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Why should a continuing care retirement community be considered for BCS?

Proximity to the US.  The Los Cabos international airport provides flights to all over the US, Canada and other parts of the world.   Access is simple!

Quality of Life:   is high with outstanding services, shopping, travel options available.

Medical Services:  are excellent and abundant and available at reasonable cost whether for emergency care or for general care.

Cost of Living:   Can be expected to be about 40% less than most parts of the US and Canada.

Climate:   360 days of sunshine each year.  Average temperatures range from 63 to 86 F. year round.  

LINDA JONES NEIL, listing broker for Rancho Gaspareno

For additional information:

linda@lindaneil.com

(011-52) 612-157-6497

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Why is Baja California Sur the perfect location for this investment?

In 2018, Baja California Sure is the fastest growing state in the country with 18.1% growth, and industry has grown 92% over 2017 reports INEGI, the National Statistics Institute.

Situated on the Pacific Ocean and the Sea of Cortez, Baja California is the most desired and attractive tourism and retirement destination in the country.

La Paz, capital of the state, is more than 500 years old with seven universities, major sea research centers and is gateway to the fabled Sea of Cortez.

Southward, Todos Santos, a Magic Town, (Pueblo Magico) is home to artists, writers and creative people from all walks of life.

Los Cabos, golf center of Latin America, is home for many of the rich and famous, and there is something for everyone in Cabo! Up the East Cape, some of the finest sports fishing in the world is found and Cabo Pulmo, Marine Sanctuary, harbors hundreds of exotic species.

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Why is Mexico an ideal location for your next project?

As the leading Spanish speaking country in the world, Mexico encourages and welcomes foreign investment .

The economy is the 13th largest in the world in Nominal terms and the 11th largest by purchasing power parity (PPP), according to the International Monetary Fund.

Mexico is a young country with an average age of 27…….bodes well for the future.

Mexico is the world’s fourth largest oil exporter.   With the price of oil currently low, other sectors  such as manufacturing, tourism and workers´remittances provide greater foreign investment.

Mexico is the 8th most visited country in the world.

Mexico has 11 Free Trade Agreements covering 45 countries, it also has 9 Economic Complementation Agreements, has signed Investment Promotion and Protection Agreements with 2 countries and has negotiated Double Taxation treaties with more than 31 countries

Mexico, Canada and the US joined together in 1994 to create a continent wide free trade zone with a population of 439 million people and a combined GDP of 14 trillion USD.   This has recently been re-negotiated and is beneficial to all three countries.

Mexico is California’s main trading partner and 31% of all Californians are of Mexican descent.

10,000 baby boomers are turning 65 every single day, according to AARP.  This is expected to continue into the 2030s. Easy access, great weather, lively lifestyle and caring and welcoming Mexicans make this an attractive option for retirement and long term care in the country.

AMAR the Mexican retirement association is growing and providing good infrastructure to support the increasing Aging in Place facilities.

Younger people, thinking ahead to retirement, buy homes to provide rental income now, appreciation for the future retirement.This provides great vacation rentals. It is 40% less expensive to live in many parts of Mexico than it is to live in many parts of the US and Canada.

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RULES FOR A SUCCESSFUL REAL ESTATE PURCHASE IN MEXICO

BUYING REAL ESTATE IN MEXICO

 

Mexico is a wonderful and very beautiful country.  If you  enjoy your visit you may begin to think about acquiring a bit of our paradise.  We have mountains, lakes, rivers, forests, deserts and seashore in Mexico.  We also have history, ancient cultures, handcrafts, folklore and many other wonderful things to share.

 

Buying property in ANY country can be stressful.  A property purchase in Mexico can be just as safe and secure as in the U.S. or Canada… IF it is done correctly!

 

Here are some guidelines for success in a real estate acquisition in Mexico:

 

  1. Be sure the agent you select to represent you is a member of AMPI, the Mexican National Real Estate Association. Ask for references, check them out. Be satisfied the person representing you is experienced in Mexican transactions.

 

  1. Insist that the person representing you, represent ONLY you, the buyer, and not also the seller unless you understand, agree to and sign an agency disclosure agreement.

 

  1. Consider only the purchase of PRIVATE property. Ejidal property is often offered at a far lower price but it cannot legally be sold or promised to be sold until it becomes private property.

 

  1. Be certain that you and your agent are dealing ONLY with the owner of record or his or her legitimate power of attorney. Insist upon receiving a copy of the seller’s deed as a condition of your offer.  If you  and /or your agent don’t understand Spanish, get it translated.

 

  1. . Avoid costly and time consuming litigation, insist upon including a binding arbitration  clause in your contracts with the seller and other parties involved.

 

  1. Get a title investigation and buy title insurance for the full amount of your purchase price. While the initial search may seem expensive for some areas, the title policy transfers risk to the insurance company, and minimizes yours as the buyer.

 

  1. Think carefully about how you acquire title in order to avoid or minimize probate and transfer costs in the future.
  2. Closing costs may run from 13% to 20% of the cost of a $50,000. dll. property! The multimillion dollar property will be about 3.5% of purchase price.  Certain costs are fixed regardless of value.  Be sure to budget for closing costs and get a full estimate in writing from the company supervising your transfer.

 

  1. The major portion of your payment for the property should be withheld or held in escrow until the deed has been signed by the seller and, if applicable, the bank trustee (if a fideicomiso).

 

  1. INSIST upon receiving a registered title document for your property. If the seller is financing the property, sign a document protecting his interests in the event of your default.  Be SURE you know the amount which is declared in your deed and understand the tax implications of same.

 

  1. Use an experienced neutral third party to supervise the transfer of title to you. 

                     

Rules2.articles. Copyright2003 2015. All rights reserved by Consultores Phoenix, S.C., and The Settlement Companyâ

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Arbitration and Mediation

RESOLVING REAL ESTATE PROBLEMS IN MEXICOTHROUGH MEDIATION AND ARBITRATION

 

Lawsuits, courts and attorneys cause headaches in any country.  Mexico is no different.  INEGI, the National Statistics Institute, says that there are 33,000 persons in Mexico City for each judge.  It isn’t really any better in other parts of the country.  We simply do not have enough courts and judges to listen to every complaint, legitimate or not, within a reasonable time.  The result is that reasonable claims may take years to be heard and then additional years to be resolved.  After that there is an appeal period that adds to the delay. Thus it is not unusual to hear of a civil complaint to force a seller to honor a real estate contract taking five, ten or even fifteen years to resolve.

 

Once resolved, attorney fees may take 30% to 50% of the award, in addition to the costs that have already been paid by the plaintiff.

 

Instituting a lawsuit can be a lose-lose proposition for everyone.

 

The good news is that we now have an alternative method of resolving disputes and enforcing them in Mexico.  Due to provisions in NAFTA, Mexico has modified its laws to permit Alternative Dispute Resolution and has provided for enforcement of arbitration awards in the courts.  Articles 1415 to 1463 of the Mexican Commercial Code provide the guidelines for resolving problems outside the courts and eliminating much of the delay and expense of a lawsuit.  The court authorities in Mexico now realize that all matters cannot always be resolved by government and they now realize and accept that the most economical and efficient resolutions may be obtained in a resolution arrived at outside of a court of law.

 

Alternative Dispute Resolution (ADR) has been practiced in the United States and Canada for many years and has become a highly successful and preferred method for settling conflicts by many.  The process is now receiving the approval and encouragement of the highest courts in Mexico which have set up separate departments to study and implement mediation and arbitration sections in the federal, state and local courts.

 

Instead of being forced into a lose-win situation, as is the case in a lawsuit which is confrontational by nature, in mediation, the parties may find areas of mutual interest and amicably settle their differences in a cost-effective and timely manner.   In addition to commercial and trade disputes, ADR has been highly successful in family and divorce matters and, even more, in real estate related matters.

 

Some basic elements:

 

MUTUAL CONSENT is a requirement.  In order for a problem to be submitted for resolution through mediation or arbitration, it is necessary that both the complaining party and the defending party agree to submit to arbitration.  This is often accomplished by inserting a special clause in the contract of purchase/sale or the deed before the notary public when real property is involved.  In this manner both parties have agreed prior to a conflict arising and do not have to argue about this point when the problem comes up.

 

MEDIATION first, then ARBITRATION:  Most clauses which provide the mutual consent will specify that a good faith attempt be made to settle the matter in an informal setting.  Agreements made through mediation are not binding upon the parties.  If the parties cannot reach a mutually agreeable solution, the matter goes to arbitration in a more formal setting.  The parties have the opportunity to approve or disapprove of the arbitrators and, generally, one to three arbitrators are called to hear the case, depending upon the wishes of the parties and the severity of the matter to be decided.  The decisions handed down by the Arbitrators are binding upon the parties and, should it become necessary, the courts will be called upon to enforce the judgments.

 

MEDIATORS and ARBITRATORS are generally professional people with legal background and/or expertise in the subject matter under consideration.

 

COSTS FOR MEDIATION, ARBITRATION are generally minimal in comparison with those involved in a lawsuit.  Normal charges will involve processing fees, hearing room rentals, hourly fees for the arbitrators and travel expenses as required as well as charges, as necessary for translators, copies, courier services and expert witnesses.

 

TIME CONCERNS  Since the arbitration and mediation services are private and run by business people, economy of effort and time is seen as an important portion of the equation for the success of the company supervising the arbitration and mediation services.  While a track record has yet to be established, it is anticipated that most mediation/arbitration services will be completed within a few months of filing the complaint.

 

Unquestionably, the number of conflicts and disagreements that are resolved through Alternative Dispute Resolution will increase considerably over the next few years.  Since it is will be far less expensive and quicker to solve problems in this manner, it may make sense to begin to include an arbitration clause in all of your real estate contracts now.

 

ABOUT THE AUTHOR:

            Linda Neil founded The Settlement Company® in 1991.  It is the original escrow company in Mexico and has successfully processed thousands of trusts and title transfers of Mexican real estate.  Mrs. Neil, a real estate broker licensed in California, has spent more than thirty-five years in Mexico in the development of real estate and related activities.  She frequently presents seminars on both sides of the border on the subject of real estate ownership in Mexico and is a member of AMPI, NAR and FIABCI.  She holds PROFECO Certificate 00065/96, The Settlement Company® handles transfers of properties and provides title insurance for properties located throughout Mexico. It specializes in the Virtual Closing®

 

Articles/arbitration and mediation  Copyright, 2003, 2005, 2008 2012- 2014  Consultores Phoenix, S.C. Reproduction prohibited without permission.

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Active Living, Assisted Living in Mexico

ACTIVE LIVING……ASSISTED LIVING

 

Is this a niche market that can help the Mexican real estate market come back?

 

By Linda Jones Neil

 

 

With millions of baby boomers reaching retirement age every day, the market for a lovely place to live with the security and services required is growing exponentially.

 

Many baby boomers no longer want the five bedroom home and quarter to half acre home in the suburbs.   Nor does the luxurious and prestigious home on the beach seem as attractive as it once was.  Too much work!   Too much upkeep! And too much money!  Today’s couple reaching retirement age is looking for an interesting and inviting place to live that promises outstanding value and something different!

 

Many are coming to recognize that Mexico with its lower cost of living, culture and tradition for caring, with outstanding medical services, may be the new place for Americans and Canadians looking for retirement.   Perhaps Mexico will no longer be just a vacation in an exotic place!

 

When the crisis really hit the U.S., many of the buyers of Mexican vacation properties left the market.   Their investment funds came from the stock market, 401 Ks and home equity.   These sources obviously dried up and the resort and vacation market hit bottom.    Prices, however, have not necessarily come down in the resort areas since many sellers do not have bank loans on their properties and are in a position to hold on to their properties until that market returns.

 

These properties may not sell soon, however.   There seems to be a feeling among those who suffered reverses in their portfolios that this time they will look for quality, value and security rather than plunk down money on an emotional and perhaps exotic purchase.

 

There is a delayed demand – many of those who left the property market in 2007 and 2008 did so because they were suffering devastating losses in U.S. investments.  Now that those markets are beginning to recuperate, it seems that the home or condominium for vacations, rentals, active retirement will be more attractive if of high quality, easily accessible and not exceed 200,000. to 300,000. USD in price. Also very desirable is the development that integrates the Mexican culture into its overall concept. The home away from home of yesteryear, insulated from the Mexican culture, may not be quite as attractive as it used to be.

 

What may be sought after in this new market is the development that offers Active Living and Aging in Place.   In other words, independent living modules, either separate homes or condominiums within a secure community with many activities available either on site or in the community: such as biking, hiking, fitness, swimming, crafts classes, music activities.  These activities are geared to the mature active adult who has always wanted time to do these things and can live independently.   Within the same community, however, are medical facilities, and increased services available such as the preparation of meals, home visits and so forth.   Different packages of services are available to fit the variouef levels and requirements and can be purchased from a hospitality company operating the development.

 

These independent living units can either be purchased or leased.   The move to assisted living will focus on  a more institutional environment which features everything from meal preparation to intensive care.

 

Under consideration at present in the U.S. government, is an initiative to permit Medicare benefits to extend to care received in Mexico.   Since health care costs are substantially less in Mexico for the same level of care, both the U.S. government and the patients will benefit.

 

In all cases, the successful Active Living to Assisted Care development will require excellent access to health facilities, airports for quick access by loved ones, and outstanding communications systems in the community.   There are perhaps a dozen cities in interior Mexico which may fit the bill for this new focus on sales to the foreign market.

 

# # # # # # # # # # # #

 

Active Living, 2009-2014 Copyright Consultores Phoenix, S.C. Reproduction prohibited without permission

 

 

ABOUT THE AUTHOR:

            Linda Neil, CIPS, SRES, RSPS, TRC, PIC, ePRO, is the founder of the settlement company â.  It is the first company in Mexico dedicated to counseling buyers and sellers and to supervising the closings and registrations of real estate for non-Mexicans.  The company supervises the transfer of titles, provides due diligence and legal services for buyers and sellers, as required, for properties and corporations holding real estate located anywhere in Mexico. The Settlement Company specializes in the Virtual Closing®     

 

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Agency and the Real Estate Agent

AGENCY and The Real Estate Agent –

            duties, obligations and professionalism in the performance of services.

 

by Linda Jones Neil

 

In real estate the party that represents a buyer and or a seller in the purchase or sale of a property, is called an agent.  In Mexico as in other countries of the world, the agent has a duty to treat his principal in an ethical and professional manner.  The obligation to represent the interests of his principal makes it very difficult for the conscientious agent to represent BOTH buyer and seller since the buyer wants to buy the property for the lowest price possible and the seller is looking for the greatest amount of money he can get for his property.

 

With this in mind, how can the conscientious agent honestly represent both parties?  Almost anyone will agree; there is a conflict of interest when anyone tries to fairly represent both sides of a transaction.

 

No matter how much we need or want the money that will come from a FULL commission, better to call in a colleague to represent one side or the other.  That way both share in the commission, both principals are honestly and fairly served and the agent will have clients who will recommend his or her services to other friends and acquaintances

 

It ends up being win-win for everyone!

 

To reinforce the relationship with buyer or seller clients it is important to understand and discuss this with the client; outline the responsibilities of the buyer’s agent, the obligations of the seller’s agent and how to handle the important issues such as money where price is being negotiated.  A confirmation of the relationship should be signed with the buyer or seller client.

 

Not only does this confirm the essentials of the fiduciary relationship, but also the clients, knowing that an agent is working EXCLUSIVELY for them, and not the other side, will be much more likely to remain loyal to his/her agent.

 

And what are the obligations and responsibilities?  Simply put, the SELLER’S AGENT has the obligation to counsel his seller as to fair and reasonable selling price, as to the importance of disclosure of defects in the property, as well as to offer the property to the widest audience possible.  The purpose of this, of course, is to obtain the highest price possible for the property.

 

The BUYER’S AGENT should assist the client in locating the best property possible which will meet buyer’s requirements.  Once located, the property should be inspected as to suitability for the purpose intended and the most attractive price and terms possible negotiated for the acquisition of the property.

 

In all cases, the agent must treat all parties with honesty and fairness.

 

Forms confirming agency relationships are available by contacting the author at the address below.

 

PROFESSIONALISM…………..everybody talks about it.

 

What really makes a PROFESSIONAL agent?  What are the elements that contribute to professionalism in an agent’s relationships with his or her clients?

 

KNOWLEDGE and EXPERIENCE:  The true professional has absolute knowledge of the subject he or she is discussing.  How do we obtain absolute knowledge?

 

Education is a good beginning.  We must be like a sieve; absorbing everything available on real estate, on law, on construction, on land use. It is always a good idea to have a greater knowledge and understanding than is required for any specific case.

 

Experience picked up in a transaction is valuable, not just for the current sale, but for the future; it must be stored in the memory bank for the next transaction; or maybe ten transactions down the line.

 

For the new agent who may lack practical experience, it is wise to never lie or guess the answer to a client’s question.   It is perfectly all right to admit you don’t know and add that you will find out,…and then do it   What you learn from the investigation is valuable information for the experience bank, for the next time the same or a similar subject comes up!.

 

PUNCTUALITY is a sign of professionalism and a super important quality of the successful real estate agent.  Not only should the agent always be on time but he or she should always be prepared. Does the car need gasoline? Does a contract need to be picked up or filled out? Is there an answer promised?  Compliance with promises and obligations helps create respect.  Delays, waiting at a notary office, having to repeat a document – all these are necessary from time to time, but should be avoided if at all possible.

 

COMMITMENT  Listen, really listen, to the needs and dreams of the client, be it a buyer or a seller.  If the needs and requirements are reasonable,  make a COMMITMENT to help the client achieve his or her objective.  If the desires are not reasonable, explain and demonstrate why they are not realistic and assist in seeking more reasonable goals.

 

LOOK AHEAD at the CONSEQUENCES;  Through experience, one learns what to reasonably expect.  Review all aspects of the transaction as it is planned.  Will it all fit together?  Will it work?  If not, why not?  What are the problems to solve? Resolve them before they get out of hand.  Be creative!

 

HONESTY:  Don’t ever try to disguise or deceive. A smart buyer or seller will suspect a problem.  It is far better to tell the truth about a situation.  The buyer or seller who wants to will often come up with a far better solution than the agent, and will talk everyone into accepting it!

 

ETHICS:  The really successful real estate agent is ethical.  Those who cut corners do not last.  The simplest way to be ethical is to ask oneself:  How would I want to be treated under the same circumstances?  This is another way to say, “Treat others as you would like to be treated”.  Following this adage it is virtually impossible to stray.  This same philosophy is expressed in the Code of Ethics of the Mexican Association of Real Estate Professionals (AMPI) and the National Association of Realtors ®(NAR).

 

THE ETIQUETTE OF COOPERATION:  With the advent of buyer’s agents and seller’s agents, everyone will benefit economically by working together.  Communication is essential and has never been easier.  The Multiple Listing systems are wonderful tools, designed to help seller’s agents promote listed properties, and buyer’s agents locate ideal properties.  Good humor and patience will go much further than anger or frustration.  Each area has its own rules of cooperation and commission sharing.  The following is a guideline:

 

  1. Buyer and buyer’s agent select the company to hold funds and supervise the transfer.

 

  1. Commissions are paid to the company where the agent works, never directly to the agent.

 

  1. Sales commissions are usually agreed upon with the Seller as a percentage of the purchase price negotiated, plus the added value tax. An invoice for services performed must always be presented to the party paying the commission, usually the seller.

 

  1. Company representing the Buyer and company representing the Seller generally split the total commission generated from the sale, 50-50.

 

  1. Referral fees – in which an agent sends a potential client to another agent, often from one area to another, will generally earn a portion of the Buyer’s or Seller’s portion of the commission. This needs to be negotiated and agreed upon between the agents and their brokers.

 

In Mexico, the law of agency is contained in Articles 273 to 308 of the Commerce Code.  A copy of these articles is available, in English and in Spanish, upon request.

 

To conclude, it is far easier to represent one side of a transaction instead of straddling the fence and trying to counsel both buyer and seller on the same property.  Not only is it easier but also, in the long run, more profitable, as the agent is able to earn respect, referrals and provide professional services to a greater number of clients.

 

about the author:

LINDA JONES NEIL has been designated as an Accredited Buyer’s Agent (ABR) by the National Association of Realtors® (USA). She is also the founder of The Settlement Company®, which specializes in real estate transfers and escrows. Licensed as a California real estate broker, Ms. Neil has pursued her profession in Mexico for over thirty years. Her skills in negotiating contracts between parties from three distinct cultures have placed her services in demand as a consultant and for speaking engagements on Mexican law and customs in Mexico, the United States and Canada. She has been widely published on the subject of real property in Mexico. She is also a founding partner in Global Mexico Real Estate Institute (IIGM) where she is an instructor for CIPS, ABR, SRES, RSPS and ePRO designations and courses. Memberships; FIABCI, AMPI and NAR.  Linda  is a former  member of the National Advisory Council of AMPI and served as Presidential Liaison from NAR to Mexico, 2011-2014.

 

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Can a Real Estate Agent Represent Both Sides?

 

DUAL AGENCY and The Real Estate Agent –

           

Can it be possible?.

 

by Linda Neil

 

In real estate the party that represents a buyer and or a seller in the purchase or sale of a property, is called an agent.  In Mexico as in other countries of the world, the agent has a duty to treat his principal in an ethical and professional manner.  The Mercantile Code, Articles 273 to 308 outline the obligations involved in representing the interests of the client.      Both law and custom make it very difficult for the conscientious agent to represent BOTH buyer and seller since the buyer wants to buy the property for the lowest price possible and the seller is looking for the greatest amount of money he can get for his property.

 

With this in mind, how can the conscientious agent honestly represent both parties?  Almost anyone will agree; there is a conflict of interest when anyone tries to fairly represent both sides of a transaction.

 

No matter how much the agent needs or wants the money that will come from a FULL commission, it is better to call in a colleague to represent one side or the other.  That way both share in the commission, both principals are honestly and fairly served and the agent will have clients who will recommend his or her services to other friends and acquaintances

 

It ends up being win-win for everyone!

 

To reinforce the relationship with buyer or seller clients it is important to understand and discuss this with the client; outline the responsibilities of the buyer’s agent, the obligations of the seller’s agent and how to handle the important issues such as money where price is being negotiated.  A confirmation of the relationship should be signed with the buyer or seller client.

 

Not only does this confirm the essentials of the fiduciary relationship, but also the clients, knowing that an agent is working EXCLUSIVELY for them, and not the other side, will be much more likely to remain loyal to his/her agent.

 

And what are the obligations and responsibilities?  Simply put, the SELLER’S AGENT has the obligation to counsel his seller as to fair and reasonable selling price, as to the importance of disclosure of defects in the property, as well as to offer the property to the widest audience possible.  The purpose of this, of course, is to obtain the highest price possible for the property.

 

The BUYER’S AGENT should assist the client in locating the best property possible which will meet buyer’s requirements.  Once located, the property should be inspected as to suitability for the purpose intended and the most attractive price and terms possible negotiated for the acquisition of the property.

 

In all cases, the agent must treat all parties with honesty and fairness.

 

Forms confirming agency relationships are available by contacting the author at the address below.

Copyright,2010-2014   Consultores Phoenix, S.C. Reproduction prohibited without permission.

 

about the author:

LINDA JONES NEIL has been designated as an Accredited Buyer’s Representative (ABR) by the National Association of Realtors® (USA). She is also the founder of The Settlement Company®, which specializes in real estate transfers and escrows, specializing in the Virtual Closing®. Licensed as a California real estate broker, Ms. Neil has pursued her profession in Mexico for over thirty years. Her skills in negotiating contracts between parties from three distinct cultures have placed her services in demand as a consultant and for speaking engagements on Mexican law and customs in Mexico, the United States and Canada. She has been widely published on the subject of real property in Mexico. Memberships; FIABCI, AMPI and NAR.  Linda  is a former  member of the National Advisory Council of AMPI and served as NAR Presidential Liaison to Mexico, 2011-2014.

 

       

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Escrow in Mexico

ESCROW IN MEXICO……………..WHY?   AND HOW IT WORKS!

 

by Linda Jones Neil.

 

What is an “escrow”?

 

When used in the context of transfer of title, the escrow generally involves three parties – the buyer, the seller and an independent third party.  It often involves the deposit of monies from the buyer and documents from the seller, to be exchanged and delivered upon the execution of the instructions.  The independent third party is often called “the stakeholder”.

 

The Buyer/Seller disbursement instructions are prepared by the escrow company in compliance with the terms of the purchase/sale contract.  They are then signed by the buyer and the seller and authorize the independent third party to handle the details of the transfer.  The escrow company must comply with Articles 273 to 308 of the Mexican Commercial Code in its dealings with its clients.

 

Some questions and answers about escrow and related services:

 

Why is escrow important?   Why can’t the buyer just pay the seller directly?

 

Funds can be transferred directly from buyer to seller and, sometimes, they are.  When strangers are doing business, however, they often feel more comfortable doing business through an independent third party.  This is especially true when the completion of a transaction involves a lapse of time from beginning to end; such as when taxes and/or liens are to be paid from proceeds, title is to be searched and permits are to be obtained.

 

What is meant by “independent third party”?

 

The company holding the funds, the documents, executing the instructions, does not have a financial interest in the property involved in the transaction.  It is not directly affected by the potential profits or losses or consequences of the purchase/sale and therefore can be more objective, more impartial, and follow more strictly the buyer-seller instructions.

 

What are the buyer/seller instructions?  (also known as the settlement or disbursement contract)

 

It is a contract for the performance of services.  What services and how and when they are performed are drawn from the terms established by the buyer and seller in their purchase/sale negotiations.  It is a contract in which each party authorizes the release of funds and/or documents upon the occurrence of certain events or the completion of certain duties and tasks.  It outlines the general conditions under which these instructions will be carried out.

 

Who are the parties to a transaction?

 

The Buyer, the Seller, and the independent third party.  Sometimes a mortgage lender is involved.  These are the principals, the main parties to the transaction and are the ONLY persons who may amend the Instructions.  As far as the handling or disbursement of funds, an Escrow Company can ONLY disburse when the Buyer and Seller direct the Escrow Company through a written, signed instruction. The Escrow Company cannot do so without consent of the principal parties. If real estate agents represent the parties they may obtain copies of documents to the transaction, but all matters are treated as highly confidential with respect to outsiders seeking information.

 

 

What if the buyer wants the sale handled through an independent third party but the seller does not?

 

Then the Instructions prepared will be “uni-lateral”, one sided, and the escrow agent will be ethically bound to protect, first and foremost, the interests of the client, buyer or seller, who has contracted for the services.

 

Can the escrow procedure be handled by long-distance or is it necessary that the parties be present?

 

With email and efficient courier services each party may be in a different town, or even in a different country!  Because the procedures and customs for transfer title, whether fee simple title, or in a bank trust, are very similar throughout the entire country of Mexico, the independent third party may be located anywhere in Mexico and the buyer and seller do not usually need to appear before a Notary Public if they have authorized others to act in their behalf.

 

Where are funds held when they are “in escrow”?

 

Buyer seller funds must be held in a separate bank account, apart from any business operating funds..    Generally they will be held in a dollar based US account with FDIC insurance available up to the maximum of 250,000. USD per depositor.   Separate US and pesos funds may be held in a Mexican bank to permit ease of transfer for payment of Mexico based fees.

Copyright, 2014, Consultores Phoenix, S.C. Reproduction prohibited without permission.

about the author:

LINDA JONES  NEIL is the founder of The Settlement Company®, which specializes in real estate transfers and escrows. Licensed as a California real estate broker, she has pursued her profession in Mexico for over forty years. Her skills in negotiating contracts between parties from three distinct cultures have placed her services in demand as a consultant and for speaking engagements on Mexican law and customs in Mexico, the United States and Canada. She has been widely published on the subject of real property in Mexico. Memberships; FIABCI, AMPI and NAR.  Linda  is a former  member of the National Advisory Council of AMPI and has served as NAR Presidential Liaison to Mexico..E-mail info@settlement-co.com,        website: http://www.settlement-co.com

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Renting a Property in Mexico

LIVING  IN A RENTAL HOME IN MEXICO…taking the big step by small measures!

by linda jones neil

 

Oftentimes it makes sense for newcomers to an area to rent a home prior to making a purchase.   This provides an opportunity to explore, to learn the neighborhoods, and then begin to understand the personality of the city or town before making a leap to a purchase and a more permanent commitment.

 

Everyday more and more foreigners, people from the U.S., Canada, Asia and Europe, have found Mexico to be an ideal location for healthy retirement.  Others have come to Mexico as a result of job transfers.  Others still, taking advantage of electronic and wireless communications, seek out delightful areas in which to live and work from their in-home offices and studios.

 

There are many areas in Mexico that offer opportunities for rentals and for retirement or vacation living:   Mazatlan, Puerto Vallarta, Manzanillo, Zihuatanejo and La Paz, Todos Santos, Los Cabos and the East Cape on the Baja Peninsula offer wonderful options on the seashore, as do Merida and the Riviera Maya on the Yucatan Peninsula.  Ajijic, Chapala and San Miguel de Allende are well established retirement areas with many rentals available.   Morelia, capital of the state of Michoacan, with its international airport and many cultural festivals is fast gaining importance as a retirement mecca.

 

In some areas, many homes or apartments may not be available for rent.  Fewer still may be fully furnished and ready for the international visitor.. It is not always the landlord’s custom to maintain the property.  A house may require fixing up, a refrigerator, a stove, basic furniture and lots of paint.   Nonetheless this can also be a fun experience for the couple who wants to learn about the area!   Rental terms can be from a few days  to indefinite, depending upon the owners.

 

Some of the questions to ask when looking for that special rental house or condominium are:

  1. What is the length of time the property is available for rental? (Some owners wish to rent only part of the year)
  2. What utilities are included in the rent? (Electricity, water, internet, cable?)
  3. What type of air-conditioning system/heating system does the property have
  4. Is telephone service available? Is cable service available?

 

  1. Is the water service reliable?

 

It is always a good idea to have a rental contract, in English, if you do not understand Spanish, which outlines the term of the agreement, the security deposit and conditions of its return, amount to be paid, extras, if any, and so forth.   This contact should be prepared by a rental management company.

 

It makes sense to contact a rental agency to assist in the search and to assist you with the details.   The professional agency will know the landlord and the time available for the rental, will be able to provide a history of repairs, and potential issues with the property.  It will also be able to help you locate the RIGHT house to meet your requirements..

. Copyright, 2010-2014, Consultores Phoenix, S.C. Reproduction prohibited without permission.

 

 

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Author Linda Jones Neil is the founder of The Settlement Company®, the first escrow company in Mexico, which is dedicated to processing the trusts and title transfers of Mexican real estate for foreign buyers and sellers for properties located ANYWHERE in Mexico. Ms. Neil is also licensed as a Real Estate Broker in California, is an Accredited Buyer Representative through NAR, and has over thirty five years of hands on experience in all aspects of Mexican real estate.  She holds membership in AMPI, NAR and FIABCI and PROFECO Certificate 00063/96.

 E-Mail; info@settlement-co.com  and website:  http://www.settlement-co.com

 

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