is the Notario Publico who, in effect, acts as a "Holding
agent" for the involved parties and for this reason there
are few escrow companies in Mexico. At the present time there
is no general use of title insurance in Mexico, although some
American companies are providing coverage in some resort areas
of the country. On the other hand, insurance companies do
provide full home coverage-throughout Mexico.
PUBLICO OR NOTARY PUBLIC
Notario Publico is a government appointed lawyer who processes
and certifies all real estate transactions, including the
drawing and review of all real estate closing documents, thus
ensuring their proper transfer.
Furthermore, all powers of attorney, the information of corporations,
wills official witnessing, etc. are handled and duly registered
through the office of the Notario Publico, who is also responsible
to the government for the collection of all taxes involved.
In connection to real estate transactions, the Notario Publico,
upon request, receives the following official documents, which,
by law, are required for any transfer:
. A certificate of no leans from the
Public Property Registry based on a complete title search. .
A statement from the treasury
or Municipality regarding property assessments, water bills,
and other pertinent taxes that might be due. .
An appraisal of the property
for tax purposes.
Mexico, the concept of capital gains tax does not apply in
the sense in which it is determined in the United States.
Here, the gain from the sale of the property is considered
as normal income at a tax rate of up to 35%. In order to determine
the gain, the following costs and expenses are deducted from
the amount for which the property is officially sold:
· The original land cost and the depreciated construction
cost, based on the number of years the property was held and
adjusted for inflation according to the official consumer
modifications and improvements, but not maintenance, made
on the property (construction), adjusted as above. .
paid to real estate brokers by the seller. .
closing costs, including all expenses, taxes and fees paid
by the seller. The Notario will retain the calculated gain
after deductions forwarding it to the Mexican tax authorities.
The seller will then deduct this amount against his/her annual
tax return, which becomes an adjustable tax credit in the
U.S. On the other hand, there is no capital gain tax in Mexico
if there is conclusive proof the seller has had the property
as his primary residence for the previous 2 years.
OF THE FIDEICOMISO
on a present tariff, the bank charges the person requesting
a fideicomiso an initial fee (approx.$500.00US) for the drawing
up of the agreement and establishment of the trust, plus a
percentage according to the value of the property. In addition
the bank charges an annual fee (depending on the value of
the property) to cover its services as a trustee.
is common practice that the buyer pays the transfer or acquisition
tax as well as all other closing costs including the Notario
fees and expenses, and the seller, pays his capital gains
tax and the broker's commission.
Since January 1, 1996, the federal law regarding the real
estate transfer tax, which was 2% for all the Republic of
Mexico, was modified in order to allow each of the Mexican
States to determine its own tax. The range may be from 1-4%,
of the tax appraisal value, generally less than the sales
The rest of closing costs, which excludes the transfer cost
mentioned above, may vary from 3-5% of the appraised tax value
or more, depending on each particular State. These percentages
are applied to the highest value of the following:
amount for which the property is sold. .
value of the official tax appraisal. .
value designated by the property assessment authorities.
policy of title insurance is a contract with an insurance
company in which it agrees to indemnify (compensate or reimburse)
the insured against a loss sustained as a result of defects
in the title, other than those outlined as exceptions. The
title policy may insure the owner, a lender, a mortgage holder,
a holder of any interest, as indicated by the buyer of the
policy. The title insurance company agrees to defend, at its
expense, any lawsuit affecting title which is based upon defects
insured in the title policy.
Stewart Title Guaranty Company of Houston Texas underwrites
US style title insurance for PV Realty customers, should they
choose to have it. The cost of this insurance will be approximately
$7US per $1,000US of the insured amount. We view this commitment
by the one of the largest and highest rated financial Title
Insurance Guaranty companies in the World as a endorsement
of the security of the Real Estate business in Mexico. Should
this be something you wish to have additional information
on, please make a point of asking your Sales Associate for
more detailed information as to the process.
taxes are very low in Puerto Vallarta. Known as 'Predial'
-- the mil rate is .08% of the assessed value, paid every
bimester. Values are determined at the time of every sale
as one of the requisite documents needed for a legal closing
is the assessment tax appraisal which is completed by a competent
and licensed appraiser specializing in these valuations. Property
taxes have historically been low in Mexico because they have
never been considered to be significant source of governmental
types of insurance -- including vehicle or property, liability,
damage, and earthquake -- are all readily available in Mexico,
at reasonable rates. PV Realty is a registered agent for SEGUROS
AMERICAS, the largest general insurance company in Mexico.
We are able to offer our customers competitive bids for all
types of policies. They can also be written to pay claims
in U.S. dollars.
estate purchases in Mexico are virtually all-cash transactions,
with limited cases of owner financing available. Most individuals
arrange financing in the country of origin based on their
existing assets in that country. Banks in the US and Canada
are restricted by law from lending on foreign property.
Realty, The Right
Choice...® Copyright 2001
Contact Us: email@example.com
(322) 222-4288 or (322) 223-2840
Fax: (322) 222-4287
& CANADA, please dial: 011-52 (322) 222-4288 or 011-52
Fax: 011-52 (322) 222-4287
material is based upon information which we consider reliable,
but because it has been supplied by third parties ,we cannot
represent that it is accurate or complete, and it should not
be relied upon as such. This offering is subject to errors,
omissions, change of price or sale withdrawal without notice.