By: Resendiz Wong Abogados, Real Estate Attorneys in Mexico
Step 1. Find a piece of undeveloped property, home or condo which you would like to purchase and verbally agree on a price with the seller.
Step 2. Upon receipt of the buy/sell agreement (convenio de compra/venta), which is typically composed by the seller’s real estate agency, have your attorney review the detailed costs, inclusions and exclusions, as well as pertinent timelines set out within. Once everything has been approved by your attorney, a deposit of around 10% shall be paid to the seller, and cancellation penalties shall be set in case either party pulls out. These cancellation penalties are normally equal to the amount of the deposit, but this is something which may be negotiated by your real estate attorney in Mexico.
Step 3. If the property is located within the restricted zone, you will need to establish a trust with a local bank. This process is explained in more detail in our “Guide to Buying Property in Mexico” which you may review by following the link provided. Your legal representation will notify you as to which banks are currently offering the best rates for holding the property deed on your behalf.
Step 4. You will need to request permission to purchase Mexican property from the Foreign Secretary’s office, where you will be required to sign the “Calvo Clause”, in which you agree not to seek assistance from your government in the case of any conflict pertaining to the property under consideration, and that in the case you do request such assistance from your government that you will automatically forfeit your rights to the property.
Step 5. Your attorney will investigate as to whether the seller is in good legal standing and is legally permitted to sell. In the case the seller is a real estate development company, it is also important that your attorney ensures that they are properly registered and all of their permits are current and in good standing.
Step 6. Once you have received copies of the property deeds from the seller, your attorney will verify with the Notary Public that they accurate and there that there are no existing liens on the property.
Step 7. Your attorney will also verify that the property is not included in an ejido land claim. Ejidos are explained in more detail in our “Guide to Buying Property in Mexico”.
Step 8. Your attorney in Mexico will then review any official land appraisals provided by the seller and then arrange to have the property reappraised to ensure that there are not any significant incongruencies.
Step 9. Your real estate attorney in Mexico will verify your legal status in Mexico to the appropriate authorities by presenting copies of your Passport, Birth Certificate, Marriage Certificate, Visa, etc.
Step 10. Your attorney will require that the seller provides up-to-date original versions of, the original property deed, current tax receipts, utility bills and all corresponding land-service fees of the property in question. All of these documents must be shown to be paid in full to assure that you are not left responsible for any unpaid debts. (Under Mexican Law, all liens or unpaid debts are transferred with ownership of the property).
Step 11. Unless otherwise stated in the purchasing agreement, the seller will pay the Capital Gains Tax, the price of which will be determined by the Notary Public.
Step 12. Full payment is made at the time the deed is signed over to you. This shall take place in the Notary Public’s office in the presence of your real estate attorney in Mexico. Your Mexican attorney’s and the Notary Public’s fees are paid at this time as well as any corresponding taxes involved in the land purchase.