- 1) Narrow Your Focus:
What is my Budget? Find how much you can get from your Bank
Size - How much space do you really need? a lot of retirees think that they need a lot more space than what
they end up needing. They think that maybe kids are coming down and they may need rooms for the whole family. If they are only coming once a year, they can rent or exchange vacation rentals.
Is Oceanfront a Must? look into your budget so we can see if we can get you into a condo or a private house. However if it is not a must, you can get a lot more house for your money on the street
Condo or Private House? there are prons and cons for both, there are people are are condo people and there are ones that are private house people. If you are only going to stay here a couple of weeks, then a condo may be a best option.
In Town or Out of Town? What kind of privacy do you want, do you want to stay near the big malls and supermarkets where there is a lot of people or do you prefer the privacy and tranquility of being out of town and near the nature
Is Rental Income a Factor? Maybe you want to find a house that has a rental history that you can rent to other people while you are not using it during the year
2) Before shopping, do you homework to find out what budget you will be able to work with, given your financial abilities. Once you know what is your real budget and you have talked with your Bank, then we can show you various great houses that may fit into your Budget and not waste time looking at homes that you cant afford or are out of your range.
3) For Budgeting purposes, plan on 6 to 8% for closing costs. If you are purchasing something under $500,000 your closing costs are going to be closer to 8%, if you are buying a property over $500,000 your costs are going to be more like 6%
4) Use the same common sense that would apply to a transaction at home
5) Do NOT open a Mexican corporation if your intent is to own a private residence. You will find some statements to the contrary on the internet, but the Law is very specific, Fideicomisos are the way to Own private property within the Restricted Zones, do not open a Mexican corporation if you want to own a private residence. If you put your property into a Mexican corporation, disobeying the law, then you will put yourself into a corporate tax record and you will also be obligated to meet corporate filing obligations, in Mexico Businesses have to file corporate earnings every 30 days. So you will be paying an accountant $120 dollars a month to file zeros for your corporation that is a private residence and it is illegal.
6) Be Informed, Laws are modernizing in Mexico. Be smart about the information found online, some is outdated and some it is wrong.
7) Do list the property at the full purchase price (less value of furnishings). It used to be a practice in Mexico to under Report Real Estate Properties, people would pay x amount and would report a different amount, for example they would pay $200,000 for a property but only report $100,000 to the Mexican Government. Dont do it its tax Fraud. That said you dont have to pay Taxes for used Furniture, if the cost of the property is $230,000 dollars but the cost of the furniture included is $30,000 then you only need to report $200,000 dollars as the cost of your property.
8) Be very diligent if you are considering a Pre-Sale purchase. A Pre Sale purchase is when you are buying a property under construction or the construction is not yet completed and the Title is in process. Anything that you Buy before the Title is ready is consider a Pre Sale purchase, in Mexico there arent the type of consumer protection laws that are elsewhere and so you have to be careful. If you are considering a pre sale purchase hire an attorney to represent you on your behalf that will make sure that everything is right in that pre sale contract.
9) Closing takes approx 60 to 90 days to complete and you must be present at closing. However the process of that Bank Trusts is now mostly automated online and is getting faster.
10) Use a Qualified realtor and do not be afraid to ask them questions.
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