Baja Investments employs a full-time closing officer to oversee the integrity of the transaction. Much like a title & escrow agent in the United States, the Closing Officer’s role is to coordinate all aspects of the sale process, working with Purchaser and Seller, Notary, Escrow Agent, Assigned Attorneys, Developer and Realtor.

Baja Investments has developed an efficient and effective system to close a real estate transaction in Mexico. In most cases, a conveyance in Los Cabos can be closed from 60-90 calendar days for a cash transaction or 90-120 calendar days for a transaction involving financing. However, variations in these timelines may occur, albeit rare, due to delays with the trustee bank, municipal permitting, etc.

Initially the closing date is the date established in the offer to acquire or purchase agreement between buyer and seller. It is important however to understand that the closing date is ultimately determined by the Notary. While every effort to meet the date established between the parties will be made, there are many variables to a Mexican closing and many individuals involved including the parties, the Notary and the trustee bank.

A Notary Public (Notario Publico) is a licensed and expert attorney, certified by the state government and appointed as a Notary Public to act as an official and unbiased representative of the government. A Notary in Mexico has far greater responsibility than a notary in the United States.

The Notary performs a variety of tasks including the authentication of legal documents and acts including real estate deeds to title. AII real estate transactions in Mexico must be ratified before a Notary Public and duly recorded with in the Public Registry in order to be valid and enforceable.

In a real estate transaction, the Notary is responsible to both buyer and seller to insure the legality of the transfer of title, as well to calculate and retain Seller’s capital gain tax and Purchaser’s acquisition tax, coordinate appraisals, certificates of no liens, certificates of no debt, request the corresponding permits and record before the cadastral office and public registry. For this service the Notary charges a fee based on the value of the property. There are state and federal appointed notaries.

In the ‘restricted zone’ of Mexico (100 kilometers from the border and 50 kilometers from the coast) a foreigner may purchase real estate only by means of a FIDEICOMISO (Trust). The fideicomiso is a bank trust, granted in a 50-year renewable term, in which the Trustee Bank holds the property in trust for the beneficial use of 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, improve, mortgage, as well as will the property to heirs. Essentially, the beneficiary of the property enjoys all the rights he would if ownership were fee-simple.

The fideicomiso is authorized via a permit issued by the Mexican Ministry of Foreign Affairs (Secretaria de Relaciones Exteriores) and in accordance with Article 27 of the Mexican Constitution. The trustee bank must obtain this permit on behalf of the beneficiary. In certain circumstances a beneficiary may be assigned the rights of a Seller’s existing trust, provided there is sufficient term left to that trust, this is known as an Assignment of Rights (Cesion de Derechos). The determination to pursue a new trust or to assign the rights of Seller´s existing trust is generally made by the Notary and is often base don the length of term remaining on the trust.

The parties to the fideicomiso are: Trustee (Fiduciario), Purchaser (Fideicomisario) and Seller (Fideicomiente). The Notary (Notario) additionally signs the trust formalizing the transfer.

The Trustee bank is the Mexican bank authorized to act as trustee (Fiduciario). The Trustee Bank must be a Mexican registered financial institution with an established trust department. It is worth mentioning that the properties held in trust are not assets of the bank and size of the bank is not necessarily a sign of better trustee service.

When deciding on the trustee bank the Notary will usually look for a Trustee with a local empowered trustee officer in order to facilitate the closing in a more efficient manner.

In most cases the answer is No. In the majority of transactions the Notary will prepare a simple bank instruction letter with a specific power of attorney for purchaser and seller to sign remotely. These letters will advise the Trustee bank of the Party’s individual intentions in regard to the purchase and sale of the property and direct the trustee to act on their behalf. This letter will be attached to the fideicomiso at closing in lieu of the parties signatures. Please consider that POAs or any document executed outside of Mexico will require apostilles (or certification in case of Canadian documents) and translation from a certified translator.

Unless otherwise negotiated by the parties, the possession of the property is transferred simultaneously with the transfer of title and release of funds from escrow to the Seller.

A purchaser may title the property in any way property could be titled in the US – in their individual name(s) (either via joint tenancy or tenants-in-common), an individual or family trust, an LLC or other US corporation or partnership, etc. This is a matter better determined by Purchaser’s US legal or accounting advisors as tax and legal consequences in Mexico are the same for a foreigner in Mexico regardless of how the property is titled. We recommend to do it individually or through an entity. Please note here that Family Trusts are no longer permitted by most trustee Banks and we do not recommend it.