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If you are a foreigner and you have decided that owning a property on Mexico’s beautiful coast is something that you really want for your retirement, second home or purely for investment, the Mexican constitution requires that you acquire the property through a real estate trust. This trust mechanism is called “fideicomiso” and it is the only way to purchase residential property within a so-called restricted zone (50km/31 miles from the coast and 100km/62 miles from the Mexican border) and this mechanism has been practiced in Mexico for over 30 years.
Buying a property via a fideicomiso is a very safe and easy-to-follow process. We, at Vistas de la Marina are ready to assist you in acquiring property in Mazatlan and will help you at every step of the process if you decide to become an owner in our community.
Generally speaking, you as a buyer are the only beneficiary of the trust. The bank is the administrator of the trust and it is responsible for making sure that you pay your yearly trust fees. The bank does not hold the title to your property as its own asset and therefore, if you consider the worst case scenario of the bank going bankrupt, your trust is simply passed to another banking institution. Other characteristics of the trust are:
- You are required by the Mexican law to nominate a beneficiary (can be more than one) of your trust in case you die. The Mexican government assures this way that your property will not become a burden on the government in the future as it is only you and your beneficiaries, who are allowed to live, renovate, rent, sell, and nominate inheritors to this property. Without the beneficiary’s consent (or death of all beneficiaries), the government is unable to commercialize your property.
- Asset protection — nobody is able to put a lien on a property that is placed in a trust
- SRE permit — this is a permit (which is a form of a guarantee) issued by the Mexican government that gives you a 100% assurance that the Mexican property you are buying is free of any liens and has a clear title.
- The title is issued for 50 years and it is automatically renewed after this period ends. If you are late with your payments or submitting a letter to extend the trust, you will be charged with late fees as a penalty.
- There is a yearly fee to operate a real estate trust in Mexico and it amounts to approx. US$400 per year.
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