This explanation of the closing process has been prepared based on a basic operation of a standard cash transaction; of course there are many variables that can occur at the time of a sale. 

All our efforts will be made to close the transaction in a timely manner. 

The process is subject to the Mexican requirements for the sale of a property, as well as the availability of the trust bank, ministry of foreign affairs, the parties involved, closing coordinator, notary, etc. 

The process has been simplified over the years by the Mexican government; During the entire process and once the transaction is completed, you can be absolutely sure that your investment will be protected. 

Step 1 – Offer signed and accepted:
1. Buyer and seller make the offer to acquire a property, which constitutes an accepted offer for the sale of the property. 

2. The buyer makes an “escrow agreement” with the Escrow company. The real estate agent will be in charge of delivering the escrow notification letter with the offer, the seller and the buyer must provide a copy of their passport and license, among other documents. 

Step 2- Period of procedures.
1. As normally indicated in the offer, the buyer will make the agreed initial deposit, plus the Escrow fee, previously stipulated in the offer. 

2. Our real estate consultants will deliver the accepted offer, Escrow notification letter, identification of the buyer and seller, documentation of the property of the current owner, to the closing office and / or Closing Company. 

3. The closing office and / or Closing Company will contact the buyer through a notification when the initial deposit has been received, will provide an estimate of closing costs, additional settlements and information on the closing; they will work with the buyer to determine how they will take title to the property. They will also work on all the procedures, requirements and conditions established in the offer. 

4. Our agents will work with both parties, including the Closing Company, seller and buyer, to remove any contingencies, finalize inspections or inventories, etc. And to remove all the conditions that could delay the initial deposit. 

5. Once the buyer is being committed to continue with the sale of the property, our agents will provide the instructions to make the bank transfer and Escrow agreement for the buyer for the initial Deposit (Earnest Money). 

6. If the buyer decides not to proceed with the transaction, the agent must facilitate the return of the initial deposit and notify the seller, then the operation will be canceled. 

Step 3– The initial deposit (Earnest money) / The processing period ends.
1. The buyer enters into the Escrow Agreement, a standardized agreement with the Escrow company.
2. The buyer deposits the funds in the initial deposit, as indicated in the offer. 

3. The additional buyer deposits the cost share on PRE-Closing. This fee applies to closing costs during closing and compensates for pre-closing costs, permits and requirements.

4. If the buyer does not deposit the Earnest Money, Broker will deliver a notification to the real estate agent, Escrow, buyer and seller, and the buyer will have days to deposit. If the deposit is not received within 5 business days and there are no extensions negotiated, the transaction will be canceled without future liability for the buyer or seller, and the initial deposit must be returned to the buyer by the Escrow Company. 

Step 4– Transfer of title.
1. Buyer and seller will provide all the pending documentation to the closing company, to 

complete the operation, this will be delivered before a notary and to the trust bank. 

2. Closing Company will deliver to the notary and the trust bank all the requirements and documentation of the operation at the notary’s office, who will carry out the legal process of the transaction. The notary will be available to answer questions to the buyer or seller at any time. 

3. The notary will prepare an estimate of the capital gains tax for the seller’s review. Taxes are calculated on the value of the peso at the time of the seller’s purchase (base cost), and the price of the property based on the estimated value of the peso on the dollar, at the time of closing. 

4. The notary’s office will prepare the letter of instructions from the trust bank, for the signature of the buyer and seller. These letters are notifications for the trustee bank, that the property has been sold, the terms of the sale and acquisition, the appointment before a notary’s office as official supervision of the sale, to sign the deed or property title, the closing of the seller and buyer . This letter will be delivered to both parties with instructions on how to have the documentation authenticated based on Mexican law. 

5. Within the requirements of the letter of instructions, seller and buyer, the notary requires a foreign immigration permit. Foreign Affairs Permit (FAM), from the Ministry of Foreign Affairs, a requirement for any foreign buyer in Mexico. 

6. The notary’s office will prepare the deed or title subject to the Trust (trust deed), for the review of the trust bank, as well as all the parties. 

** FIDEICOMISO **:
The “Trust Deed” – TRUST, is the mechanism for the acquisition of properties for foreigners (Non-Mexican citizens) in Los Cabos, as well as all coastal areas and borders in Mexico. The appointment for the Fideicomiso (Trustee) is generally determined by the notary and will probably be the same Trust as the seller, for cost and continuity reasons. The sole responsibility of the Trustee is to maintain the trust deed on behalf of the beneficial owner, and act according to his instructions. The property held in trust is not considered an asset of the trust bank, according to the Law and the Mexican Constitution. Also if there is an existing trust, the rights of the beneficiary can be assigned. If the buyer is Mexican, the trust is canceled and if both are Mexican, the deed is transferred. One of the benefits of the Fideicomiso, in the event of the death of the trust owner, the property automatically passes to the beneficiary that the owner has assigned, without the need for a will. If you want to know more benefits of the Trust, consult one of our advisors. 

7. After reviewing and accepting the trust deed, as well as the additional documentation to the closing requirements, the trustee bank will authorize the notary’s office to carry out the trust with the authorized parties. 

Step 5 – Settlement and closing. 

1. Once the notary’s office receives the letter from the trust bank and authorization to close on behalf of both parties, the notary prepares the notification to the buyer to deposit in the Escrow within 5 business days, of the established closing date, or as soon as may be possible. 

2. Closing Company will prepare the buyer’s settlement and seller’s review, as well as the buyer’s final transfer instructions, with the final deposit in Escrow. 

3. Buyer and seller authorize to sign the settlement statement, which will be delivered to Escrow. 

4. The buyer deposits to escrow the balance of the purchase price, balance of closing costs, and any additional fees or negotiations. 

5. Once the Escrow’s written confirmation that the funds agreed in the offer have been deposited, and the settlement statement, the notary will complete all the necessary documentation to transfer the title and obtain the required signatures from the trust bank, as well as those of the buyer and seller. 

6. The notary will deliver to the Escrow the documents: Copy of the deed executed in favor of the buyer, certifying freedom from liens and taxes, preventive notice of sale in the public registry, in favor of the buyer, and a confirmation letter that the title / deed has been duly transferred by the seller to the buyer in accordance with Mexican law. 

7. The Escrow will review all the documentation received by the notary, verifying all the conditions in the escrow agreement for the release of funds and in 2 business days all funds will be released according to the Escrow Agreement and the settlement statement executed between buyer and seller. 

8. This operation has been successfully closed.