Home Expat Blogs Make Sure Your Paperwork Is Correct When Selling Real Estate in Mexico...

Make Sure Your Paperwork Is Correct When Selling Real Estate in Mexico  

1071
0
Bar in Puerto Vallarta
Credit: Harriet Murray

You have discovered that your address or name in the deed does not match what is on your phone or electric bill.  Yes, the bills get to you or to the person who pays them, but this mistake can be a problem when you decide to sell. Make sure your paperwork is correct when selling real estate in Mexico!

The system we usually follow before we decide to sell doesn’t have the checks and balances it should. Your paperwork trail needs to satisfy the notary. He/she has to have everything needed to not only establish a clear picture of you as the owner, but has to have a documented history of your utility use in the property. Your utility bills must match your legal address in your deed.  Everything has to match!

After you purchase a property, you should have in your possession:

1. A copy of the deed (fideicomiso escritura) with the stamp of the notary on the pages.  If you are not at closing, you still need a temporary copy of the deed, which is not recorded yet (but shows the signature of the seller).

The bank trustee has to travel to the notary office to sign acceptance of your trust. Then the deed will be sent to the public registry for recording. It will take several months as a minimum for it to be recorded and sent to the notary.  Plan how you will get this document back when it is recorded. Ask about this very important detail before the closing date.

2. You should note in your calendar when to check back and find out if the recorded escritura is at the notary office and pick it up when you are back in town.  It is a good idea to request an additional certified copy of the trust before you pick up the recorded deed.  Put the recorded deed in a safe place and use the certified copy to open accounts or conduct business where proof of ownership is required. This certified copy is not inexpensive. Find out the cost before the closing is over.

3. Ask for your factura (official receipt) from the notary or make arrangements to receive it when the deed is picked up. This receipt shows all the expenses you paid the notary as part of your closing costs. Some of these expenses can be deductible when you sell.Keep it with the escritura in a safe place. You do not need to make a copy to provide to anyone else.

4. Get the original or a copy of your predial, or tax statement, for the year you close.  You will need this account number to check what your taxes are in January of the following year.

5. Set up your electricity and phone accounts.  You want the seller to TRANSFER the accounts to you at closing, not to close them.   Open your accounts using the legal address in your escritura.  Whomever opens these utility accounts should be very sure the legal address matches exactly what is in the deed. Double-check the address on the utility bill when you receive it for the first time in your name.

6. Your utility bills are one of the proofs the notary will want to see if you are claiming partial exemption of capital gains tax when you sell. You need the original utility statements and the paid receipt attached or stamped as paid. If you pay online, you must still keep the statements, which should at some point be mailed to your address.

This article is based upon legal opinions, current practices and my personal experiences in the Puerto Vallarta-Bahia de Banderas areas.  I recommend that each potential buyer or seller of Mexican real estate conduct his/her own due diligence and review.

LEAVE A REPLY

Please enter your comment!
Please enter your name here