Bank Trust History

Bank Trust History

Mexico is now rated one of the best countries for investment opportunities in real estate growth as well as one of the safest for real estate investments. Foreigners can own coastline land anywhere in Mexico with Trusts held in Mexico Banks. These trusts are set up with 50 year renewable beneficiary rights without limitations. Foreign land owners and homeowners can enjoy rights of ownership equally protected by the Mexican government.

In the past, Mexico had problems with foreign investors due to uncertainties in land title, which resulted in many foreigners being discouraged by ownership complications. There were also restricted zones, which consisted of any land within 50kilometers of the coastline and 100 kilometers from any international border. To encourage foreign investment, in 1973 Mexico adopted a Bank Trust system called Fideicomiso, which permits to buy and own coastal and border properties through a bank trust.

This allows foreigners to exercise complete control over real estate in the restricted zones. Under the Fideicomiso, the Mexican Bank through the trust, hold the title to the property in any restricted zone. Just like in the United States, the owner who is the beneficiary of the trust, administers the trust and therefore controls the property. He or she may transfer ownership, lease or improve the property at will. Foreign owner may also instruct the trust to pass the property to future generations without the cost of inheritance tax.

Mexican law also protects trust beneficiaries from any problems the Bank may have. Never can a trust be seized to satisfy judgments against the bank. In 1994 Mexican law established that Trust Deeds are to be for 50 year terms with and are renewable indefinitely in 50 year increments. Mexican notaries are appointed by the government to control all recordings and documentation or real estate corporate and private records regarding transfers of ownership.

Notaries also perform title searches similar to American title companies and guarantee your property to be unencumbered. Fideicomisos are solid protection for your investment capital and has reshaped the Mexican tourist industry into one of the best places on earth to park your money.

Foreigners may also own rental properties or other businesses which own property by forming a Mexican Corporation owned by foreigners. In this case the Mexican Company, which would hold the title, owns the property and a trust with a bank are not needed. Though the only benefit would be a few hundred dollars for annual trust fees. The closing is performed by the Notaries and most properties only require 30-60 days to complete the closing process. Though it might take considerably longer to receive the bank trust or actual title. You can purchase Title Insurance for about 1% of the purchase price but this generally not needed with the purchase price but this generally not needed with the Notary system. Notaries are government appointed attorneys trained specifically to handle legal matters in property transfers.