Steps of the Buying Process:

Step 1: FINDING PROPERTY Step 2: MAKING THE OFFER Step 3: MAKE THE CLOSING

Te encuentras en un momento maravilloso. Después de una cuidadosa selección, has escogido la propiedad que encaja con tus necesidades, el vendedor ha aceptado la oferta que le has hecho y se ha formalizado tu deseo de comprar esa propiedad.

A continuación te explicamos los lo que falta por hacer para que puedas considerar esta propiedad como TUYA:

• RETAINING LEGAL COUNSEL : At this point, a buyer may elect to have professional counsel to review the contract, prepare a Purchase Sales Agreement, and/or to administer the closing process with the Notary Public.

• ESCROW ACCOUNT : Before proceeding with the signing of the contract, and if an escrow account is to be utilized, the creation would initiate at this point.

• CONTRACT : Basically the information outlined in the verbal agreement and Offer to Purchase document are then expanded and detailed in the Agreement to sell/buy contract. This document details property costs, inclusions and exclusions, as well as the deadlines being established in the “Convenio de Compra/Venta” (sale agreement). Once signed by the buying and selling parties, a deposit (10%-20%) is normally paid by the buyer and cancellation penalties are established if either party cancels without contractual expressed reasons.

• PROPERTY DOCUMENTATION : The seller will need to present official documents which may include: original property deed, up-to-date tax receipts for the property, public utilities bills (shown without outstanding amounts due), condo association bills (shown without outstanding amounts due), amongst others.

• PRIVATE TITLE SEARCH : Before proceeding with the establishment of the Bank Trust, and if a private title search is realized, this would be the period in which to hire such services. It is important to mention that the Notary Public has the responsibility and realizes this activity of title research within his services and fees. It was not common to do title neither researches nor title insurance till only a very few years ago here in Mexico. The research is realized in preparation for a commitment letter, followed by the title insurance by private organizations.

• BANK TRUST OR MEXICAN CORPORATION : If the property is inside the 50/100km coastal/border zone (Restricted Zone) and you are a Mexican Foreigner, you will need to set up a trust or a Mexican Corporation. The rule of thumb when choosing between a Mexican Corporation or Bank Trust; if you plan to use your property as a business or plan to have at least 4 or more properties, a Mexican Corporation is a tool of choice, other wise, residential properties are established under a bank trust.

• PERMISSION FROM THE FOREIGN SECRETARY´S OFFICE : If setting up a bank trust, your bank representative normally administers the preparation of this permission. Otherwise your legal counsel can arrange the paperwork. At this point, you will also be asked to sign the "Calvo Clause", which states that you will not seek foreign jurisdiction in dealings with your property transaction.

• NOTARY PUBLIC : Once the bank trust is prepared, choosing and establishing the meeting with the Notary Public is arranged. The Notary Public’s position is quite different than accustomed in the USA. The Notary Public’s preparation, position, and responsibilities are viewed upon much as a Judge’s position in America. They are appointed by the Governor of the State and the Executive Branch of the federal government for particular state districts and are attorneys who have passed two extensive examinations in order to receive their lifetime appointments. The Notary Public’s responsibility during the property transaction include:

i Confirm that the land is private and officially owned by the seller. 

ii Arrange for an official appraisal of the Land (Avaluo).

iii Collection of official documents from the buyer which include Photo ID (passport), Birth Certificates, Marriage Certificates, and your visa (could be a Tourist Permit).

iv Collection of official documents from the seller which are mentioned above from the Buyer.

v Title research of the land is realized by the Notary Public which involves the research of the public records to determine the status of seller's title to the property and the existence of any liens against the property.

vi Collection of Capital Gains Tax. The Notary Public will calculate the amount due and collect when the deed is signed over to the buyer. Normally these taxes are due by Seller.

vii Collection of acquisition taxes and other local and state taxes. These are due by the buyer.

• PAYMENTS : Whether you are paying with cash or via some kind of financing you (or your lawyer representing you) will need to have the agreed funds available for hand-over at the Notary Public's office on the date the deeds are transferred in your care. Cashiers Check or wire transfers can be utilized. Wire transfers are normally prepared by the buyer and his bank in preparation to execute during the meeting with the notary public and seller, at the date of deed transfer.

Escrow balances are also prepared beforehand for release of monies at the deed transfer signing date with the escrow officers.

With the deed signed over to the buyer, the Notary Public and legal counsel fees are paid. Taxes due by both Seller and Buyer are also paid (acquisition tax, public registration tax and others). Real Estate Agents fees are normally paid by the seller and can be arranged to be paid during and from the instructions within the escrow account.

Money Transfer Declaration: Cash or monetary instruments (of any kind) with a value of or exceeding USD$10,000 MUST be declared when you enter Mexico (and the enter/exit the USA - even if you are in transit to Mexico from elsewhere via the US). There are no limits on how much you can transfer in or out of either country - but sums over the US$10K limit must be declared on a special form.

• PUBLIC REGISTRY : after the property transfer has been formalized, the notary public will record the deed “escritura” with the Mexican public registry of property where the property is located.

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