Hey guys,

I'm interested in buying a small house in the Tijuana - Ensenada corridor. I know much about the laws but my problem is I can look only 1 day per month or so. I check the web frequently but I'm wondering if there's anyone that lives in the area that could give me the inside scoop. I'm not interested in a land lease deal like at Rene's and I can't afford the expensive developments.

Any info will be appreciated and I will be glad to share what I know about the mechanics of buying south of the border.

I'm sure you know what you're doing. As a real estate broker I have one bit of advise for you. GET TITLE INSURANCE!!

Conozco

Do you reccomend title insurance even when purchase is accomplished by setting up a fideicomiso?

(Message edited by Reytj on June 13, 2004)

Conozco

I think I already found the answer to my question-yes-so let me ask another. A web site estimates that title insurance on a $150,000 property would run about $1000. Does that sound right?

Reytj

Are the laws banning foreign buyers from purchasing land with X amount of kilometres from the ocean shore line, still in effect? Are they enforced??

If it is, the options would be to 1: rent/lease, 2: have mexican citizenship/and or/marry a mexican, 3: set up a corporation that would be eligible to buy property within the restricted limits

I'd like to know the real scoop on this. If it's still factual and the common "work-arounds."

OG

I was told recentely that the main reason for that law and it is an old one is that the Mexican government were afriad of a US army invasion by the ocean therefore they didnt want any Americans owning property to aid in that effort. Any truth to that. I found it very interesting.

I don't know the reason for the coastal exclusion zone, which effectively eliminates foreign ownership of property in all of Baja, but I think the law is in the constitution and the only alternative is the fideicomiso (bank trust) or obtaining permanent residency / citizenship status in Mexico.

I'd like to know the name of an organization that offers title insurance. It's my understanding it doesn't exist in Mexico. It would be good to proven wrong.

Another bothersome law is that any land lease greater than 10 years is an illegal lease and regardless of what the contract says, the owner could refuse to renew the lease after 10 years and you have no legal recourse. Caveat emptor!

I was recently looking at a house for $80K on the coast between Rosarito and Puerto Nuevo where the owner was offering a land lease deal of $300/month for 30 years. "Consultation" with a notario/lawyer in TJ revealed the 10 year limit law. The "consultation" was actually a friend calling a lawyer friend and asking a single question, so I didn't get into any discussions. I did, however, confirm the 10 year limit with a Mexican real estate agent.

So if I bought this place, which needed major repairs, the owner, who I think in fact really owns any improvements on the land, could take possession after 10 years and tell me to get lost. It's hard to believe that my $80K would be out the window, but I think it's true. I need to know more about these types of deals.

Anyway I'm looking for a $100K fideicomiso house as a weekend get away and eventual full time home. If anybody comes across one in the corrdior let me know.

Conozco,

Do you know of any San Diego banks that will provide a mortgage for Mexican property using that property as collateral? I've been hearing tidbits here and there that this is beginning to happen. From what I understand the Fox administration is pushing these ideas to further development in Mexico.

I thought as a broker you might be able to check into this using your banking connections.

TIA

Ldvee

OK..Ok I will research the name and rates for Mexican Title Insurance underwritten by First American Title AND American lenders for Mexico.

I thought I heard that Chicago Title here in San Diego was also doing title insurance and Washington Mutual was doing loans?

caldwell banker(east lake office) chula vista has info on home ownership/land in mexico.

Ldvee

Did Conozco ever get back to you? If he did would you mind sharing the info, specifically about American lenders for Mexico?

For all hombres still interested in purchasing real estate in mexico I recently came across a few web sites that were very informative.
www.mexicorealty.com, www.financemexico.com and www.cbhomestore.com explained a lot in regards to americans legally trying to buy in mexico.

Hey Guys,

I started this thread back in June and would like to report that I've taken the step and have recently signed a contract to have a house built in La Perla Bahia. $147,500, 2 bdrm, den, 2 1/2 bath, 1600 sq. ft. Two car garage and a small yard. The development is in Las Playas de Tijuana and has 24/7 security. A block or so to the beach.

I'm not financing but financing is available at 13% for 20 years with 20% down. I'll be keeping my apartment in San Diego for a few years while I'm working my corporate job and eventually move there full time when I decide to give up my job. Who knows, I may commute for a while.

They just started selling phase 2 which is where I bought. I've watched phase 1 go from nothing to complete over the past 2 years and feel confident that phase 2 will sell quickly.

http://www.laperlatijuana.com/

http://apil.warebox.net/laperla/index.asp

http://www.baja-relocation.com/la_perla

http://www.casaslink.com/tijuana-homes.html (bottom of page)

Ldvee your the best
Got room for one loser?
Thanks for the update
good luck
Milkman

Milquetoast,

Thanks for the kind words.
A loser pup tent in the backyard might work 8^).

BTW, the contract said no putas allowed, so I'll pay them after outside the gate. Afterall, that's why we pay them, to leave, right?

Are you serious that the contract actually mentioned putas? What, that you couldn't have them visit your house, or that they couldn't live there, or???

Wow. Man would a lawyer have fun with THAT kinda clause in a contract in the USA!!

it actually said putas con drugas

Just shows you how real Mexican feel about putas

It said you can't run a putaria in the development. I forget the exact words.

or would it be putateria?

Prostibulo is the term that tends to appear in legal documents.

I was kidding abou the putateria...

It actually says "No establecer en la Unidad Privativa o la Casa expendios de bebidas alcoholicas, casa de juego, lenoconio o cualquier otro uso contrario a las buenas costumbres."

Loosly translated means: " Not to establish in the Exclusive Unit or the House stores of alcoholic drinks, house of game, lenoconio or any other use opposite to the good customs. "

Since we are on the subject of real estate, doesn't the Mexican constitution prohibit foreigners owning land within 100 km of the border (or the sea)?

Yes, but you can take title by trust, which is good for 99 years. It's called a "fidelcomisso" and allows foreigners to indirectly own land in the forbidden zone. I own a home in Cabo San Lucas under this scheme, as does every other Gringo who "owns" property in Baja. The bank is the 'owner in trust' and you are the beneficiary.

"doesn't the Mexican constitution prohibit foreigners owning land within 100 km of the border (or the sea)? "

My understanding is that it's within 100 km of the border but 50 km from the coast.

My problem with the fideicomiso is the annual fee you pay which I understand can be increased as the property apreciates.

You need to be careful with fideicomisos.

This sums it up:

http://www.taxmeless.com/connel.htm

True, there are expenses associated with fideicomisos but they are greatly outweighed by the cheap property tax - about $200 per year for the house I'm buying, when comparing costs to San Diego.

There's also a 4.4% charge when I take ownership, 2.2% for the notario and 2.2% sales tax, if I understand things correctly.

Basically, this trust is a 99 year lease, so there is no actual ownership involved.

I have spoken with Real Estate agent before on FidelCastros and you can also have the property siezed from you at anytime if you are arrested for serious crimes and or pose a threat.
And Explorer is correct there is no actual ownership but I beleive it can be renewed. Only Ben lives that long but I beleive it can be pased onto family members as a renewal

"Basically, this trust is a 99 year lease, so there is no actual ownership involved"

It's not a lease. If it were you could not sell it or bequeath it to someone else in the event of your death.

basic info:

http://www.settlement-co.com/faq-splash.html

Explorer,

You are incorrect "Basically, this trust is a 99 year lease". There are no legal similarities whatsoever between a lease and a fideicomiso. The fideicomiso is a trust and I will be the sole beneficiary of the trust. There are no practical differences between that and owning the property. I have full use of the property, I can sell it, and I can will it. As Reytj pointed out, you can't do that with a lease.

Also, a 99 year lease in Mexico is a sucker contract. It is illegal under Mexican law. The maximum lease period for real estate in Mexico is 10 years. So if the owner locks you out after 10 years, eventho you both signed a 99 year lease, you have no legal recourse. As in the US, ignorance is no excuse.