You Need to Buy Mexican Real Estate

Four Parties You Need to Buy Mexican Real Estate

Are you planning to buy Mexican real estate? If your preferred land is within the restricted zone (within 50 km of the coastline and borders), it is important to know that there are 4 important parties involved in your transactions. Each of these parties will provide assistance according to their expertise. With their help, the process of follow to buy Mexican real estate is easy.

  • Notary Public
  • Buyer’s Attorney
  • Bank (Fideicomiso)
  • Real Estate Company

Notary Public

You need an official and unbiased representative of the government of Mexico whenever you transact in real estate business. You cannot buy Mexican real estate without the services of a notary. A Mexican Notary (Notario Publico) is a licensed attorney duly certified by the state and Federal government. A notary in Mexico acts the same as those in Canada and has greater responsibilities than notaries in the US. A Mexican Notary has gained the position as a government official after passing stringent exams given by the Mexican government. All records they provide must be original and must be recorded in the Public Registry of Property. A Notary can be held liable in both civil and criminal terms, that is why a notary’s role in Mexico is very serious. Aside from these expectations, a notary is also tasked to authenticate legal documents, calculate capital gains tax, and ratify all real estate transactions in Mexico. A real estate transaction which is not ratified before a notary and rightfully recorded in the Public Registry is considered invalid and non-enforceable. In any real estate transaction, the notary is highly responsible both to the buyer and the seller, as well as to the Mexican government.

Mexican Real Estate Buyer’s Attorney

It is not compulsory to have a buyer’s attorney when you buy Mexican real estate, but it is recommended. It is also important to get a Mexican attorney instead of a foreign one since foreign attorneys are not licensed to practice law in Mexico. Getting the service of a licensed Mexican attorney will provide you with advice on the laws related to the real estate. The attorney will represent you and protect all your legal transactions. It will also be the attorney who will draw up contracts and review the terms and conditions of the sale. Aside from these, an attorney can help you save your money as they have lots of contacts including banks, notaries, and the Mexican politics.

Mexican Bank for your fideicomiso trust

Your authorized bank is your Trustee Bank which will act as Trustee (fideicomiso). The bank must be a Mexican registered financial institution. As a buyer, you must choose a qualified bank which will ensure a legal and appropriate transaction. The bank will provide a trust for the real estate which you own and control on your own. The bank trustee is not allowed to transfer ownership of the property, change the beneficiary rights, or do anything about the property without the owner’s written instructions. With the government protection against bankruptcy, the trust is guaranteed by the government indirectly.

Real Estate Company

When you choose to buy Mexican real estate, the procedures will be different from what you may be familiar with. It is important to have the right people for your business transactions. Having these people and a team of experienced, knowledgeable, and dedicated real estate agents will make your experience not only different, each step is ensured with guidance, and the outcome is a smart and secure buy.

Rental Agents and Realtors in Mexico

Rental Agents and Realtors in Mexico

If you are planning on making Mexico your second home, then it is wise to set aside time to find out where you will be staying. It may seem like a lot of work in preparation, but it is well worth your time doing so. Often, it is a good idea to rent property before you purchase, unless you have fallen in love with a place you have found while enjoying try and buy visits to Mexico.

Rental agents and realtors in Mexico

It is not a bad idea to surf the internet to see what is posted as available rentals and properties for sale, but most people looking to stay for long periods in Mexico like to have a local realtor help them find the right property for buying or renting.

The services provided by realtors in Mexico to those looking to buy property are free because they are paid by the current owners of the property —whether selling or renting. So, it is very good sense to work with a realtor— especially if your Spanish is not good and you have limited knowledge about the location you plan to move into. If you are buying, realtors can do a lot of the busy work of negotiating for you.

A beneficial local agent will invest in time to find out what your needs are and what your budget looks like for acquiring a property. The realtor will be your spokesperson—negotiating terms, interpreting terms for you and explaining any additional information you may need.

Make sure your realtor is a member of AMPI (Asociación Mexicana de Profesionales Inmobiliarios, Ciudad de México, A.C) because this organization ensures consumer rights are protected by regulating real estate policies.

best places to retire

Mexico is No.1 – International Living’s Best Places to Retire

Recently, Mexico has taken the No. 1 spot as being International Living’s best places to retire, especially for expats from the United States. International Living (IL) is one of the main authorities on relocating statistics and world-wide retirement.

Mexico is No.1 – International Living’s Best Places to Retire

The statistics for the best places to retire used by International Living are based upon a number of criteria: living costs, how easy it is to get a residents visa and general quality of life. Currently, statistics show that there are over one million expats from America living in Mexico who have decided that it is one of the best places to retire; so it is easy to see why Mexico has taken the No.1 spot for retirement locations around the world.

Best Places to Retire Abroad

Retiring abroad is a popular trend that is still growing and growing, and in the coming years it will only increase. Here are a few of the other countries that made the International Living’s top ten list of best places to retire abroad:

  • Costa Rica
  • Malaysia
  • Panama
  • Columbia
  • Malta
  • Ecuador
  • Nicaragua
  • Spain
  • Portugal.

Why have these countries made the list of best places to retire abroad? Let’s take a look at the top reasons why:

Living Costs are Affordable

While the best places to retire around the world are usually beautiful places in temperate or warm climate, but most retirees are more concerned about the living costs where they retire. One of the main attractions of Mexico is that the living costs are highly affordable. Retirees can live a very comfortable life without a lot of money in Mexico. The housing, food, and amenities will cost less than in your own country, and private healthcare is affordable too in Mexico. You might be surprised a the high quality of medical care you can receive in Mexico.

Mexico is Close to United States and Canada

How close a location is to your home country also has an impact on whether the place is a good destination for retirement. Spain and Portugal are popular locations for retirees from the UK, France, Germany and the Scandinavian countries while Mexico and Central American Countries like Costa Rica and Nicaragua are convenient for retirees arriving from Canada and the United States. Mexico, however, stands out amongst its competition for best places to retire because it is so close to the US and Canada with lots of flight options. Direct flights are offered in the top tourist locations in Mexico, which include Puerto Vallarta, Cabo, and Cancun, which makes getting back home easy to do. It is easy to hop on a flight and be back home within a few hours, which takes the hassle and stress from retirees that want to get back home to visit family or attend special occasions.

The Best Activities and Entertainment

It may surprise you that there are plenty of things to do for retirees in the top cities in Mexico and it is easy to become part of the community with lots of charitable foundations to support with your time and/or money. You will also see familiar brands that will make you feel at home, including Walmart, Costco and Starbucks, as well as many fast food chains that you will recognize. Obviously the charm of retiring in Mexico is to experience the Mexican life, but now and again it is nice to see familiar brands. The dining options are world class and plentiful. There will be English movies in the theaters along with nightlife, festivals, and music tours that come to these areas.

Many English Speaking places to retire

It is very common that English is being spoken in the major cities in Mexico. This is often a big worry and concern for retirees that are considering retiring in Mexico. If you don’t speak Spanish, then you don’t need to worry, because you will find that many people speak English in the popular expat towns in Mexico like Puerto Vallarta, Cabo, Cancun, Lake Chapala and San Miguel de Allende. Obviously, learning Spanish is a lot of fun and great to keep your brain exercised.

Are you considering retiring in Mexico? Let us know what your thoughts or concerns are below.

Mortgages in Mexico for Foreigners

Are there Mortgages in Mexico for Foreigners?

Are there mortgages in Mexico for foreigners? Mexico has been a growing market that provides long-term mortgage loans. Although, the long-term mortgages in Mexico are still new when they are compared to Europe, the United States, and in Canada. Foreigners can get a mortgage in Mexico as there are plenty of financing sources, but you should know that the interest rates are higher when you compare them to other countries. Are you eligible to receive a mortgage in Mexico? Continue reading to see the factors that are considered when applying for a mortgage in Mexico.

The Mortgage Industry in Mexico

The mortgage industry in Mexico is on the rise, but compared to the top world economies Mexico mortgages are still behind. For Mexican nationals, the loans are available in pesos with an average 10-12% fixed rate, which of course is much higher than in Europe, the United States, and Canada, but if you are wanting a mortgage in Mexico it’s accessible. The mortgages in Mexico provide the buyer with 90% of the value of the home, so the buyer will only have to pay 10% of the deposit and any fees that is required. The fees are usually 5%, and the mortgage can be paid over the next 20 to 25 years.

Is it Possible for Foreigners to get a Mortgage in Mexico?

It is possible for foreigners to get a mortgage in Mexico, but it isn’t an easy task. Foreigners must possess a permanent residency in Mexico and they must be employed by a Mexican company that pays into the Mexico taxes. The banks will loan foreigners the money to purchase property in Mexico and if you are a permanent resident of Mexico and you can provide income that is foreign, then you also can qualify for a mortgage in Mexico.

Foreigners can also choose a private developer financing, which can be done on a home that is being built.

Foreigners can also draw up a contract, then negotiate an agreement with the seller, so the buyer can pay for the property over time, and this type of mortgage is a short term mortgage loan, but foreigners must be aware that the short term mortgage generally requires a 50% deposit or down payment and any private loan also comes with many risks and the interest rates are very high.

The Minimum Requirements for Foreigners Wanting a Mortgage in Mexico:

  1. Mexican bank statements for the last 6 months
  2. Foreign bank statements for the last 6 months and/or Mexican employment pay slips for the last 6 months
  3. Permanent or temporary residency
  4. A birth certificate
  5. A RFC tax number
  6. A medical report and certificate for eligibility for life insurance
  7. Good credit score in Mexico or good credit score from your own country credit service
  8. Proof or address

There are plenty of mortgages in Mexico for foreigners. Foreigners should look over their options, then proceed with the mortgage that suits their needs and preferences.

Simple Living in Mexico

Simple Living in Mexico

Simple living in Mexico is an added attraction for foreign residents moving to Mexico. One of the most popular statements from foreigners that relocate to Mexico say that they are looking for a simple lifestyle. When people move to Mexico they often reflect on their decision and they immediately discover that their lifestyle back in their country was very expensive and way more than they even realized. A simple lifestyle is reducing the cost of living. If you move to Mexico and you want to live a luxurious life, then you will spend more time in Mexico than your own country, because the lifestyle that you can have in Mexico comes with added benefits and attractions, but at a much lower cost.

Your Priorities Change

Simple living in Mexico will have you changing your priorities to where what matters most in your life is having a healthy body and mind, switching your work schedule, and having a new space that you can enjoy with your friends and family. After you have done this you will have less stress and clutter in your life and your quality of life will be simple, but you won’t be poor. The people that are soon to be retiring or are retired are relocating to Mexico, because modern technology and the internet allows working professionals to work and live in Mexico.

Affordable Living

Working age people are relocating to Mexico due to their many variety of attractions. Soon to be retired people are moving to Mexico too and Mexico is becoming the most popular choice over any other country for retirees. The land and home costs are affordable in Mexico and are much more affordable than in Western Europe, Canada, and the United States.

Lower living costs in Mexico

Finances are the cornerstone for why people are considering to relocate to Mexico. Lower living costs adds to more income for working aged people and for those on a fixed income and those retired the added income from the lower living costs allows them to live a much lavished lifestyle. The lower living costs in Mexico will allow your income to be more and to stretch further. Remember, your lifestyle choices will determine your actual living costs in Mexico. Simple living in Mexico is the main reason working age people and retirees are relocating to Mexico. You can live a much better life for a fraction of the cost if you relocate to Mexico.

Mexico Property Insurance

Mexico Property Insurance

It’s always a good idea to invest in property insurance if you have a home or watercraft in Mexico. Having insurance on your Mexico property will help protect you in case of unexpected

Mexico Property Insurance

Mexico property insurance policies are not like those found in the U.S. and Canada because the terminology used and types of coverage offered are usually significantly different. Therefore, you can’t expect a standard policy to contain the same types of eligible coverage criteria in a Mexican property insurance policy that you may find in an American policy. As a solution for this difference, there are insurance companies in the U.S. that specialize in Mexican insurance law and policy-making. These specialty companies collaborate with the Mexican insurance companies to underwrite policies that are recognizable to Americans while still maintaining the legal validation of Mexico.

Non-Spanish Speakers

Unless you speak great Spanish and have no problem dealing with your insurance terms in Spanish, it will be best to have your policy prepared at one of these specialty insurance companies in the U.S. Having a familiar policy format for your Mexico property insurance may prove to be ingenious if you ever must file a claim in an already tense situation.

Check what’s included on standard policies

Moreover, US-led policies may have coverage options (for instance, third-party liability cover) that may not be found in the standard coverage for the Mexican insurance company. So, you may have to pay extra premiums for items that automatically would come in the standard policy with the specialist U.S.-based company.

Depending on what you want you plan to cover with regards to your Mexico property insurance, may be the determining factor for using a direct Mexican insurance company or one of the specialty insurance companies in the U.S.

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Home Insurance in Mexico

What You Need to Know about Home Insurance in Mexico

Depending on your personal needs and preferences, circumstances, and of course your budget, you can choose Mexico home insurance entirely or even partially. The cost of home insurance in Mexico will depend upon a few different factors, which would include the location of the property, the type of property, the value of the property, the age of the property, and what items you would like to be covered.

Home insurance in Mexico

An “All Risks” insurance coverage is offered by some insurance policies in Mexico. This type of home insurance coverage will pay you with generally most incidents and accidents that involve the property. There are better policy coverages that can protect you for incidents that are classified as catastrophic, which would include fire, earthquakes, floods, winds, hurricanes, and volcanic eruptions. However, not all of the home insurance companies in Mexico are able to cover you for all of these potentially catastrophic events.

Property owners in Mexico can lower their insurance premiums by electing to limit “Named Perils” that will be assigned to your home insurance policy by just choosing to take “All Risks” insurance coverage. What does this mean? It means that certain events may be covered while other events will not be covered. The insurance policies that are cheaper in cost are called “Named Perils”, which is often mistaken to be comprehensive insurance. Make sure your insurance broker provides clear instructions between these type of insurance along with the differences and prices of the insurance options.

What to include in your home insurance in Mexico

Your home insurance policy should always cover the structure of your home. You can even add coverage for carports, garages, studios, game rooms, and any outbuildings. Many homes in Mexico come with several different structures, which would include a central courtyard with several buildings built around it, and many insurance policies do not cover these added structures if they are not connected to the main home.

Contents Insurance in Mexico

A great home insurance policy in Mexico should cover all the personal belongings that you own, or those that are owned by your employees and any guests (within your home). Some of the home insurance policies in Mexico will also cover jewelry, arts, sporting equipment, money, though this coverage may be limited and need premiums for particularly expensive items. There may be an option if you would like to add higher insurance limits on different items, which is generally located on the special selection area of your home insurance application form. Theft insurance coverage may vary as it will depend upon if it has been specifically listed or is added to the “scheduled” area.

Loss of Use or Rental Income

If your Mexico property is used for work or it is a rental income property, then you can add a “loss of use” risk to your insurance policy. This coverage would provide you coverage for any expenses caused by the fact that you cannot use your property for a long period of time. Also, if your property is very damaged and it will take a while to repair or even rebuild the property, then your home insurance will cover for all loss of rental income that you would have gained. Evidence is often required, and a rental contract is good evidence.

If you have a home in Mexico, then this is what you need to know about home insurance in Mexico.

Reference: Mexperience
Ownership Opportunities in Cabo

Traditional Ownership Opportunities in Cabo

Foreigners and Mexican nationals alike can enjoy a number of traditional ownership opportunities in Cabo, from full ownership of family homes, to condos to apartments, all of which are suitable for those seeking to relocate permanently in Cabo San Lucas or San Jose del Cabo, wanting to buy a vacation home or looking to invest in property to rent. For almost every kind of vacation homeowner, there are many different options available in Cabo.

The Real Estate Market in Cabo

Over the last 5 years since the economic slump, most real estate ownership opportunities in Cabo have been re-sale properties, however, we are seeing a rise in new properties coming on the market as developers are building again. These new homes are attracting a different type of buyer looking for properties that are smaller and more cost effective. Most people looking for ownership opportunities in Cabo are looking to purchase something new, so this is a good time for the real estate market in Cabo.

Second home ownership in Cabo

Second home ownership in Cabo is very appealing for those wanting a vacation home to bring coworkers, family, and friends. You can come anytime you want and use it anytime. There really is nothing like owning your own place. However, remember that when you purchase a second home, you are responsible for all repairs and maintenance, so this will require that you hire someone to take care of your vacation property like a property manager.

Is it safe to buy in pre-sale in Cabo?

Unfortunately, there are downsides to purchasing a new product as you really don’t know what you will end up with and the risk that the developer actually finishes the project is very real. Nevertheless, you can get a great deal when buying during the pre-sale stages, meaning that your profit is much greater. Likewise, when purchasing a brand new property in Cabo, you can be sure that the designs are modern, built with the latest building products and ready to use.

How about building your own home?

It may be safer to purchase a property that has already been built, but there is something magical about building your own home, because you will be involved in the design, so you know what you are getting. Speaking Spanish will help you in this process but it not essential if you work with a reputable architecture firm and construction firms.

Condominium Living

Condominium living is the first choice for most people wanting a second home in Cabo. It is just easier, because you can maintain a condo with ease, then when it is time for you to return home you just lock up the condo and go home. However, there will be neighbors you will have to deal with. Neighbors could be on both sides of you or below or above you, so think about this when you are picking a condominium. You also are responsible in the upkeep, repairs, and maintenance on the condo inside, although the common areas are maintained with your HOA fees. An added plus to condominium living is they stand tall, so you will have great views.

Read: How to choose the best Real Estate in Mexico
Tips for Moving to Mexico

Tips for Moving to Mexico

Relocating to Mexico is going to be an ideal life-changing decision. Your future here will be more promising and fulfilling for sure. But before moving ahead with your relocation to Mexico, it is helpful to be more familiar with the different things related to your move to ensure a smooth transition. Here are our top tips for moving to Mexico:

Visas and Immigration Requirements

For foreigners who want to work and live in Mexico, you need to have a visa before you can proceed with your relocation. If your job is lined up in Mexico, you still will have to start the immigration process in your home country. Retirees who plan on moving to Mexico can enjoy slightly less-complicated procedures which only require proof of your regular income through pension, although you will also need to start the procedure while you are outside of Mexico. If you want to come and live in Mexico on a temporary basis, less than 6 months a year, you can do so by simply filling out the tourist card on the plane. However, remember that in order to be able to get a phone contract, electricity etc in your own name, you will need to show proof of your immigration status.

Mexican Peso

Mexico’s currency is the Mexican Peso $MN. This is the official payment in almost all transactions, although dollars are acceptable in many accommodations, restaurants, and other tourist destination establishments. High-value goods may be advertised in dollars, like properties, cars, and art pieces, but purchases are usually in pesos using the current exchange rate. Moving to Mexico will mean that you will have to start getting used to the new currency.

Health Benefits

Mexican employers make sure that their employees pay social security quotas for basic government services such as healthcare. There are many instances when foreigners are encouraged to avail of private healthcare insurance instead. The advantage of private healthcare service is access to better and more modern facilities. You will also find that health insurance is not so expensive in Mexico, making moving to Mexico a more economical option for some people.

Schooling

For those moving to Mexico with young children, you may be concerned about the education system in Mexico. Your children may choose to attend the public school system which is provided for free in Mexico. However, standards may be incomparable to that from you home country’s education. Most foreigners would rather choose the private schools, especially for those who are already earning professional wages in Mexico. Mexico’s private education are ideal for bilingual children and provides better facilities and standards for your children.

Owning a Property

Mexico offers similar procedures for buying property like that of Canada and the United States. There are restrictions, however, when you buy properties within 50 km of a beach or a border. If your choice of property is within these zones, you have to get a fideicomiso trust which is available from the local banks before you can make your purchase.

Taxes

Working in Mexico or running your own business means you are required to pay taxes. You do not have to worry about double taxation since Mexico has agreements with many countries which benefits foreigners by making sure that they only tax in one country. The best thing to do regarding taxes is to consult your tax adviser in your home country before relocating to Mexico. VAT tax in Mexico is around 16%

Car Insurance

It is illegal not to have your car insurance in Mexico. It is also required that you have at least the minimum coverage in case of injury or death of a third party. It is also highly recommended, although only optional that you avail of property and health insurances.

Choosing your Destination

And lastly, part of the joy of moving to Mexico is being able to live in some of the most beautiful places in the work at affordable prices. Many foreigners choose stunning sunny beach locations like Cabo San Lucas, Riviera Nayarit, Puerto Vallarta or Cancun, while others want to live in more temperate climates inland like San Miguel de Allende, Lake Chapala, San Cristobal de Las Casas. Whatever your preference, moving to Mexico will be one of the best decisions you will ever make.

really Cost to Own a Property in Mexico

What does it really Cost to Own a Property in Mexico

The value of your property in Mexico lies not only in the obvious benefits you get from it but also the lower prices of real estate and upkeep when compared to its counterparts in Europe, Canada and USA. Plus, comfortable weather, great-tasting food, and a relaxing lifestyle give more value to your money than in any other place in the world. Property maintenance, taxes, and housekeeping services are cheaper in Mexico and go a long way to making life far more comfortable.

When you purchase property in Mexico, consider these direct and indirect costs:

Home and Contents Insurance

An important consideration when you own property in Mexico is insuring your home. This covers both the house and its contents. Beautiful properties built along coastal areas and areas prone to flooding should take out specific insurance policies to cover such unlikely events.

Cost of Real Estate

As in any country, the bulk of your expenditures will go to the actual cost of the property in Mexico you are buying. Mexican properties vary in costs depending on the location, size, and amenities.

Taxes on Property in Mexico

You will need to take into consideration the annual tax on property in Mexico called “predial”. Depending on the size and location of your home, these property taxes may differ in various states although the usual amount is only a few hundred dollars. There are some areas where you will not receive a bill in the post or a reminder, so make sure you know when this payment is due, which is usually done in the local mayor’s office.

Real Estate and Agency Fees

Investing in a Mexican property has also additional charges which you must consider in your over-all investment. Fees such as: notary fees, sales taxes, and agency fees as well as other lawyer’s fees must be paid.

Fideicomiso – Bank trust for your property

Fideicomiso is a special land trust from a bank for foreign residents who would purchase a property within specified locations like within 50 km (30 miles) away from a Mexican coast or 100 km (60 miles) from any border. Depending on your property, an upfront fee followed by a yearly payment ranges from about US$500.

Electricity and Gas

The cost of services is higher in Mexico comparing it to the average person’s earnings. Gas and electricity costs may seem lower than those in the northern border. It is good to note that the more electricity you consume, the energy units become more expensive. Government subsidy is provided as long as you don’t go beyond your “allowance” or the responsibility of paying the full electric bill is yours.

HOAs

When budgeting for your home costs for a year, remember to include the HOA’s fees and other subsequent payments. This is relevant for any gated community, similar to buying a condo, an apartment, or living within a golf or country club.

Feel free to add any costs related to property ownership in Mexico that we may have overlooked.