Did you know that when you plan to buy a property in Mexico, and the buyer is foreigner, the property must have a trust? Consequently the buyer or your real estate agent must request a notary to execute the process for a permit from the Foreign Affairs Office with the following documentation:

1.- Deed of the Property.
2.- General information of the buyers and the substitute beneficiaries- along with their id’s , such as their immigration form to credit the legal stay in the country.
3.- If there are more than two buyers, they must inform the regime in how they wish to obtain their Trust rights,  they can chose from Active Solidarity or Joined  solidarity.

ACTIVE SOLIDARITY

This regime means that the assigned trustee has the right to demand each and every one for the complete fulfilment of an obligation. In other words, the trustees may act as a group or individual, they can instruct the bank to transfer, sale or lien or dispose of the trustee’s rights. They can also grant powers with the obligation to only report to the others the acts that have been executed; the other trustees must respect them.

Most trustees chose this regime because it is very practical. However, the notary can limit the obligations acquired by clearly describing them in the Trust, stating that in case there is a transfer of domain all the trustees must be present.

JOINED REGIME

This means that when two or more people buy, they must agree on an undivided percentage within the trust, so each one of them is responsible of the share that corresponds to each one. In case they want to transfer it, they must respect the others rights.

SUBSTITUTE BENEFICIARIES

For both of the aforementioned cases, the trustee holders can assign each other as substitute beneficiaries in the first degree and assign trustees in second degree in case both die..

Another requirement the notary will make is to obtain the permit from the Foreign Affairs Office, this will include the property’s description.  In case the lot has more than 1999 m2, then it is necessary for the trustees to sign a Commitment of investment letter, where they indicate the amount and time they will require to execute the investment, following these criteria:

A).- from 2,000 to 3,000 m2,  the minimum invest is $250,000.00 USD no longer than a 24 month term.

B).- from 3,001 to 4,000 m2, the minimum invest is $300,000.00 USD no longer than a 24 month term.

C).- from 4,001 to 5,000 m2, the minimum invest is $350,000.00 USD no longer than a 24 month term.

For every 1,000 meters or fraction, it will increase to $50,000.00 USD, within the same aforementioned term.

Dear reader, I would like to present this general panorama with the sole purpose to help you find a guide and for you to be able to accomplish your transactions successfully, but if you still have questions on the buying regimes, then I suggest you talk to your notary or your attorney to give you further information.