buying property in mexico
Mexican Property Trusts
In 1994, amendments to the Mexican Constitution permitted foreigners to purchase and own real estate in Mexico located within the "restricted zone" which is all land within 60 miles of a national border and within 30 miles of the Mexican Coast. This Law permitted ownership through a land trust or "Fideicomiso". The fideicomiso, or bank trust, is the vehicle for foreigners to acquire ownership rights to property for a period of 50 years and is renewable in perpetuity. The fideicomiso is a legal substitute for fee simple ownership.
A "Fideicomiso" is a Mexican Trust. The way it works is the Mexican Government issues a permit to a Mexican Bank of your choice, allowing the bank to act as purchaser for the property. The bank acts as the "Trustee" for the Trust and you are the "Beneficiary" of the Trust. The "Beneficiary" rights are very similar to Living Wills or Estate Trusts in the U.S. A trust is recognized world wide as the highest and most protective legal document that can be invoked. Many Mexican nationals prefer to utilize the fedeicomiso (beneficiary trust) as their form of ownership not only because of the legal protection it provides but also because it is much easier to transfer title if and when the property is sold.
As trustee, the Mexican bank acts on behalf of the foreign beneficiary in transactions involving the property held in trust. However, the beneficiary retains the use and control of the property held in trust, and enacts the investment decision with respect to the property. The trust is NOT an asset of the bank. The beneficiary has the right to use, lease, improve or sell the property without restriction, to transfer his rights to a third party, or to pass the property on to named heirs. In essence, the beneficiary has the same absolute rights to use and enjoy the property as if it was fee simple ownership.
BajaModern has already established the Fedicomiso for every property it
is developing. New owners purchasing property from BajaModern do not need
to reestablish the Bank Trust only a simple reassignment of the Trustee
names is required. Please contact us for additional information on the fees
and process required to establish a Fedicomiso if you choose to purchase
your own property in Mexico and utilize the architectural design and engineering
services provided by BajaModern.