For the past few years, American buyers have been showing interest in buying a second home in a foreign country with Mexico being the top of their preferred countries. The reason could be the mesmerizing charm and beauty of the country or the convenience for Americans to buy properties and settle down in that country.

Whatever the reasons are, purchasing a second home or making real estate investment in Mexico, especially in Sonora, has become a real deal. Whether you want to enjoy the surf and turf in Puerto Peñasco or the serene, quaint atmosphere in Álamos, you must know the prerequisites for purchasing a home in that country.

Let’s take a look at our 10-point checklist for purchasing your second home in Mexico:

Location of the Property

Foreigners can purchase virtually all types of property in Mexico but you’ll need to use fideicomiso or bank trust when buying property within the restricted zone, consisting of all of Baja California and properties within 31 miles of any coastline and 62 miles of Mexico’s natural borders.

Fideicomiso or Bank Trust for Restricted Zone Property

As a foreign buyer, you can buy a restricted zone property through a bank trust or fideicomiso. In this process, bank will hold the legal title of the property, you’ll be the beneficiary of the trust, and the trustees will manage the property according to your instructions, i.e., whether to renovate, rent, or sell it.

Professional Advices

Considering you’re not an expert in Mexican real estate industry, it makes sense to take professional and legal advices from a real estate agent, a title insurance company, and consultants about your preferred location, the property you are going to purchase, and the type of transaction you are considering.

Be careful while choosing real estate agents because they are not strictly regulated by the government. There’s a voluntary agent “registry” in the Sonora state but it’s nothing like mandatory licensing.

Hire an Attorney

It’s preferred if you get the advice and services of a U.S and/or Mexican attorney, who will be legally responsible for representing and protecting your best interests. However, don’t forget asking them about their experience and success in representing foreigners purchasing property in Mexico.

Written Purchase Contract

A written purchase contract (in both English and Spanish) contains the details and contingencies of your agreement with the seller and provides certain legal protection for your purchased property. There will be a preliminary agreement called oferta and then the promissory purchase-sale agreement, which will set forth the terms and conditions of the transaction. So, before signing the deal and making a down payment, don’t forget enter into a contract with the seller.

Bank Trust Contract

It’s the last step of the purchase-sale agreement. You have to execute the document on the presence of a notary public or your attorney. If you choose the latter option, your attorney will have the authorization to close the transaction on your behalf.

Notario Publico

A notario publico will close your transaction given that all the required documents have been prepared and produced before him. He will also register the deed in the Public Registry off Property, which may take weeks depending on the location.

The Type of Land

Make sure your chosen property is an ejido or communal agricultural land. In this case, you can only purchase and use the land but won’t be the owner of it.

The Fees

As a buyer, you have to pay different types of fees at various points of transaction. Make a list of them and make sure that you’re capable of bearing all the costs. The fees generally include bank trust, attorney, real estate agent, notario publico, appraisal, title insurance, transfer taxes, deed recording, and property taxes.

Ask Questions

Mexican consumer protection laws are not that much strict or all-inclusive. So, it’s your responsibility to become an informed buyer. The simple rule is if you don’t know, ask and if you don’t like the answers, don’t sign.

You can also take initiatives and make a trip or two to your chosen location to have a general idea about the area. Check out the availability of all the facilities and services and take your decision on that basis.