This is some great advice for anyone here in San Diego wanting to buy property in Mexico. Great to know there are US Companies that offer Escrow Services for these properties. Sounds like it would be worth the expense!
Find out how to protect your good faith deposit and Mexico Earnest Money.
Your ready to buy your piece of paradise, but handing money over to someone you don t know in a foreign country is a scary proposition. So how do you protect yourself from a fraudulent situation
Purchasing property in the Cancun real estate market and even in all regions of the Mexico real estate market is a quite different process than in many other countries. And when it comes to handing over deposit money, many buyers make the mistake of leaving their good judgment at home; thinking this is Mexico and this is how business is done here.
Most of those trustworthy buyers have purchased without problem, but there is always a risk. It is not necessary to have a Mexico Real Estate license to sell propeties So it is important to know who you are dealing with and how to protect your interests.
Although not widely used in Mexico, escrow services are available through well know US companies and should be your first choice. There is a fee, but the protection it offers is well worth the extra expense.
Escrow is mostly used for re-sales but the property owner must be in agreement This can sometimes be an obstacle as some Mexican owners do not understand the concept of escrow. In most cases the listing broker can convince the owner if it is properly presented.
This would be the next option only if the property owner will not accept escrow deposit. Either the listing broker or the buyer s broker holds the deposit. This is more of a risk, so ask for references and DO CHECK THEM.
Most developers will not accept escrow deposits as they use incoming funds for construction. Deposits may be refundable or non-refundable (before the contract is signed) so do ask. It is important to work with a broker that you trust to present you with projects by developers with a proven track record.
The Mexico Property owner
It is customary for the initial deposit to go directly to the owner in the case of a re-sale. This is very risky and I do not recommend this situation. If unavoidable, do so in conjunction with your OWN Mexico real estate lawyer, following his advice so he can make sure you are legally protected.
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Thomas Lloyd, graduated from Purdue University Krannert School of Management with a degree in Management/Financial Option Investments. He has been living, investing, and working professionally in Mexico for over 15 years. Mexico Real Estate Degree & Professional Identificacion Number S.E.P. #5978657. He is the current president of TOPmexicorealestate