If you’ve been thinking about buying property in Mexico, congratulations!
Mexico is an amazing country full of exciting culture, great food, vibrant music, beautiful weather, and best of all, rising property values! At Zisla, we specialize in helping foreigners navigate the property market, and by simplifying what can seem like a complicated process to outsiders.
We can assure you, it’s not as complex as it seems at first glance! As a part of that process, in this blog we’re breaking down what you need to know about the role lawyers and notaries play in Mexican real estate.
Once we’ve enlightened you, don’t forget: We can also help you find your dream real estate investment. We’ve helped thousands of foreigners find the perfect property to suit their lifestyle and budget. Will you be next?
What is a Notary?
In Canada and the United States, a notary is a person authorised to perform acts in legal affairs. Specifically, they are responsible to witness and authenticate the signature of documents, which is referred to as notarization.
Often, the role of a notary public is to verify the identity of a person signing a document, but they do more than that. Notaries can also take testimony, write affidavits, administer oaths, deal with matters concerning estates, and perform other official acts, depending on the jurisdiction.
It is important to note that notaries are not responsible for reviewing the content of any of the paperwork or determining its legality. The act of applying a notary seal is simply for verification purposes.
What is the Difference Between a Notary and a Lawyer?
A lawyer can represent you in court. Lawyers can also be involved in litigation. Notaries, however, only usually handle non-contentious legal matters, which are matters in which all parties have already reached an agreement.
While notaries can offer legal advice in some contexts, most often notaries only come into play when two parties need a legal witness to advise and arrange the proceedings of an agreement. Notaries often deal with real estate matters, but also work with wills and estates, contracts, power of attorney, and other matters.
What is a Mexican Notary?
A Mexican Notary, or notario, is different from a Canadian or American notary.
They are typically experienced lawyers that have been selected and appointed by the Governor of a Mexican state. They are only selected after having successfully practiced law and completing a rigorous application process. Mexican notaries public must pass a stringent exam and meet all of the qualifications set out by the government.
Aside from working with real estate transactions, notarios can authenticate powers of attorney, company deeds, banking, insurance and bonding documents, as well as birth, marriage, and death certificates.
Notaries in the United States, however, do not necessarily have formal legal qualifications. A Public Notary in the US can’t give legal advice, for example. In Mexico, only some lawyers ever end up becoming notarios, and those that pass the tests have to enter a waiting list for the next available license - a wait that can take years.
Who Does the Mexican Notary Work For?
The Notario is a neutral person. He or she works for the buyer, the seller, and the government, all at the same time.
What is the Role of a Mexican Notary in Real Estate?
Notarios provide security for original records and documents, and are responsible for filing the documents with the Public Registry of Property. A Notario can be held liable in both civil and criminal terms.
During a real estate purchase, the Notario Publico will authenticate all the legal documents, the transfer of the property’s title, and will calculate the capital gains tax as well as ratify the real estate transaction.
In Mexico, if a real estate transaction was not recorded in the Public Registry by a Notario, it is not valid.
How Can a Notary Help Me When Buying Property in Mexico?
Whether you’re going to buy property, open a business, create a company, notaries can be invaluable partners. Besides authenticating certain documents, they can also help advise you, as well as interpret, write, read and explain elements related to the matter at hand.
With respect to real estate transactions, Mexican notaries will identify the buyer and seller, make sure to explain any of the content of the contract to you, and help determine the characteristics of the property you are purchasing, including tax liabilities. Notarios publicos will even arrange the payment methods you will use to complete the transaction, as well as review any paperwork related to the deed.
In other words, they make sure that as a foreigner buying property in Mexico, you have fulfilled all the necessary requirements, paid all the necessary taxes, signed all the appropriate documents, and delivered those documents to the Public Registry so that you are the new official owner of your dream Mexican real estate.
What is the Lawyer’s Role in Mexican Real Estate Transactions?
As opposed to a Notario, who is responsible to work with all parties (buyer, seller, government), a reputable lawyer will represent only you during the transaction. The lawyer will also ensure there is no human error, that your property title is properly registered, and take care of all the necessary due diligence on the property.
Even though a notario publico is required to finalize any real estate transactions, it is still highly recommended to get a lawyer. The lawyer will protect your investment, save you time and money, and connect you with any other necessary professionals, such as financial institutions or insurance companies. Your lawyer should provide what’s called a Title Guaranty, verifying the title is free and clear, and that the purchased property is not encumbered by liens or cannot be owned.
What is the Due Diligence Process in Mexican Property Transactions?
This is one of the most vital steps of purchasing real estate in Mexico. Due diligence refers to the process described above, where you are guaranteed that you will not lose possession of your property after it is purchased.
Due diligence involves ensuring that you receive a Title Deed on your property, and this is important because Mexico typically has far less information regarding properties and ownership available to the public than they do in Canada, the United States or Europe. For example, they don’t have the same level of technology that makes it easier to record the transactions, liens, and chain of ownership.
Learn More From Zisla
If you’re interested in buying Mexican real estate, Zisla can help.This remains true whether you want to buy a vacation home, a place to enjoy your retirement, an investment property to diversify your income streams, or even if you’re on the hunt for the perfect plot of land upon which to build the home of your dreams.