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MEXLAW > Uncategorized  > Enlist the Professionals to Guide You Through the Sale of Your Mexican Property

Enlist the Professionals to Guide You Through the Sale of Your Mexican Property

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There are numerous articles explaining how foreigners can purchase property in Mexico, but what happens when foreigners want to sell a property in Mexico?

If you have decided it is the right time to sell your Mexican property, do your research and find out the current market price for similar properties in the area. Search the internet for comparable listings and then consult with a licensed real estate agent.

Get recommendations for local real estate agents from friends or other expats, check out their website, find out which other ways they market their listings, are their listings seen internationally? Within the expat communities, it is relatively easy to find out about an agent’s reputation, good or bad it is also a great source for getting recommendations.

The main reason we suggest listing your property with a Realtor is that most people, especially foreigners, feel more comfortable contacting and negotiating with a real estate agent over the owner of the property.

As the seller, you will be responsible for the agent’s commission which will vary between 4% and 8%. Negotiate these important details before hiring the agent; confirm the commission fee, the duration of the listing, how will the agent be advertising your property and of course the listing price of your property.

Which costs are the Seller’s responsibility?

  • The agent’s commission plus an IVA (sales tax) on that commission.
  • Property Capital Gains Tax if the property was not your primary residence for a minimum of two years.
  • Legal counsel, it is recommended the seller also hires an attorney since the Notary does not represent either the seller or the buyer. Your attorney will review the offer, conditions and the deed of sale.

If the property was used as a rental, or part time vacation home there are couple options regarding assessing the tax and deductions, consult a tax attorney at MEXLAW to take advantage of the best options.

Which costs are the Buyer’s responsibility?

The buyer pays the closing costs in a real estate transaction; the buyer is responsible for the acquisitions tax, Notary fees and expenses, and their legal fee. Most lawyers will provide an estimated closing cost before the sale completes.

Selling a property under Fideicomiso

If you are selling your property to a foreigner, you may sign over the trust through the bank. They may continue with the trust in place and renew it when it expires, or start a new trust on their own.

Mexican Nationals do not require the Trust when buying real estate.

Full Disclosure, be sure to tell your realtor if there are any major issues with your property, for example, septic or plumbing issues, leaking roof, or liens on the property. Should these problems come to light during the inspection or title search the sale will be terminated. Any issues within a condominium unit and complex should be recorded in the meeting minutes.

How do the two parties manage, the deposit and payment?

The deposit and the payment should be held by an insured Escrow service with the funds held in a Canadian or American bank.

The real estate agent will require the following documents;

  • A copy of the Fideicomiso or  Title Deed.
  • A copy of the Legal Entity documentation and two pieces of ID (Passport and Driver’s License) of the authorized partners. Or In the case of an individual owner, two forms of proper ID (Passport and Driver’s License).
  • Utility Bill as proof of the seller’s residence.
  • Copy of the last Predial, Property Tax receipt showing paid in full
  • A copy of Bank Trust Fees paid to date.
  • HOA receipts as proof as paid to date.

MEXLAW is a full-service law firm experienced in Mexican law and guided by international standards, offering step by step guidance through any real estate transaction.