Sunday, December 27, 2009
stuck boat
this boat was stuck in the mud out behind our trailer this morning. Xcalak you never know what you will wake up to.
Saturday, December 26, 2009
Xcalak real estate
We lost our house after 6 months of working a deal with the owners. 8 days after one of the owners told us he was looking over the contract I got this letter
December 2, 2009
Dear John,
I regret to inform you that Xcalak Properties Inc. has accepted a cash offer on the corporations property in Xcalak. As majority shareholder, I will return the monies paid towards said properties taxes as soon as you provide either Mr. Hodges or I a secure address/bank account.
Sincerely,
Duncan Ray
so I post this info for all to read and I hope it helps.
This is good info if you are buying a house in Mexico.
If you are buying in Xcalak Mexico I would print this and take it with me when dealing with any realty companies here.
This was sent to me by a very good Mexican friend (not a gringo)who knows what he is talking about.
Dear John & Lorrie,
Again I wanted to let you know I am really sorry about how all this turned out. I honestly was in disbelief at the unfortunate series of events that took place. Having said that, I am going to limit my remarks and avoid making judgments since I am not as wise and measured as Murph is and would not be able to make a point in such good form, in turn, I´m going to make an attempt at clearing up several misconceptions about buying/selling property in Mexico so that you have more resources next time an opportunity arises and perhaps so that others can be better served.
I´m going to start with a quote out the Xcalak realty website:
“Currently, there are no licensing requirements or regulations governing agents for land sales. Unfortunately, this allows anyone to call themselves a real estate bróker. There are some people that use the prefix LIC in front of their names in front of their names in an attempt to mislead their clients into thinking that they are licenced real estate brokers. Our goal is to provide clients with accurate information that will help them through the process of purchasing property and be confident that their investment is secure”
Firstly, I would like to address the statement that affirms that there is no licensing requirements or regulations governing agents for land sales. To better understand this, we need to look at how property records and sales are regulated. Eeach state has a “Registro Público de la Propiedad” with translates literally as “Public Property Registry”, it equates roughly to your House of Records. That is where all titles or “Escrituras” are kept. An “Escritura” is a document issued by the State that GUARANTEES property rights. There are other types of titles, such as “Título de Propiedad” or “Certificado de Ocupación” that grant you some rights, but are less legally secure. Inexperienced foreign investors should only invest in property that has an “Escritura” (the property you had an agreement to buy did). If this is the case, the rules are very simple, straight forward and safe.
The main reason why there is no regulation over real estate agents is because a land sale transaction of a property with an Escritura cannot be completed independently by two individuals. One must go through a “Notario Público”. I want to make the point that these are not at all like your Notary Publics. Notarios in Mexico are very respected attorneys that are registered with the federal government and have considerable power. There is a finite number of Notarios in the county, dependent on the number of inhabitants in each place. One cannot become one unless one of them dies or retires, at which time a public announcement is made and the Notaría is up for grabs. Then a very stringent and lengthy vetting process that starts with many written tests, mainly on REAL ESTATE and SUCCESSION LAW.
One of the main attributions Notarios have is that ONLY THEM can make changes in the Registro Público de la Propiedad. This means that whenever two parties have reached an agreement and wish to carry on with the transfer of an Escritura, they both approach a Notario (of the buyers choice, of course. It is them who hires them and it is their best interest they are looking out for) and need to provide a number of documents to establish the following:
1- That the seller has unrestricted rights over the title/property. The main documents one needs to produce are the following:
a. Original title
b. If the title is in a persons´ name (with Mexicans), official ID is enough, in case of a corporation or trust (for foreigners) one needs to produce the corporation charter (where power of attorney over the corporation and it´s assets is granted to the person designated to carry out the transaction) or the trust contract with the bank.
c. Recent “Cedula Catastral” (Property ID). This is a document issued by the Registro Público which is a sorts of “Registration” of the property, it states the propery´s owner, area, limits, assessed value, etc. And it´s easily obtained for a small fee at the Registro Publico.
d. A “Certificado de Libertad de Gravamen” which literally translates to “Certificate of no leans”… so the Registro Publico will issue ANYONE with a copy of the Cedula Catastral and 220mxp pesos (around $20 usd) a certificate where it says the title is clear and that there are no leans on it.
(we were charged around $200 us dollars)
e. All property tax receipts.
f. A letter from the CFE (electric) and CAPA (water) stating that there are no monies owed to them.
2- That the buyer is legally able to purchase the property
a. If the buyer is Mexican, official ID will do, for foreigners, passport and proof of legal stay in the country (FM3 or current tourist visa)
b. For foreigners, a purchasing vehicle (corporation or trust). The charter for a corporation or Trust.
What happens then is the Notario carries out A THOROUGH TITLE CHECK. This is NOT OPTIONAL and is included in the closing costs (this is particularly important) because a “Title check” is carried out regardless (and included in the closing costs, that the buyer pays) so there is NO NEED for a second or independent “Title Check”, especially at considerable expense, since all they do is go to the Registo Publico and obtain a Certificado de Libertad de Gravamen (for just over 20usd), have it translated (it´s one page long), put it in a folder and give it to you.
Then the Notario writes up a new Escritura, that generally speaking says the following
1- States both parties names, birthdays, occupation and nationality
2- States that they want to carry out the sale of X, Y or Z lot and then ALL of the lots pertinent information
3- The value of the transaction
Lastly, both parties meet at the Notarios office. This is usually where the buyer gives the seller a cashier´s check or finalizes a wire transfer, etc. and they both sign the new Escritura.
Having an Escritura that was issued through this process GUARANTEES you BUYER IN GOOD FAITH STATUS with all and any courts, authorities and pretty much allows everyone to be safe.
Recapitulating, these lawyers take the place of a Licenced Real Estate Agent. There in no such thing as an Escrow account in Mexican law, and no person can mediate in any legal capacity to carry out real estate transactions other than Notarios.
Now, it is NOT UNUSUALL for a Realtor in Mexico to RECOMMEND either Notarios or lawyers/advisors to their clients. However, what is highly unusuall is for them to go any further than giving you their contact information. It is unheard of that they deliver quotes, bills and especially collect money in their behalf. It is considered a conflict of interest and is both unethical and illegal.
(this happened to us)
Closing costs at a Notaría are transparent and commoditized, and usually about 3% of the value of the transaction (percentage might go up for transactions for less than 100k usd, because there is a flat fee).
I would also like to make the point that in more complex real estate transaction, like those involving structured loans, institutional financing, etc, a foreign investor would probably benefit from the counsel of an independent real estate lawyer (there are some very good, bilingual ones) that are able to explain what each legal document is in terms they can understand, act as intermediaries with the Notario and especially as a person of trust that guides you through the whole process. These services are valuable and sometimes expensive, but not required in a straightforward purchase (even with a simple mortgage) like what you were attempting to do.
Now let´s address the statement where it is argued that certain people misrepresent themselves with the prefix “LIC”.
In Mexico, in order for one to be legally authorized to carry out any profession (lawyer, doctor, accountant, etc) one must be a “Licenciado”. This literally means licenced and Licenciado status is achieved after one has completed the curricula at a registered university, has written a lengthy, original research project on one´s area of expertise and has sat through a day-long verbal exam with four examiners. There is actually a document issued by the “Secretaria de Educacion Publica” that says that one is a “Licenciado”. So, whenever you meet anyone that gives you a business card with the prefix LIC before their name, the only thing that means is that they have a bachelors degree.
I hope this has been a learning experience and that you approach any future opportunities without fear or preconceptions.
All the best,
December 2, 2009
Dear John,
I regret to inform you that Xcalak Properties Inc. has accepted a cash offer on the corporations property in Xcalak. As majority shareholder, I will return the monies paid towards said properties taxes as soon as you provide either Mr. Hodges or I a secure address/bank account.
Sincerely,
Duncan Ray
so I post this info for all to read and I hope it helps.
This is good info if you are buying a house in Mexico.
If you are buying in Xcalak Mexico I would print this and take it with me when dealing with any realty companies here.
This was sent to me by a very good Mexican friend (not a gringo)who knows what he is talking about.
Dear John & Lorrie,
Again I wanted to let you know I am really sorry about how all this turned out. I honestly was in disbelief at the unfortunate series of events that took place. Having said that, I am going to limit my remarks and avoid making judgments since I am not as wise and measured as Murph is and would not be able to make a point in such good form, in turn, I´m going to make an attempt at clearing up several misconceptions about buying/selling property in Mexico so that you have more resources next time an opportunity arises and perhaps so that others can be better served.
I´m going to start with a quote out the Xcalak realty website:
“Currently, there are no licensing requirements or regulations governing agents for land sales. Unfortunately, this allows anyone to call themselves a real estate bróker. There are some people that use the prefix LIC in front of their names in front of their names in an attempt to mislead their clients into thinking that they are licenced real estate brokers. Our goal is to provide clients with accurate information that will help them through the process of purchasing property and be confident that their investment is secure”
Firstly, I would like to address the statement that affirms that there is no licensing requirements or regulations governing agents for land sales. To better understand this, we need to look at how property records and sales are regulated. Eeach state has a “Registro Público de la Propiedad” with translates literally as “Public Property Registry”, it equates roughly to your House of Records. That is where all titles or “Escrituras” are kept. An “Escritura” is a document issued by the State that GUARANTEES property rights. There are other types of titles, such as “Título de Propiedad” or “Certificado de Ocupación” that grant you some rights, but are less legally secure. Inexperienced foreign investors should only invest in property that has an “Escritura” (the property you had an agreement to buy did). If this is the case, the rules are very simple, straight forward and safe.
The main reason why there is no regulation over real estate agents is because a land sale transaction of a property with an Escritura cannot be completed independently by two individuals. One must go through a “Notario Público”. I want to make the point that these are not at all like your Notary Publics. Notarios in Mexico are very respected attorneys that are registered with the federal government and have considerable power. There is a finite number of Notarios in the county, dependent on the number of inhabitants in each place. One cannot become one unless one of them dies or retires, at which time a public announcement is made and the Notaría is up for grabs. Then a very stringent and lengthy vetting process that starts with many written tests, mainly on REAL ESTATE and SUCCESSION LAW.
One of the main attributions Notarios have is that ONLY THEM can make changes in the Registro Público de la Propiedad. This means that whenever two parties have reached an agreement and wish to carry on with the transfer of an Escritura, they both approach a Notario (of the buyers choice, of course. It is them who hires them and it is their best interest they are looking out for) and need to provide a number of documents to establish the following:
1- That the seller has unrestricted rights over the title/property. The main documents one needs to produce are the following:
a. Original title
b. If the title is in a persons´ name (with Mexicans), official ID is enough, in case of a corporation or trust (for foreigners) one needs to produce the corporation charter (where power of attorney over the corporation and it´s assets is granted to the person designated to carry out the transaction) or the trust contract with the bank.
c. Recent “Cedula Catastral” (Property ID). This is a document issued by the Registro Público which is a sorts of “Registration” of the property, it states the propery´s owner, area, limits, assessed value, etc. And it´s easily obtained for a small fee at the Registro Publico.
d. A “Certificado de Libertad de Gravamen” which literally translates to “Certificate of no leans”… so the Registro Publico will issue ANYONE with a copy of the Cedula Catastral and 220mxp pesos (around $20 usd) a certificate where it says the title is clear and that there are no leans on it.
(we were charged around $200 us dollars)
e. All property tax receipts.
f. A letter from the CFE (electric) and CAPA (water) stating that there are no monies owed to them.
2- That the buyer is legally able to purchase the property
a. If the buyer is Mexican, official ID will do, for foreigners, passport and proof of legal stay in the country (FM3 or current tourist visa)
b. For foreigners, a purchasing vehicle (corporation or trust). The charter for a corporation or Trust.
What happens then is the Notario carries out A THOROUGH TITLE CHECK. This is NOT OPTIONAL and is included in the closing costs (this is particularly important) because a “Title check” is carried out regardless (and included in the closing costs, that the buyer pays) so there is NO NEED for a second or independent “Title Check”, especially at considerable expense, since all they do is go to the Registo Publico and obtain a Certificado de Libertad de Gravamen (for just over 20usd), have it translated (it´s one page long), put it in a folder and give it to you.
Then the Notario writes up a new Escritura, that generally speaking says the following
1- States both parties names, birthdays, occupation and nationality
2- States that they want to carry out the sale of X, Y or Z lot and then ALL of the lots pertinent information
3- The value of the transaction
Lastly, both parties meet at the Notarios office. This is usually where the buyer gives the seller a cashier´s check or finalizes a wire transfer, etc. and they both sign the new Escritura.
Having an Escritura that was issued through this process GUARANTEES you BUYER IN GOOD FAITH STATUS with all and any courts, authorities and pretty much allows everyone to be safe.
Recapitulating, these lawyers take the place of a Licenced Real Estate Agent. There in no such thing as an Escrow account in Mexican law, and no person can mediate in any legal capacity to carry out real estate transactions other than Notarios.
Now, it is NOT UNUSUALL for a Realtor in Mexico to RECOMMEND either Notarios or lawyers/advisors to their clients. However, what is highly unusuall is for them to go any further than giving you their contact information. It is unheard of that they deliver quotes, bills and especially collect money in their behalf. It is considered a conflict of interest and is both unethical and illegal.
(this happened to us)
Closing costs at a Notaría are transparent and commoditized, and usually about 3% of the value of the transaction (percentage might go up for transactions for less than 100k usd, because there is a flat fee).
I would also like to make the point that in more complex real estate transaction, like those involving structured loans, institutional financing, etc, a foreign investor would probably benefit from the counsel of an independent real estate lawyer (there are some very good, bilingual ones) that are able to explain what each legal document is in terms they can understand, act as intermediaries with the Notario and especially as a person of trust that guides you through the whole process. These services are valuable and sometimes expensive, but not required in a straightforward purchase (even with a simple mortgage) like what you were attempting to do.
Now let´s address the statement where it is argued that certain people misrepresent themselves with the prefix “LIC”.
In Mexico, in order for one to be legally authorized to carry out any profession (lawyer, doctor, accountant, etc) one must be a “Licenciado”. This literally means licenced and Licenciado status is achieved after one has completed the curricula at a registered university, has written a lengthy, original research project on one´s area of expertise and has sat through a day-long verbal exam with four examiners. There is actually a document issued by the “Secretaria de Educacion Publica” that says that one is a “Licenciado”. So, whenever you meet anyone that gives you a business card with the prefix LIC before their name, the only thing that means is that they have a bachelors degree.
I hope this has been a learning experience and that you approach any future opportunities without fear or preconceptions.
All the best,
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