How Foreigners can get Titles in Mexico?
Kenneth Huseman gives you the information you need to know if you are considering purchasing property in Rosarito Beach Mexico
U.S. Citizens can own property in the restricted zone which is all about Baja California essentially and I want to say right off the bat that the 99 Year Lease is it just not true, that’s a false thing, it was made up by the media. Nobody has a 99 Year Lease and the only Legal Lease in Mexico is a Ten Year Lease.
What is a Bank Trust and what it is used for?
Bank trust is essentially a way for your assets to be protected, so you form a trust and you put your assets in this trust and then you make instructions on what happens to these assets.
How does a Bank trust work?
When you have a trust, it’s a way for your heirs to receive the assets in the trust, and they don’t have to go through probate or anything like that to get these assets, so it’s just a way of protecting your assets when you pass away, and that’s essentially what they’re used for in the United States, but here you form a trust, so that you’re not really the owner of the title but you are the owner of the trust.
How common are these trusts?
Here in Mexico is the only way to own a property as a foreigner, you’ll hear of other ways to own properties, such as land leases and a Ejido land, but you’re not really the fee simple title owner of the property that way.
Are this trusts recommended as a secure way to own property in Mexico?
It’s the only way that foreigners can own property here in Mexico, if anyone tells you differently then it’s just not true and again, going back at the 99 Years Lease, that it doesn’t exist and everybody talks about it but it’s just not the way. So you have to go through a Bank Trust, it’s called Fideicomiso here in Mexico and it’s the way that all foreigners own.
What is a Fideicomiso and how does it work?
Is a Bank Trust, Fideicomiso here in Mexico is administrated by a bank, and so the title will go into this trust and you will be the beneficiary of that trust.
Are there different options for Fideicomisos?
No, there’s different providers of bank trusts and essentially the bank is administrating the trust they create the trust and they administrate the trust, so once you decided that you want to purchase property here in Mexico, you go to one of these banks, any of the banks here in Mexico can create the trust and they will administrate the, trust the title goes in that trust it’s not an asset of the bank so if something were to happen to the bank then that trust would transfer to another bank and they wouldn’t administrate the trust. The trust is good for 50 years and it’s renewable for another 50 years.
What are the costs for Fideicomisos?
The cost can vary, but essentially the cost for setting it up is $2,000 USD and the annual cost is $500 USD, the annual cost includes TAX, so it ends up being around $580 USD.