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FAQ

Here we answer the most common questions we receive. Is yours not in it? Please feel free to contact us!

In the ‘restricted zone’ of Mexico (100 kilometers from the border and 50 kilometers from the coast) a foreigner may purchase real estate only by means of a Fideicomiso, commonly called a Trust. The Fideicomiso is a 50-year, renewable bank trust granting a foreign Buyer the right to use, enjoy, improve, rent, sell or otherwise enjoy the property. The foreign Buyer is called the Beneficiary of the Trust. As the beneficiary, you retain all ownership rights and responsibilities to the property and have the right to sell, lease, improve, mortgage or will the property to your heirs. Essentially, the beneficiary of the property enjoys all the rights he would if ownership were fee-simple. The parties involved with a Fideicomiso are: The Trustee, (The Fiduciario, Bank or Trustee), the Purchaser (The Fideicomisario or Beneficiary) and the Seller (the Fideicomiente).

Yes. The Buyer may elect to be assigned the rights of the Seller’s existing Trust. Typically, this is done if there are a substantial number of years left on the Sellers Trust. This process is called an Assignment of Rights (Cesion de Derechos). During the Closing Process, a Notary may recommend this process based on the number of years left on the Seller’s Trust.

Currently a Fideicomiso is issued in 50-yr increments which can automatically be extended by an additional 50 years at the end of that term. Under current Mexican law, at the end of the combined 100-yr term, you will need to apply for a new foreign affairs permit to extend the term.

The Fideicomiso is drafted and executed in Spanish; however your final closing package will include a certified translation of this document in English for your closing files.

Since the incorporation of the trust, or the appointment of Beneficiaries under a trust, the primary beneficiary can appoint beneficiaries in case of death. In this case they will just have to prove to the Trustee Bank that the Estate proceeding in the country of origin has started and that in the will of that person no one else was appointed as a new beneficiary.

The Trustee bank is the Mexican Bank authorized to act as Trustee (Fiduciario). The Trustee Bank must be a Mexican registered financial institution with an established trust department. It is worth mentioning that the properties held in trust are not assets of the bank and size of the bank is not necessarily a sign of better trustee service.

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