Vacation Rentals Listed by Owner in San Miguel de Allende

 

Legal information regarding buying Real Estate in San Miguel de Allende

 

Anyone purchasing property in San Miguel should consult professional legal advice before completing a transaction. Typically, the cost of hiring legal counsel is small in comparison to the total dollars invested in most real estate transactions. Legal advice has value both in the purchase process itself and also upon sale of such property in the future. Knowing that your transaction has been completed properly -- and all paperwork is in order -- will ensure you can fully enjoy any property you choose to purchase in Mexico.


It should be noted that all real estate transactions in Mexico requires the involvement of the notario publico. The notario publico has significantly more experience and responsibility than a notary public in the United States and thus the two should not be confused. A Mexican notary is an attorney duly authorized by each State to attest and certify that the transactions performed in his or her presence complies with all the statutory requirements and, if applicable, to withhold the appropriate transfer taxes.

 

Financing and Taxes

Mexico's real estate marketplace continues to attract big name players from the United States. GE Capital is one major institution that provides financing for Mexico real estate purchases. Since real estate financing is somewhat new in Mexico, the fees and rates are often higher than what you would expect in the United States or Canada. Certainly, financing finally makes it possible for many people to now make a real estate purchase in San Miguel.

Mexico has a provision in its tax code for primary residents -- which can include U.S. citizens -- which is quite similar to capital gains provisions found in the United States. Purchasers are encouraged to explore this provision, as it will have an impact down the road at the time of sale.
 

Title Insurance & San Miguel Mexico Real Estate

Title insurance is not required when making a real estate purchase in Mexico, but it is recommended by some professionals. Stewart Title is active in most regions of Mexico. You may wish to explore whether additional "name" title insurance companies are active in the areas where you might make a real estate purchase. The process followed by major title companies is very similar to how these companies operate in the United States.

Should you choose to have title insurance on the property you purchase in Mexico you will need to provide the deed -- called the "escritura" -- to the property along with a certificate of no liens to the title company. A full title search will be performed on the property and a title commitment issued. The title commitment will show the items that will need to be addressed in order to actually secure title insurance.

In Mexico, title insurance is issued after the closing. Specifically, the necessary documentation required to be included in the title policy does not occur until after the closing has taken place and the deed is recorded. However, coverage typically occurs at the time of payment of the premium, as long as the initial commitment letter has been issued and any outstanding issues have been resolved.