A Guide to Acquiring Property Safely in Puerto Vallarta and Jalisco
Text by Lic. Alejandro Flores Von Borstel - Photos by Danilo Rottigni
- The first step is to retain the services of a specialized real estate company who will charge a 6 to 8% commission based on the property’s value. You must also choose a trusted notary public.
- Look for the abbreviations AMPI in the real estate company’s description, so that there will be a guaranteed in legal review. This will facilitate the transaction since the closing period is fundamental.
- Make clear that the seller is in charge of all closing costs, including expenses, taxes, and fees.
- Analyze all financing possibilities. Now there is direct financing on short and medium terms for Mexican and foreigners. Foreigners also have mortgage credits to buy or build their vacation home in Mexico. This type of financing is available from firms such as Collateral Mortgage LTD, which grants credits of up to 50% of the value of the property, starting at $400.000.00 USD and for 20 years, to American citizens who wish to build, remodel or purchase vacation property in Mexico.
Another way in which foreigners obtain funds to purchase real estate in our country is by obtaining financing using properties or assets in their home country as collateral.
The minimum down payment is 30%, and the annual interests start at 8.75%. The minimum credit is for the amount of $100.000.00 USD and the maximum is $800.000.00 USD.
- The notary public acts as the responsible agent of the real estate property. It is not generally common to have title insurance but there are Mexican and foreign companies which do offer this service.
Having title insurance guarantees validity and priority of their rights on the property to the insured party (owner, trust holder, or mortgagee). It is also an indemnification contract between the insured and the company that issues the policy. An insurance title is also a detailed analysis and evaluation of the public and private documents and plans relating to the property’s deed.
In the case of loss or adverse complaint to the title insurance policy issued by a company, that company is obligated to:
- Compensate the insured party for losses suffered, whenever said loss or damage does not result from the titling or deeding problem that had been expressly exempted from the policy.
- Pay the legal costs of defense and protect the insured party faced with any claim that questions the validity and preference of their rights on the property.
- When possible, eliminate or resolve the fault or encumbrance that affects the title in question.