| Buying Mexico real estate is easy for foreign buyers |
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By bill mabra Mexico is a great place to vacation as it is very close to the United States and Canada by plane and the climate is warm when it is very cold everywhere else. Many people have been to Mexico at one time or another, maybe college spring break or a honeymoon perhaps. Many people see homes and condos for sale in Mexico and really want to know how they can own that property. Back when I was a tourist in Mexico I had the very same questions. It is very important to learn the laws and dispel all the bad information. Of course lots of misinformation is available about property ownership in Mexico. A lot of this stems from people not having all the facts or someone heard from someone etc. etc. We all know how those things work through the grapevine. First, once your home or condo is legally titled no one and I mean no one can take it away from you. People from all over the world buy and sell property in Mexico every
single day legally and without problems.You just simply have to know the laws. According to the Mexican constitution a foreigner cannot title any property that is within 100km of any border or 50km of any coast in their name. That doesn't mean you cannot own it, it means you have to title it differently than you would if you were in the interior of Mexico. In the interior you can buy property as you would in the U.S. or Canada. It can be titled in your name with no problems at all. If you want a home or property in mexico that is within 50km of a beach then you have two choices.
First choice is setting up a Mexican corporation or an S.A. de C.V. This is very much like an LLC corporation in the U.S. It is primarily for sole proprietorships and small to medium business. That business then in turn can purchase property and hold title to the property in the business name. You need two people that are 18 or older to sign up as principles of the corporation. The nationality of the two people doesn't matter and you can split the ownership of the company any way you like. For example each person is 50% owner or one can be 99% and the other can be 1%. In order to title your property in a business name you have to show that either you are doing business with that property OR that you have the intent to do business. An example might be if you bought a building and downstairs was a restaurant that you rented to someone and upstairs was a condo and you lived in it. Something like that would work, but be aware if the tax/real estate authorities ever choose to investigate your property and they find that it is primarily for residential use only? They can slap you with a pretty hefty fine. Option number two is using a bank trust and holding the title of the home or condo in that trust. The word for this trust in Spanish is fideiocomiso (fee-day-ko-me-so). The title is held in trust with the bank and you are named as the trustee granting you (could be you and your spouse) the power to make any and all decisions regarding the home. In this way you and only you have this power over the trust so for all intents and purposes you are the owner legally. You would want to use the bank trust unless as stated earlier you are buying a building or area that includes commercial property in Mexico. Of course when you speak to your agent and your attorney in Mexico they can drill down to a lot more detail on the foreign buying process with the details but this is just a basic article about people from other countries purchasing Mexico real estate. You can see more at www.cheapmexicorealestate.comMexico is a great place to vacation as it is very close to the United States and Canada by plane and the climate is warm when it is very cold everywhere else. Many people have been to Mexico at one time or another, maybe college spring break or a honeymoon perhaps. Many people see homes and condos for sale in Mexico and really want to know how they can own that property. Back when I was a tourist in Mexico I had the very same questions. It is very important to learn the laws and dispel all the bad information. Also, there are plenty of rumors flying around about how the government can take away your property or how corrupt things are in Mexico it goes on and on. There of course are also rumors that foreigners cannot own a property in Mexico. Nothing can be further from the truth. The government cannot take away your legally titled property once it is registered with the public registry. Also, foreigners can and do own homes, land, condos as well as commercial property in Mexico every day.As i said before it is important that you understand the legal aspects of the buying process in Mexico for non Mexican nationals. The law in Mexico states that non citizens of Mexico cannot legally hold title in their name of anything within 50km of the coastline or 100km from the border. Foreigners of course can still buy and sell property in those areas but legally they have to do it a little bit differently than in the interior of Mexico. This is known as the restricted zone. In other areas foreign buyers and title property just like they would in their homeland in their name. Actually there are two options for owning a home in the restricted zone for foreigners. First choice is setting up a Mexican corporation or an S.A. de C.V. This is very much like an LLC corporation in the U.S. It is primarily for sole proprietorships and small to medium business. That business then in turn can purchase property and hold title to the property in the business name. You need two people that are 18 or older to sign up as principles of the corporation. The nationality of the two people doesn't matter and you can split the ownership of the company any way you like. For example each person is 50% owner or one can be 99% and the other can be 1%. In order to title your property in a business name you have to show that either you are doing business with that property OR that you have the intent to do business. An example might be if you bought a building and downstairs was a restaurant that you rented to someone and upstairs was a condo and you lived in it. Something like that would work, but be aware if the tax/real estate authorities ever choose to investigate your property and they find that it is primarily for residential use only? They can slap you with a pretty hefty fine. Option number two is using a bank trust and holding the title of the home or condo in that trust. The word for this trust in Spanish is fideiocomiso (fee-day-ko-me-so). The title is held in trust with the bank and you are named as the trustee granting you (could be you and your spouse) the power to make any and all decisions regarding the home. In this way you and only you have this power over the trust so for all intents and purposes you are the owner legally. You would want to use the bank trust unless as stated earlier you are buying a building or area that includes commercial property in Mexico. There are a few more things to know about this process when purchasing but this gives you a high level overview of how it works. staff writer from Riviera Maya real estate news http://www.cheapmexicorealestate.com |