding the property
- Negotiating an offer
- Performing due diligence
- Obtaining proper documentation
- Arranging payment
- Closing the transaction
Within the transaction's sequence of events, there are key differences in procedures, documents, and people involved in the transaction. "Buying south ofthe border, however, is not like buying property in the United States or Canada, and purchasers must always remember that the process is different than purchasing another house in their neighborhood. Even if you believe you are a savy real estate person, take off your domestic blinders and prepare to look through a different set of glasses. That is not to say that real estate transactions (operaciones) in Mexico are totally different or more complicated... but more awareness, street sense, and patience usually are needed.