Found My Dream Home!

Now what?
BY: DARREN DEEDS

Make an official offer. While Mexican law recognizes verbal agreements, both the offer and acceptance should be made in writing, ensuring no confusion on terms and conditions. Your offer should be sent in the form of an “Offer to Purchase” contract, detailing the main terms of the sale, including price, payment plans, details on an earnest money deposit, and a deadline for the seller to accept the offer.

Make sure all offers are recorded in writing to eliminate any misunderstandings or confusion

As soon as the seller has accepted your offer, an earnest money deposit must be made. Look out here, an escrow account is called for, an American bank so much the better. You should include a clause in the offer that guarantees the deposit if either a promissory agreement or a final sales agreement isn’t executed in a certain amount of time; also note who received the deposit. If the seller requires it to be non-refundable, make sure it’s not more than you’re willing to lose.

Once the deposit is made, the promissory agreement (contrato de promesa) will be drawn up, binding both buyer and seller into a timeframe to execute the purchase contract. Having this in place locks in the basic terms of the offer while you and the seller track down all the paperwork you’ll need to complete the purchase contract—which can take some time. It also allows time for both parties to work out the details for the final purchase contract.

Under Mexican law, both parties are bound by the terms of the promissory agreement—if all the terms and conditions are met to execute the purchase contract, neither party can back out of the sale.

Once the promissory agreement has been signed, the seller contacts your bank (the one you used to set up your fideicomiso) to initiate the trust application. Your attorney then orders a trust permit from the Ministry of Foreign Affairs.

During this time, your lawyer should also be verifying the legal status of the property, including review of title, confirming that the seller has the right to transfer the title, and reviewing the terms and conditions of the purchase contract. He’ll also need to request documentation from the seller, such as the certificate of no encumbrances, a certificate of no tax liability, and a property appraisal.

The documentation required from the buyer is minimal—all you need is a copy of your passport and driver’s license, a recent utility bill showing your name and home address, and corporation documentation (if applicable). These are presented to a notary and are filed at the public registry.

If everything is in order, the notary and your attorney will work with the bank to have the trust documents drafted and finalized.

At this point, both parties should be able to execute the purchase/sales agreement (compraventa), start the closing process, and transfer title of the property to the fideicomiso.

By this time, the bank trust office should have received the trust permit from the Ministry of Foreign Affairs, and your attorney will be able to start the drafts for the closing deed. Your lawyer, a notary, and a bank trust officer will then review the final draft of the deed.

Once everything has been verified as correct and all the closing paperwork is ready, you’ll be notified of a closing date and the final closing costs due. At closing, the final deeds will be signed, final payments settled, and the property title officially transferred to your bank trust.