For years Americans and Canadians wanted to move to Mexico, but did not have enough cash to buy their desired home in paradise. Well, things have changed! Dealioz.com is now able to help offer financing to those who have some cash (20% down payment required). If you are still working we encourage you to buy now to have your property paid for (or almost paid for) by retirement. Attaining the "American Dream" is still possible! Imagine affording an ocean view home starting at $100,000.
Financing Real Estate in Mexico - Here's what you need to know:
Historically, due to lack of capital markets and high Mexican interest rates, most transactions were made in cash. Financing options with competitive interest rates and terms are now available from US and Mexican banks. Contact Dealioz.com for more details for a list of different financing options. Your loan well be funded by a lender, your credit is based on your US assets and secured by the home in Mexico. Each company has different requirements and terms, so we recommend you consult with the real estate professionals in our program for more details. The real estate industry in Mexico is developing quickly, taking advantage of today's technology, and becoming more similar to the industry as it exists in the U.S. The only national professional real estate organization in Mexico is the "Asociacion Mexicana de Profesionales Inmobiliarios" or "A.M.P.I." (Mexican Association of Real Estate Professionals), an organization similar to, and affiliated with, the National Association of Realtors (NAR) in the United States.Licensing of Real Estate Professionals in Mexico
Mexico has enacted a licensing law for professionals in the field of Real Estate. This is commonly known as the Diplomado. In Puerto Peñasco Diplomado Courses commenced in the summer of 2007. The Diplomado is a 100-hour course of study in Mexican Real Estate Laws and Commercial practices. After the student has satisfied the course requirements, he may then submit an application to the Economy Secretary of the State of Sonora, accompanied by finger prints, certificate of no criminal history, and a resume. If everything is in order, a Real Estate License will be issued. The license can be renewed annually only with continuing education. To find your dream home in Mexican real estate, whether for lease or for purchase, contacting an experienced reputable real estate company is advised. The purchase of any real estate, and particularly real estate in a foreign country, demands safe, honest, experience advice. Please don’t do in Mexico what you’ll never do in your native country!Escrow, Title Insurance and Home Insurance in Mexico
These concepts are fairly new within the Mexico Real Estate Industry, and are most commonly used within the restricted zones. Using independent escrow services gives both buyers and sellers the increased peace of mind that all appropriate parties will receive funds and titles within the guidelines set forth within the escrow agreement. These service companies have implemented processes and procedures mirroring the US title process. By offering Secure Independent Escrow Accounts, Title Processing, Title Insurance and Homeowners Insurance, buyers and sellers can now rely on these companies to ensure their transactions are conducted in a secure manner. You can be assured the closing process will be conducted in the safest manner possible, mirroring US practices through Title & Escrow Service Companies.Closing Costs in Mexico
It is common practice that the buyer pays the transfer or acquisition tax as well as all other closing costs, including the Notario fees and expenses, and the seller pay his capital gains tax and the broker's commission. On January 1, 1996, the federal law regarding the real estate transfer tax, which was 2% for the entire Republic of Mexico, was modified in order to allow each of the Mexican States to determine its own tax. The range may be from 1 to 4% of the appraisal value, sale value or city accessed value, (whichever is the highest). The rest of the closing costs, which exclude the transfer cost mentioned above, may vary from 3-5% of the sale value, or more as the price of the property decreases, and depending on the particular State and cost of the Bank Trust / Fideicomiso. There is a charge by the bank to the person desiring the Fideicomiso for the preparation of the agreement and establishment of the trust. In addition, the bank charges an annual fee to cover its services as a trustee.
Capital Gains Tax in Mexico
The concept of capital gains tax is applied differently than in the United States. The gain from the sale of the property is considered normal income, and is taxed at a rate of up to 28%. In order to determine the gain, the following costs and expenses are deducted from the amount for which the property is officially sold:
1) The original land cost and the depreciated construction cost, based on the number of years the property was held, and adjusted for inflation according to the official consumer price indexes.
2) Additions, modifications and improvements, but not maintenance, made on the property (construction), adjusted as above.
3) Commissions paid to real estate brokers by the seller.
4) The closing costs, including all expenses, taxes and fees paid by the seller. The Notario will withhold the calculated gain after deductions, and forward it to the Mexican tax authorities. The seller may then deduct this amount against their annual tax return, which becomes an adjustable tax credit in the United States.
With Dealioz.com's real estate partners guiding you, Mexican property ownership will be no more complicated for an American or Canadian than property ownership in your home country.