Invest Mazatlan - Real Estate & Mortgages in Mazatlan, Mexico

A: Yes. Mexican property can be considered as a second home, thus interest & property taxes are deductible on U.S. returns

A: No. The bank trust operates much the same way as a U.S. bank trust does. The bank only holds the trust for your ownership and protection under Mexican law. It does not own the trust. The bank serves as the owner’s employee. It operates solely under the instructions of the owner of the trust. It can be bought, sold, inherited & willed. The Fideicomiso acts much the same as a Deed of Trust does in the U.S. providing equity ownership.

A: No. Under a bank trust. the beneficiary (buyer/owner) has all the rights of ownership: the right to use, borrow money on, make improvements on, and transfer. A lease grants only the right to use. If the tenant makes improvements, such as building a house on the property, that house belongs to the landlord, nor can the tenant sell the property or borrow money on it. A lease cannot contain provisions for future renewals whereas a Fideicomiso is guaranteed renewable into perpetuity.

A: The sale is legally finalized when it is witnessed through a Notario Publico in Mazatlan. From there it passes to the authorized Bank for the Fideicomiso ownership. The bank then reviews all the necessary documents and once satisfied that the subdivision is legal, issues the Fideicomiso. This is a long and detailed process, and can take months to complete.

A: Yes. For instance Stewart Title provides title insurance for Mexican properties

Q: Is there escrow in Mexico to hold the deposit of funds required in my purchase agreement?

A: Yes. Escrow is highly regulated in Mexico, and certain Mexican banks are permitted to hold your money as a third party. Some US title companies may also be granted permission to escrow deposit funds on behalf of a buyer and seller in regard to Mexican real estate.

Q: Is a person selling a Mexican property (not a primary residence) for a gain liable for both U.S. & Mexican capital gain taxes?

A: There is not double taxation. Generally, a person will get tax credits on his U.S. tax return, for Mexican taxes paid.

A: No. Non-nationals often worry about land being expropriated by The Mexican government. By Mexican Law and as agreed to through NAFTA, Mexico may not directly or indirectly expropriate property except for a public purpose (identical to eminent domain in the U.S.) When it is necessary to expropriate, swift and fair market compensation must be paid together with accrued interest.

A: No. The Mexican government formed the Fideicomiso for foreigners through constitutional law and provides them, under the Mexican Constitution, the same legal rights of ownership as a Mexican would have. Secondly, the N.A.F.T.A. Treaty (1994) between Canada, Mexico and the U.S. further put in place many requirements, including security provisions that prevent any of these governments from arbitrarily seizing land from the rightful owner.

A: No. In the past, a corporation or partnership had to be owned with a Mexican partner who owned at least a 51% interest. This is no longer the case. Now, a Mexican corporation can be 100% foreign owned and is able to buy property for business purposes with fee simple title even in the restricted zones, under the Foreign Investment Law of 1993.