How to Invest in Property in Mexico: The Fideicomiso (Part I)
Can foreigners buy real estate in Mexico?
Yes, but there are legal restrictions in “restricted zones” near the coast and borders. Foreigners can still purchase property in these areas through a legal mechanism known as a fideicomiso, or bank trust. This article explains how it works and what to expect as a foreign investor in Mexico.
Who is involved in the fideicomiso?
- Fideicomitente: the property seller.
- Fiduciary bank: a Mexican bank authorized to hold title.
- Beneficiary: the foreign buyer, who holds full rights to use, lease, sell or inherit the property.
Costs and duration
The trust permit from the Ministry of Foreign Affairs (SRE) costs around MXN 20,000. Annual bank fees and setup costs average around USD 2,500, depending on the institution. The fideicomiso is valid for 50 years and renewable.
Which banks can issue a fideicomiso?
Some commonly used banks include:
- Banco del Bajío
- Intercam
- Monex
- Banorte
- Scotiabank
Processing times for the SRE permit usually range from 3 to 5 business days.
Requirements
To establish a fideicomiso, the following documents are typically required:
- Valid passport
- Current immigration form
- Property title
- Seller’s documents
- Bank trust application form
Step-by-step process to buy through a fideicomiso
- Choose a property in a restricted zone
- Sign the offer to purchase
- Select a fiduciary bank
- Apply for SRE permit
- Verify title and legal status
- Prepare notary documents
- Sign the fideicomiso agreement
- Pay applicable fees and taxes
- Sign the deed before a notary public
- Register the deed with the Public Registry
- Receive a certified copy of the deed
Conclusion
The fideicomiso is a solid and legal structure that allows foreigners to safely invest in Mexican real estate. Understanding the players, the costs, and the timeline helps ensure a smooth transaction.
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