How do i acquire property in Mexico as a foreigner?
Foreigners may obtain direct ownership of property within Mexican territory. However, foregners cannot hold title to property withing 100km from the border and 50 km from the coastline.
However, there is a system in Mexico that allows non-Mexicans to purchase property, providing great protection for the property owner.
In order to purchase real estate foreigners must aquire the property through a bank trust, formalized with a Mexican Banking Institution. As a buyer, you will be designated as the main beneficiary and can designate substitute beneficiaries in the event of death, tat way avoiding probate procedures upon death.
The bank trust is established for 50 years, renewable for the same period of time prior to expiration, the trust bank will let you know that it’s time to extend the term for another 50 years.
Can i acquire through an LLC?
Yes, the trustee bank would designate the LLC as the main beneficiary of the trust. However, since the LLC is a foreign entity, there are additional requirements for such an LLC to conduct business in Mexico.
Can I acquire in Co- Ownership?
Yes . In the trust, oth co-owners will be designated as main beneficiaries. It’s common that such co-owners designate themselves as substiture beneficiaries, and they can also designate 3rd parties, as substituitive beneficiaries in the event of death.
If the bank holding my trust ceases doing my business, is there any risk of losing my property?
No . With the assistance of the Mexican Banking comisión, the trustee bank would be replaced by another.
What are my closing costs?
Closing costs are typically paid by the buyer and vary on a case to case basis, depending on the purchase Price, and are usually between 5% to9% of the purchase Price. Closing costs include notary fees, government taxes and duties, trustee bank fees, government permits, among others.
What is the role of a Public Notary in Mexico?
The public Notary is a government appointed oficial. Part of his responsibility is to calculate, retain and pay taxes on behalf of both the buyer and the sellerat closing. The notary will issue a deed by means of which the real estate transaction will be formalized, and this document is recorded in the public registry.
Propery taxes are very low in Mexico. The vary according to jurisdiction in Mexico in which your property is located. Taxes are paid annually, with the assesses value being determined at the time of the sale and base don the purchase Price.
Do i need an attorney?
Yes, the real estate transaction is subject to the excecution of multiple legal documents, therefore it is important to have a real estate attorney to guide and advise you during the process.