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Outline Property Purchase Procedure

If you have hired a lawyer (which is recommended but not compulsory) then he/she will likely act as an intermediary between you and the Notary Public / Seller.

The exact process will vary in each case, but you (or your lawyer) will follow a process that goes along these lines:

  • Find a property you like; agree a price verbally
  • Agreement to sell/buy, with detailed costs, inclusions and exclusions, as well as deadlines, is set out in an initial "Convenio de Compra/Venta" (sale agreement), at which point a deposit (5-10%) is paid by the buyer and cancellation penalties are set (usually equal to the deposit) if either party pulls-out.
  • If the property is inside the 50/100km coastal/border zone, you will need to set up a trust.
  • Next, you seek permission from the Foreign Secretary's office (a formality) to buy land. You will be asked to sign the "Calvo Clause", which states that you will not seek foreign jurisdiction in dealings with your property transaction.
  • If you are buying from a developer (e.g. a new housing estate) advise the Notary Public who will ensure the developer's permits are in order
  • Get a copy of the Land / Property Deeds from the seller. The Notary Public will check these out.
  • Ask the Notary Public to check that the land is not Ejido land, as discussed earlier
    An official appraisal of the Land (Avaluo) needs to be carried out; your Public Notary can arrange this.
  • You Notary Public (or lawyer) will ask for official documents that can include (but are not limited to): Photo ID (passport), Birth Certificates, Marriage Certificates (if appropriate), and your visa (could be a Tourist Permit) to show your stay in Mexico is legal.
  • The seller will need to present to the Notary Public documents including (but not limited to): original property deed, up-to-date tax receipts for the property, public utilities bills (shown as paid), plus up-to-date details of land-service fees (shown as paid)
  • Capital Gains Tax is paid by the seller, unless you have agreed to pay CGT as part of the buying agreement. The Notary Public will state how much this is.
  • Payment is made (see note below) at the time when the deed is signed over to you, and this is done at the Notary Public's office.
  • The Notary Public's and Solicitors (if applicable) fees are paid at this time as well, as well as other taxes associated with land purchase (see Taxes, below)

Payment: 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 signed across to you.

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.

U.S. institutions gear up loan programs for Mexican land rush
By STEVE McLINDEN
February 2, 2005
Pacific Mexican Renaissance:
The coveted coastline of Mexico is now available for foreign investment.

The Luxury of Home, in Mexico
By Janelle Brown
January 7, 2005

New York Times

Mexico Dreaming:
For real estate fantasists, nothing beats an empty stretch of beachfront. Just add house.
Buying Real Estate in Mexico:
Separating Fact from Fiction
Capital Gains in Mexico:
What you do today dictates your tax liabilities tomorrow.
Building in Mexico:
Manifesting Your Construction
The History of Mexican Land
The History of Land Ownership in Mexico
What Can An American Buy in Mexico?
Costs and Taxes
Financing Your Mexican Property Investment
Ejido Lands
The Role of the Notary Public in Mexico
Outline Property Purchase Procedure
Buy or Build, or "Fixer-Upper"?
Valuation of Property in Mexico
What's Doing In Puerto Vallarta
By TIM WEINER
Published: October 7, 2001
lapuntarealty.com
Within Mexico
Tel: 01 (800) 841-2133
Fax: 01 (329) 291-6421
From US/Canada
Tel: 011 52 (800) 841-2133
Vonnage: (213) 291-7590

 

Punta de Mita office:
Tel: 01 (800) 841-2133
Fax: 01 (329) 291-6421
From US/Canada 011-52 (800) 841-2133

San Francisco office:
Tel: 01 (311) 258-4325
From US/Canada 011-52 (311) 258-4325

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