You do not need a FM3 to buy property, although, it does help a little for capital gains taxes later on down the road if you sell.
You do not need a job for to have a FM3, in fact, they are two different things.
A FM3 can be had if you can prove you have the minimal amount of income to support yourself in Mexcio which changes every year or two, and is around $1500 USD per month, (this is a retirement FM3), although you need not be of retirement age.
There is also an FM3 for students, and one that you get if you are "sponsored" for working in Mexico, which also requires your working Visa to be attached to the FM3. If you leave the job, the FM3 is no longer valid and the law is you must leave the country within 3 days from termination, or start your own process of obtaining the FM3. You may also get an FM3 if you start your own business.
There is also an FM2, but you cannot file for one until you have held a FM3 for five consecutive years, or if you legally marry a Mexican National.
If you work timeshare, and leave the job, your FM3 is no longer valid..... without the FM3- you have to find a way to get out because you turn in your tourist Visa when you start the FM3 process. Some people switch to a new job, others go back home, and some drift.
Buying property in PV
Moderators:admin, Moderators
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Judimex
Re:Buying property in PV
I'm sorry that i can't make you feel better with words. I am not a realtor. I do not understand the situation. Where exactly is this development, in PV?melis (Aug 10, 2004 11:00 a.m.):
well you can buy property if you have an fm-3, which you will get if you have a job in mexico. that's my plan.
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Judimex
Re:Buying property in PV
Dear outraged. I would feel the same way if i experianced that kind of deceit. What i am saying is, one bad apple. . . You must have a notary involved with property purchases.north (Aug 10, 2004 09:17 a.m.):
Dear Judy--Here is another thought for you. All ten of the purchase contracts in this development were in default as of December, 2000. All ten purchasers are now four to five years late in taking delivery of their condos.
Since December 2000 two more AMPI realtors have listed units for sale in this development. How can that be? They know that ten contracts are in default and yet they are trying to sell more units?
The original two AMPI realtors who sold units to the ten of us called the development one name. The third AMPI realtor advertised units under a different name. The fourth AMPI realtor is now calling it a third name. What is the purpose of all these name changes?
There is am AMPI realtor (the fourth) who is advertising a unit for sale in this development on the internet right now. I suppose it is also offerred for sale on the MLS. Will prospective purchasers be warned about what has gone on in this development and the ten of us who have been to hell and gone with these developers? How do you think that makes the ten of us feel? If you want to talk about who is "outraged" I will be happy to tell you who is "outraged".
Re:Buying property in PV
I'm a Realtor in the US. In my area we've got our fair share of incompetent Realtors. Licensing alone CAN NOT turn an incompetent individual into a competent one! There will ALWAYS be idiots in this business, licensing or not.
I haven't purchased real estate in PV but am planning to in 6 or 7 years. My advice to anyone planning to purchase real estate anywhere (but especially in Mexico) is this ...
First, understand the process. by reading all of the articles you can find on the ins-and-outs of the process. Many of the broker's web sites for PV real estate explain, in great detail, how the purchase process differs from what we in the US (and probably Canada) are used to. Make yourself a "checklist" of the steps you'll need to go through.
Second, interview agents. In my humble opinion, it is not absolutely necessary to find an agent that has 10 or 20 years of experience. In fact, sometimes 10 years of experience is simply one year of experience ... repeated 10 times. Find someone who you can relate to and seems willing to do whatever it takes to get the job done. There are many new agents in my area that are far better than agents who have been around for a long time.
Third, ask for references ... and check them out! If you can get a referral from a friend, so much the better.
Fourth, as the process progresses, ask lots of questions. If you get answers that make your gut knot up, then trust your gut and be prepared to bail on both the Realtor and the transaction.
Fifth, NEVER, NEVER, NEVER use the listing agent for the buyer's side of the transaction. The listing agent represents the seller and only has responsibility and loyalty towards the seller. This is especially true in "new construction". Come to think of it, I should have listed this "point" first. I've seen too many people (here in the US) get taken to the cleaners by not being represented by their own agent in a "new construction" transaction. They believe that the "builder's rep" really likes them and will act in their best interests ... and nothing could be further from the truth.
I feel that if every potential purchaser of property in PV would follow the above "rules", they'd have a much smoother transaction and a much happier experience.
I haven't purchased real estate in PV but am planning to in 6 or 7 years. My advice to anyone planning to purchase real estate anywhere (but especially in Mexico) is this ...
First, understand the process. by reading all of the articles you can find on the ins-and-outs of the process. Many of the broker's web sites for PV real estate explain, in great detail, how the purchase process differs from what we in the US (and probably Canada) are used to. Make yourself a "checklist" of the steps you'll need to go through.
Second, interview agents. In my humble opinion, it is not absolutely necessary to find an agent that has 10 or 20 years of experience. In fact, sometimes 10 years of experience is simply one year of experience ... repeated 10 times. Find someone who you can relate to and seems willing to do whatever it takes to get the job done. There are many new agents in my area that are far better than agents who have been around for a long time.
Third, ask for references ... and check them out! If you can get a referral from a friend, so much the better.
Fourth, as the process progresses, ask lots of questions. If you get answers that make your gut knot up, then trust your gut and be prepared to bail on both the Realtor and the transaction.
Fifth, NEVER, NEVER, NEVER use the listing agent for the buyer's side of the transaction. The listing agent represents the seller and only has responsibility and loyalty towards the seller. This is especially true in "new construction". Come to think of it, I should have listed this "point" first. I've seen too many people (here in the US) get taken to the cleaners by not being represented by their own agent in a "new construction" transaction. They believe that the "builder's rep" really likes them and will act in their best interests ... and nothing could be further from the truth.
I feel that if every potential purchaser of property in PV would follow the above "rules", they'd have a much smoother transaction and a much happier experience.
Re:Buying property in PV
Dear Judy--A notary (notario) is only involved if there is a closing. If there is no closing, a notary is not involved. The ten original purchasers never closed. However, the developers did use notarios when they transferred our condos to their wives, children, sons, daughters, aunts, uncles etc.
Moving thread to Shopping in Vallarta
It's adecuate for the Shopping section now.
Kind regards
Mogens
Webmaster
Kind regards
Mogens
Webmaster
Re:Buying property in PV
You do not need an FM-3 to buy property in Mexico. It won't make a difference as far as needing to get a trust. Either you are a Mexican national or you are not. We bought a small condo with a trust. We still don't have an FM - 3. We will eventually get one. I believe we do have to have one if we ever decide to sell our condo. Yes, there have been some terrible real estate deals in PV. You must know with whom you are dealing with. Do your homework. We have been very happy with our condo and our real estate agent. We still comunicate with her after 2 years and consider her our friend.
Re:Buying property in PV
I agree with Pat. We went through a realtor who is originally from Seattle. The whole transaction was smooth and professional, title was transferred with no problem, we had Title Insurance that was kept in a bank in Miami and we are very happy with our condo and occasionally have dinner with our agent and his wife.Pat (Sep 06, 2004 05:30 p.m.):
You do not need an FM-3 to buy property. It won't make a difference as far as needing to get a trust. Either you are a Mexican national or you or not. We have bought a small condo with a trust. We still don't have an FM - 3. We will eventually get one. I believe we do have to have them if we ever decide to sell our condo. Yes, there have been some terrible real estate diffinculties. You must know with whom you are dealing with. Do your homework. We have been very happy with out condo and our real estate agent. We still comunicat with her after 2 years.
Re:Buying property in PV
A Fideicomiso (trust) is required to own property near the beach. Foreigners cannot hold property near the Mexican coast in their name. To handle this problem, the major banks provide a trust service for which the buyer pays an initial fee of about US$2,000 to $4,000 and annual fees of $150 to $500, depending on the price of the property and upon the bank. These are very rough estimates; the fees change all the time. The bank then holds the deed in trust for a specified time. This can be renewed or terminated for a fee.
The banks examine the legal paperwork very carefully, hence the usual Acta de Posesión that most of the natives have (the unregistered document issued by a local elected commission) is not acceptable to the bank. Nor is the somewhat more formal Escritura Privada where the property has at least been registered with a county judge. Only the Escritura Publica, a grand document researched and written by a Notaria Publica, is acceptable. Only with the Escritura Publica are you sure that you have a free and clear title. Since there are many stories of land being sold multiple times, the Escritura Publica, held by the bank in a Fideicomiso, is well worth the money.
The Fideicomiso
The fideicomiso is a bank trust wherein the bank (trustee) holds the trust deed for the purchaser (beneficiary). While the trustee is the legal owner of the real estate, the beneficiary retains all ownership rights and responsibilities and may sell, lease, mortgage, and pass the property on to heirs. The fideicomiso is authorized by the Mexican Government under the Ministry of Foreign Affairs
The bank is required to check ownership and insurance, and to verify that the property is free of liens. A trust is granted for a 50-year period. The trust is renewable at any time (for another 50-year period) by submitting an application to the bank. If the 50-year period expires without renewal, the owner has another 10 years in which he may submit an application to renew the trust. If property is purchased that already has a fideicomiso, the existing trust may be transferred to the new owner and will be good for the remainder of its 50-year period, or the trust may be renewed. If property is already in a fideicomiso, probate and transfer tax are avoided when the property is transferred.
There is a fee of about US$350 (varies from bank to bank) to obtain the fideicomiso and an annual fee as well. To obtain the fideicomiso, you will need your accepted purchase offer, a photo ID and 10% of the purchase price. Monetary transactions are handled through the bank.
Taxes
The predial (property tax) is 0.1% of the assessed value, paid annually. The value of the real estate is determined at the time of sale. There is a 2% sales tax.
Closing Process
The closing process takes between 30 to 45 days. The buyer pays closing costs, which are usually about 6% of the purchase price. 2% is for sales tax and about 4% is for other fees such as title search, attorneys fees, and filing of legal documents.
The Notario Publico
The closing of a real estate transaction requires the services of a Notario Publico (Notary). The Mexican Notario Publico is an official who possesses greater rank and responsibility than the Notary Public in the United States. The Notario Publico is an attorney representing the Mexican government. He is responsible to both the buyer and the seller to insure the legality of the contract, and to the government for the collection of taxes and capital gains for the real estate transaction. The Notario Publico finalizes the real estate contract and records the transaction with the Public Registry. A real estate agent may be involved in the transaction, but it should be noted that realtors in Mexico are not licensed or regulated as they are in the United States.
The Notario Publico charges a fee for his services and the bank charges a fee as well. These fees should be competitive and are based partly on the value of the property. Typically, a realtor will work with one Notario Publico who will work with one bank, but there is no reason why the buyer can't shop around, compare fees, and select her own bank and Notario.
The Lawyer
Technically, it is not necessary to have the services of a lawyer in addition to the Notario Publico. However, for additional assurance that your interests are being protected, it may be advisable to hire your own lawyer.
Documents and Information
They buyer will need to provide his address and telephone number in the country of origin, occupation, marital status, and nationality. If married, the same information is required of the spouse. The buyer's passport and tourist visa are required as well as the name, nationality, address and telephone number of any secondary beneficiary to the trust.
Property Management
Condo-owners usually pay a monthly fee for maintenance of the property. For the owners of other property who may be absent for extended periods, property management agents are available to handle upkeep and bill-paying while the owner is away.
Insurance
American title insurance is available for Mexican real estate, but is not commonly used. The cost of title insurance depends on whether the property is covered by a "master title commitment".
Property insurance is available in Mexico and the rates are relatively low.
Financing
In the past, real estate transactions in Mexico were all cash deals. More recently, different types of financing have become available.
A Few More Thoughts
Business deals are processed slowly in Mexico. It may be necessary to make personal visits to resolve details that one might think could be handled by telephone. As is the case in other countries, some Mexicans may not approve in general of the sale of their lands to foreigners. Be a good neighbor.
thank you to http://www.tomzap.com/re1.html
The banks examine the legal paperwork very carefully, hence the usual Acta de Posesión that most of the natives have (the unregistered document issued by a local elected commission) is not acceptable to the bank. Nor is the somewhat more formal Escritura Privada where the property has at least been registered with a county judge. Only the Escritura Publica, a grand document researched and written by a Notaria Publica, is acceptable. Only with the Escritura Publica are you sure that you have a free and clear title. Since there are many stories of land being sold multiple times, the Escritura Publica, held by the bank in a Fideicomiso, is well worth the money.
The Fideicomiso
The fideicomiso is a bank trust wherein the bank (trustee) holds the trust deed for the purchaser (beneficiary). While the trustee is the legal owner of the real estate, the beneficiary retains all ownership rights and responsibilities and may sell, lease, mortgage, and pass the property on to heirs. The fideicomiso is authorized by the Mexican Government under the Ministry of Foreign Affairs
The bank is required to check ownership and insurance, and to verify that the property is free of liens. A trust is granted for a 50-year period. The trust is renewable at any time (for another 50-year period) by submitting an application to the bank. If the 50-year period expires without renewal, the owner has another 10 years in which he may submit an application to renew the trust. If property is purchased that already has a fideicomiso, the existing trust may be transferred to the new owner and will be good for the remainder of its 50-year period, or the trust may be renewed. If property is already in a fideicomiso, probate and transfer tax are avoided when the property is transferred.
There is a fee of about US$350 (varies from bank to bank) to obtain the fideicomiso and an annual fee as well. To obtain the fideicomiso, you will need your accepted purchase offer, a photo ID and 10% of the purchase price. Monetary transactions are handled through the bank.
Taxes
The predial (property tax) is 0.1% of the assessed value, paid annually. The value of the real estate is determined at the time of sale. There is a 2% sales tax.
Closing Process
The closing process takes between 30 to 45 days. The buyer pays closing costs, which are usually about 6% of the purchase price. 2% is for sales tax and about 4% is for other fees such as title search, attorneys fees, and filing of legal documents.
The Notario Publico
The closing of a real estate transaction requires the services of a Notario Publico (Notary). The Mexican Notario Publico is an official who possesses greater rank and responsibility than the Notary Public in the United States. The Notario Publico is an attorney representing the Mexican government. He is responsible to both the buyer and the seller to insure the legality of the contract, and to the government for the collection of taxes and capital gains for the real estate transaction. The Notario Publico finalizes the real estate contract and records the transaction with the Public Registry. A real estate agent may be involved in the transaction, but it should be noted that realtors in Mexico are not licensed or regulated as they are in the United States.
The Notario Publico charges a fee for his services and the bank charges a fee as well. These fees should be competitive and are based partly on the value of the property. Typically, a realtor will work with one Notario Publico who will work with one bank, but there is no reason why the buyer can't shop around, compare fees, and select her own bank and Notario.
The Lawyer
Technically, it is not necessary to have the services of a lawyer in addition to the Notario Publico. However, for additional assurance that your interests are being protected, it may be advisable to hire your own lawyer.
Documents and Information
They buyer will need to provide his address and telephone number in the country of origin, occupation, marital status, and nationality. If married, the same information is required of the spouse. The buyer's passport and tourist visa are required as well as the name, nationality, address and telephone number of any secondary beneficiary to the trust.
Property Management
Condo-owners usually pay a monthly fee for maintenance of the property. For the owners of other property who may be absent for extended periods, property management agents are available to handle upkeep and bill-paying while the owner is away.
Insurance
American title insurance is available for Mexican real estate, but is not commonly used. The cost of title insurance depends on whether the property is covered by a "master title commitment".
Property insurance is available in Mexico and the rates are relatively low.
Financing
In the past, real estate transactions in Mexico were all cash deals. More recently, different types of financing have become available.
A Few More Thoughts
Business deals are processed slowly in Mexico. It may be necessary to make personal visits to resolve details that one might think could be handled by telephone. As is the case in other countries, some Mexicans may not approve in general of the sale of their lands to foreigners. Be a good neighbor.
thank you to http://www.tomzap.com/re1.html
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randyintucson
- PV Fanatic
- Posts:175
- Joined:Wed Apr 28, 2004 9:21 pm
Re:Buying property in PV
We are in the process of purchasing a newly built condominium, and the developer/seller referred to the problem which North is suffering from. I gather that it is a well known topic in PV and that many others on both the selling and buying sides of transactions are benefiting and learning from these real problems.
north (Aug 07, 2004 10:01 a.m.):
Yes, the process is very different in Mexico. The realtors are not licensed. You may get lucky and get an experienced realtor. Then again, your realtor may have been driving a taxi yesterday.
Do not get fooled by the big American franchises. Read the fine print. "Each office is independently owned and operated". You will be dealing with a local person, not a big American company. If you have a problem, the American headquarters does not want to hear about it. They could not care less what happens in Mexico. There are layers and layers of corporate structure that insulate the American entity from the Mexican offices.
It is common practice in PV for realtors to keep the sales commission whether or not the deal ever closes. You will find that your earnest money payment conveniently equals the amount of the realtor's commission. There are no escrow accounts, as we know them, in Mexico. Once you have made that first payment you will never see your money again, whether or not you ever get your property.
Yes, I know that there are thousands of happy foreign property owners in PV. However, if your deal goes bad you will find that there are hundreds of ways to get cheated. Your realtor and his commission will be long gone. You will be left alone to find, hire, supervise and pay a Mexican lawyer in a country where you do not know the language or understand the culture. And, you will be doing all this from thousands of miles away. Don't think for a minute that the judicial system, or anybody else, will do anything to help you. You will have years of litigation, at your expense, in front of you.
Stay happy. Be a renter not an owner in PV.
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Hyme
Re:Buying property in PV
No, you buy with cash and pay a very small fee to maintain the trust. adios. HymeSky1018_pv (Aug 05, 2004 09:21 a.m.):
Oh - and your telling me that when I am ready to retire - and decide to buy a house in Mexico - I'd better hurry and get divorced, and then quickly marry a Mexican?? LOL!!! Maybe I should do it now while I'm young and still have my looks. ROTFLMAO!!
Re:Buying property in PV
I just realized where this thread has gone. I thought it had been deleted.
Dear Randyintuscon--I was happy to read your message. I am glad that people are aware of the situation that the ten of us are in. If only someone had warned us five years ago, we would not have gone through the never ending nightmare that we have lived through for five years. We all dealt with AMPI professional realtors. Well known members of the PV real estate community. They knew what was going on and never warned us. They could have saved us from the hell we have been in. They in fact took their full commissions up front in cash. They refuse to return any or all of the commission. They say it is not their problem. We have to settle it with the developer. They have had their full commissions for five years, the developer has had our money and we have had nothing. The developer is so brazen that for the past two years he has actually been living in one of the units purchased by Americans, and paid for, in 1999. That gives you an idea of how little control there is for a legitimate purchaser. Everyone wants to talk about all the happy foreign property owners. There are many who are not happy, including the ten of us. Believe me, there are more ways to be cheated in PV real estate than you can even imagine. If you have a problem, you will be on your own in a foreign country.
Stay happy. Be a renter not an owner in PV.
Dear Randyintuscon--I was happy to read your message. I am glad that people are aware of the situation that the ten of us are in. If only someone had warned us five years ago, we would not have gone through the never ending nightmare that we have lived through for five years. We all dealt with AMPI professional realtors. Well known members of the PV real estate community. They knew what was going on and never warned us. They could have saved us from the hell we have been in. They in fact took their full commissions up front in cash. They refuse to return any or all of the commission. They say it is not their problem. We have to settle it with the developer. They have had their full commissions for five years, the developer has had our money and we have had nothing. The developer is so brazen that for the past two years he has actually been living in one of the units purchased by Americans, and paid for, in 1999. That gives you an idea of how little control there is for a legitimate purchaser. Everyone wants to talk about all the happy foreign property owners. There are many who are not happy, including the ten of us. Believe me, there are more ways to be cheated in PV real estate than you can even imagine. If you have a problem, you will be on your own in a foreign country.
Stay happy. Be a renter not an owner in PV.
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Scott & Grace
Re:Buying property i
Hi Judimex We are looking to build on the roof of a house in Yelapa and are having a hard time locating an engineer/building inspector who can check out the structural stability. Any suggestions? Thanks!
Judimex wrote:Dear " North." Wow, are you ever in need a of a lesson in Real Estate. I suggest before you start to attack the realtors of this town or Mexico in general, you should get your facts straight. To start with, many of the realtors are licensed. The important thing is that all the property transactions go through a notary "Notario publico" to make sure everything is legal on both the side of the buyer and seller. Second point, all the offices here are independantly owned and operated like they are in the States/Canada. Read the fine print of what exactly? These many real estate offices in our town would not still be in busniess if they are stealing money left right and centre and not supplying a service. You go with who you feel comfortable with, franchise or not. Many are owned and operated by Americans or Canadians anyway so i really don't understand your point. I have NEVER heard of a realtor keeping the sales commision whether the deals closes or not. There are Escrow accounts in Mexico the very same as in the States. Write to me if you want more info on this. I think you are a little ingorant as to how property is bought and sold here. I will be more than welcome to share what little i know with you. My husband is a realtor. He works for Re/Max at the marina. He is Canadian and so is the owner. I know they, as are proabably many other of professionals in this town who are outraged at your outburst of verbal diarrhoea. Do you honestly think this multi-million dollar a year industry would continue here with such corruption?
Buying Property
Hi Scott and Grace--I don't think that Judimex has been heard from since she accused me of having verbal diarrhea.
There are qualified engineers in PV who can answer your question. Get a recommendation from an ex pat living in PV. Do not use someone recommended by a realtor or by the seller.
There are qualified engineers in PV who can answer your question. Get a recommendation from an ex pat living in PV. Do not use someone recommended by a realtor or by the seller.
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palapa_gal
- PV Semi-God
- Posts:2328
- Joined:Mon Jul 07, 2003 7:59 pm
- Location:Canada
