Know THIS When Purchasing Property In Mexico
Video Transcript - (Speakers: Alex Koper & Anthony Young)
Anthony: It is Anthony Young over here at MoXi, and I'm taking a very special opportunity to talk with our CEO, Alex Koper, about some common questions that I'm getting from my clients concerning buying real estate in Mexico. Very happy to have Alex set some time aside today to answer some of those things.
Alex: Well, awesome. I'm really excited to be here. Thanks so much for setting this up, Anthony. This is going to be fun. I don't often get to hear every day what are common questions that clients and potential clients have about what we do. So pretty excited to hear about those.
Anthony: I think the first one that I hear a lot is, what are the most important things for folks to know when financing a property in Mexico? There's a lot of questions, misconceptions, and wives' tales even. I want to maybe get your input, what you see and what you hear.
Alex: Yeah, that's a great question. And you're right, I think I hear and see a lot of misconceptions across the landscape of foreign buyers or potential buyers, or even people that already own property in Mexico. There's a lot of those misconceptions or wives' tales out there, and I think that's where a lot of the questions come. So one of those that's really interesting is this notion of a land lease, or that foreigners aren't actually legally able to buy property in Mexico. So there's a 99-year land lease and they're not actually owning what they're buying. They can't pass along the asset to a future generation, which is just totally not true. And I think what's cool about this is really if we look back at history, so I believe it was in the mid-'70s, 1970s, the Mexican constitution was amended, allowing for foreigners to own property across all of Mexico.
So ownership was still allowed in non-restricted zones, but this constitutional amendment or adjustment that was made, allowed foreigners to actually own property inside of those restricted zones. And restricted zones are within a hundred kilometers of a border or 50 kilometers of a coastline. And that amendment to the Constitution enabled foreigners to actually own property in those restricted zones in addition to the rest of the country of Mexico. And that's done via the Fideicomiso. So it's a slightly different way of setting up the structure, but it's very, very common in Mexico. So those folks that already own property and maybe are contacting us about getting liquidity, cash out, refinance or refinancing an existing mortgage, likely already have a Fideicomiso and own the property that way. But new clients or folks that are thinking about purchasing property in Mexico maybe have heard some of these misconceptions before. So I'm really glad you asked that. Thank you.
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