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Owning a Vacation home in Los Cabos is like a dream come true and easier than ever before, and the Oceanside Real Estate Group is happy to explain how the process works so you can feel comfortable making the next steps as choose where you want to spend your time.
Here is some information to know before purchasing your new Cabo vacation home:
1. Foreigners US/CA citizens can purchase property in Los Cabos with a Fideicomiso…
2. What is a Fideicomiso? It is a Mexican Bank Trust which allows foreign citizens to purchase coastal property within designated regions of Mexico, this is an instrument used for non-Mexican nationals, such as U.S. citizens and Canadians to purchase property in Cabo.
3. How does the Bank Trust Work? – The Mexican Government issues a permit to a Mexican Bank allowing the bank to act as the purchaser of the property. The bank serves as the “Trustee’ for the Trust and you are the “Beneficiary” of the Trust. The Beneficiary rights are very similar to Living Wills or Estate Trusts in the U.S.A. The trustee takes instructions only from the trust beneficiary (the foreign purchaser). The Beneficiary has the right to use, occupy and possess the property, including the right to rent, build on or otherwise improve it as it is yours in perpetuity. The Beneficiary may also sell the rights and instruct the trustee to transfer the title.
4. Most properties in Los Cabos are purchased with a Cash Investment.
5. Long-term financing is now available for US/CA citizens on move-in-ready homes and condos.
6. Many Sellers are open to Seller financing with interest only payments and balloon payments paid at the balance within 12-24 months when purchasing through a Guaranteed Trust.
7. You can purchase the property as an entity (LLC), Family Trust, or as an individual where you are the beneficiary of the bank trust.
8. We advise Purchasers to use a Third-Party Escrow company for the sole purpose to HOLD funds until the final closing date where funds are only released through disbursement instructions signed by both parties. We recommend Global Escrow Solutions based out of Austin Texas to hold your funds and release funds at closing through disbursement instructions. However, there are other reputable Escrow companies to choose from.
9. We recommend building a 10-15 business day due diligence period to allow time to get a home inspection and review HOA information, and any community rules and regulations so you have peace of mind.
10. How long does it take to Close as a Foreigner? Once you have an accepted offer it can take about 60-90 days. This really depends on how quickly you complete your due diligence period and make your earnest money deposit.
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