Buying Property in Mexico
In 1973, the Foreign Investment Law allowed foreigners to purchase property anywhere in Mexico, except in the restricted zone—32 miles from high tide and 64 miles from any border. Most foreigners, however, only wanted to buy property on the coasts or near the borders, so in 1994, Mexico passed another amendment to the constitution. Now foreigners can own property in the restricted zone with a bank trust or fideicomiso.
Foreigners can’t own property in the restricted zone outright. Instead, a real estate trust (fideicomiso) is set up. The fideicomiso is executed between a Mexican bank and the seller of property in the restricted zone. The bank acts on behalf of the foreign buyer, buying and taking title to the property. The foreign buyer retains all rights of ownership.
Before you begin, retain a Mexican attorney and ask to see his attorney’s license. First, all foreigners are required to obtain a permit from the Ministry of Foreign Affairs. Next, to open your trust account, you’ll need your accepted offer for purchase, a photo ID and 10 percent of the purchase price of your new home. Do not give money to anyone other than a bank escrow representative when you sign a bank contract.
Closing usually takes 30-45 days. Contact Kim today if you are interested in property in Mexico.