| Dear potential buyers, please read carefully and print, if you can, this important message that will help you better to understand some simple but very important steps that you need to take in order to be ready to be ready to purchase property in Guanajuato, Mexico. Thank you ! Casas Eugenia Sales Team. The risky points: If you're considering the purchase of a property in Guanajuato, you will need to undertake extensive research, choose your location and property very carefully, and ensure that you hire a professional to represent you and to show reliable properties. Unfortunately, in the last years, many people pretend to work in real estate business but most of time these people are unexperienced and unreliable persons that are just looking to make an easy profit. Please be careful of people that you meet on the street, in museums, hotels or other businesses that have nothing to do with a proper real estate agency. Craiglist is a wonderful tool but sometimes it help Individuals such as these, to hide their names and reputations, these Individuals can harm you and put your money and patrimony at risk. The real estate market in Guanajuato is simple but it is also something really serious. A well established realtor will be your guarantee that the property you are looking to buy is at a fair market price, has all the legal documentation and its free of leans and other legal problems that will make the sale illegal. Guanajuato has several natural reserves in which building is not at all allowed. These lands can have many restrictions. Many times, part time realtors will not know about these problems. So please be really careful. Select a reliable and well established realtor. Ask all the people you know about the reputation and professionalism of the person or company you will be working with. Guanajuato is a small city and bad deals and bad reputations are easy to discover. So please be really careful. Select a reliable and well established realtor. Ask all the people you know about the reputation and professionalism of the person or company you will be working with. Guanajuato is a small city and bad deals and bad reputations are easy to discover. The positive points! Thousands and thousands of foreigners have successfully purchased land and property in Mexico. With the right Agent and the right approach, there is no reason why you should not become one of them if you want to! Mexican Law provides for private ownership of land by foreigners, and its law is very specific about the way in which land rights should be transferred from seller to buyer, and also what type of lands are not eligible for public ownership. A Notary Public (see below) will guide you through the details of these, but generally: • Property may be purchased and owned outright for residential use by foreign nationals outside of the 100km restricted land border zone, or outside of the 50km coastal zone; • Inside of the restricted border/coastal zones, foreign nationals may own land through a fidecomiso (a trust) which is set up through a bank and provides for ownership of the land and property in all but name. DOES NOT APPLY TO GUANAJUATO!!! You do not have to be resident in Mexico to own property there, so there is no need to qualify for resident status under immigration laws in order to have a property investment in Mexico. Mexican Law on property ownership is comprehensive and provides protection for the seller and the buyer in all property transactions, provided that the law is followed, and you ensure that all necessary documentation is present and that the procedures are adhered to. Your Notary Public (see below) is an important person in this process, and he/she will guide you. The Notary Public is the most important person you will deal with when you make a property investment in Mexico. Do not confuse the role of the Notary Public in the US or UK with its counterpart in Mexico: they are quite different. In the UK for example, almost anyone can become a Notary Public. Not so in Mexico, where the role is appointed directly by the State Governor (the highest seat in State Public Office). The Notary Public has the power to witness and certify important business documents which require absolute authenticity. The appointment also holds responsibility for the management and secure storage of original records. Notary Publics must be Mexicans of at least 35 year in age, they must have a degree in Law, have 3 year's work experience at a Notary Public office and they must pass a stringent exam. Those who pass, in time, are appointed as Notary Public by the State Governor. Under Mexican Law, the deed to the property must be prepared by a Notary Public. As a buyer, it is your right to choose the Notary Public, and it should be your first port of call - or second after your lawyer. The Notary Public will ensure that all documentation and permits are in order so that the transaction can proceed. Important! Everything official to do with your transaction should be done via the Notary Public: Do not take anyone's word about documentation (like property deeds) being valid - take copies to the Notary Public for official verification. A good lawyer will be able to advise you on such matters. The exact process will vary in each case, but you (or your Agent) will follow a process that goes along these lines: • Find a property you like; agree a price verbally; • An 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; • Next, you seek permission from the Foreign Secretary's office, a formality but it will cost you around 600 USD…its more like a Tax that the Foreign must cover in order to buy property in Mexico. • Get a copy of the Land / Property Deeds from the seller. The Notary Public will check these out. • An official appraisal of the Land (Avalon) needs to be carried out; your Public Notary will arrange this. • Your Notary Public will ask for official documents that can include (but are not limited to): Photo ID (passport) and your visa (could be a Tourist Permit) to prove that your stay in Mexico is legal; IMPORTANT: be sure that your Tourist Permit has the number of days that you will stay in Mexico. • 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 Agent 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. |
What you should know: Info for Buyers
Last Update JULY 2010
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