Based on direct input and feedback from U.S. retirees that have purchased homes in Mexican coastal communities:
- Do your homework before buying. Familiarize yourself with Mexican laws and regulations, which are quite different than the laws of the United States. Don’t assume that laws are uniform across Mexico as real estate conventions, laws and costs for closing vary on a state-by-state basis, just like in the U.S.
- Make sure that you have been provided all pertinent disclosures specific to the property you are purchasing including non lien certificates, proof of property tax payment, condo regime documents, legal suits or other legal actions that might otherwise impact your property title.
- In coastal areas, make sure that the property you are purchasing is in a development that is in compliance with the Mexican Federal law for mangrove protection to avoid possible legal actions.
- Make several trips to your retirement destination of choice before making a decision to buy.
- Don’t try to do a deal on your own. Retain licensed Mexican and U.S. real estate agents, attorneys, and accountants.
- Get title insurance. Make sure the seller has clear title.
- Require that all documents to be translated into English and read them carefully.
- Place deposits in a neutral, third-party escrow account.
- If you own coastal property in Mexico through a
Fideicomiso, your trust must be reported to the U.S. Internal Revenue
Service to avoid potential tax penalties. For additional details on IRS
rules and guidelines on foreign trust reporting requirements please
refer to:
http://www.irs.gov/businesses/international/article/0,,id=185295,00.html - As in any country, including your own, if it is too good to be true, it probably is.
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