Most of the foreign investors find the buying process in México to be an extremely professional and pleasant experience!
The most important part of this process is to make sure that you are represented by experienced people such as your realtor and lawyer. In Mexico it is always wise to ask for a referral to find the most qualified person to represent you.
How do I purchase a property in Mexico?
A foreigner can purchase property located within 62 miles (100 kilometers) of any border or within 31 miles (50 kilometers) of the Mexican coastline through a Bank Trust (Fideicomiso), the Mexican government has gone to great lengths to make it safe and simple.
What is Mexican Bank Trust (Fideicomiso)?
The Mexican Government issues a permit to the Mexican bank of your choice, allowing the bank to hold title to the property, while the purchaser holds title to the beneficiary rights (almost all Mexican banks are owned by or in partnership with American or European Banks). The bank acts as the Trustee and you become the Beneficiary of the Trust.
As the beneficiary of the trust, you maintain complete control over it, retaining the use of the property and making all investment decisions.
Why is a Fideicomiso necessary?
The purpose of a Mexican Bank Trust is to allow foreigners to buy Mexico real estate inside the "restricted zone," and ensure a safe and secure transaction. The "restricted zone" is any land within 31miles (50 km) of the coastline and 62 miles (100 km) of the borders. The Mexican constitution, when created, was designed to protect their land and prevent the kind of massive land loss they had endured through their history.
Is the Fideicomiso an asset of the bank?
No. Your trust is not an asset of the bank; they are merely the stewards of the trust. You and those you designate are the beneficiaries.
The trust to your Mexico real estate property is held by the bank for the beneficiary (you) and is not considered an asset of the bank therefore not exposed to any legal action that the bank might find itself in. The trust is the beneficiary's property.
The Trust is initially established for a period of 50 years and can be renewed at any time by a very simple form and a nominal fee. The trust is set in 50-year increments guaranteed renewable in perpetuity.
Advantages of the Fideicomiso:
You can transfer your rights in the fideicomiso to another foreign buyer.
One contract can hold more than one property in the same deed.
You may rent, sell or remodel the property.
Your heirs can inherit the rights to the fideicomiso, effectively by-passing probate, should you depart without a proper will.
There are tax advantages pertaining to capital gains taxes when you sell.
The fideicomiso is easy to maintain by paying an annual fee to the bank.
Mexican banks have government protection against bankruptcy.
The trust is guaranteed indirectly by the government.
Comments