So you have found your dream vacation or retirement home in the Costa Maya, and now you are ready to buy it, … but okay, what do you do now? Not many choices to help with your purchase, so many are always asking, if we don’t want to use a local Realtor, who can we get to help us with the contract and escrow process. As I’ve written about in other blogs, because using local real estate companies have been historically risky, while providing really bad service, or even worse, it is often better to have an attorney do the legal work for your transaction. Why not, you’ve done part of the Realtor’s job and found the property yourself already anyway.
The area is very small, and the internet very large, so many now prefer to find the property themselves, and then just pay an attorney to write the contract and oversee the escrow process with the notario. Many of the consulting services we provide, like construction and business planning, require lot purchases, so we too, use attorneys for our clients’ land purchases. Most get the job done but some are better than others, and ours, Moises Gongora, has proven to be, head and shoulders above any others, in service and high quality work.
What I mean is that he can complete a transaction properly, make sure the process is understandable for all, the buyer and seller, as well as provide the high quality customer service, that makes the process easy and fast. He is bilingual, and works in both Spanish and English, and does so in a cost efficient manner, that is less than you pay in real estate commissions. If you can hire an attorney for less than a Realtor, why would you not do that?
Moises works with SLS Strategic Services in Playa del Carmen, where his specialty is real estate law. There he sets up corporations and fedeicomisos, drafts contracts, and processes escrows for everything from large Cancun developer’s properties, to individual property purchases. The services his firm can provide, seem to far out perform most Realtors I’ve seen here, from the contract process, all the way through the Notario’s closing of the escrow. But their services start before the contract and can go even beyond, if your needs require. SLS has extensive experience in consulting, advising and managing projects related to tourism and hospitality, as well as real estate.
So what can Moises do before the contract that most Realtors don’t? Really simple. He checks the seller’s tax debt on the sale, and that debt is either addressed before the contract is even written, or in the contract itself. If you know Mexican real estate you know why, but simply put, one of the largest “deal killers” here in Mexico is the surprise capital gains tax almost all sellers must deal with when they sell. I am shocked at the number of times I’ve seen deals fall through at the last minute because the seller could not complete the sale, due to a large tax debt. This should never happen, and when one of our clients is purchasing property here, we always request the info needed to know the tax debt on the sale before we start. Moises service does that automatically too with every purchase.
However, it is the contract and escrow process that is most important, and his is a very well set up machine. His contract is of course in Spanish, the only language in which a legal contract in Mexico can be written, however he provides a side by side, translated “courtesy contract” that allows the English speaking parties, to understand fully what they are contracting. The contract is written in much the same way as a US contract, but for us, the best part is the contract is amendable. This allows us to tailor the transaction to the situation and participants better, and always produces a smoother transaction.
For example, if the sale is on a property with a simple and clean title, like developed city property, and can be done in just a few weeks, we often can negotiate a deal with no earnest money. In the US, every real estate company or attorney who does real estate transactions, is required by law to have a trust account, meant specifically for holding earnest moneys. The trust will only release the money under the terms written in the contract, so going into a deal, all understand clearly and have confidence in the safety of the money from graft. Not the case here, and the road out of town is littered with the bad stories of Realtors who did not handle earnest money properly, because they are not required to. Moises has banks that can set up trusts in the same manner, but it is a cost, and one that because of SLS’s faster processing time, we can sometimes avoid.
We try to negotiate a contract that allows for a short discovery period, less than a month, with no earnest money, that allows the buyers to check the property, both physically and legally, and at that time, decide if they want to complete the transaction with a deposit and terms concerning that deposit. If the property can be closed in a short period after and all are ready, often, again, no earnest money is needed. If either party then needs more time to get ready to close, we negotiate a deposit and the terms depending on who needs more time. In other words, Moises contract is flexible enough, and his ability to work with our individual situation is such, that for our needs, he is perfect.
He also very much understands and appreciates the importance of making the process easy and convenient, and his volume work with his chosen couple of notarios, helps him do that. Having a working relationship with his select notarios, allows his escrows to slide through the process easily, where others take much longer due to confusion and poor coordination. My clients’ single purchase escrow, gets the same attention, as the high volume builders for whom he provides the same service. He also understands clearly their fees, and makes sure that the Notarios closing costs will not surprise you at the end. By using Notarios in both Cancun and Playa Del Carmen, people can fly in and out, and often do papers in one day. They even do valet service and can do signings at the airport if need be.
When you buy a property via a Realtor, they charge a commission, usually at least 6%. Some, as high as 10%. Most buyers are surprised to find that Notario fees are on top on their commission. Which means your Realtor does the same work as Moises, if you are lucky, and for more money. Moises’ fees are based on the time needed to do the title research and such, but most purchases can be done, from contract to close, for between 3% and 5% of the cost of the sale. The larger the sale price, the lower the percentage. For small purchases, much of the work is the same, so the fees calculate to a higher percentage. Developed lots, with easy legal history, is less time consuming, and therefore, also less costs to the client. Each purchase is a little different, but never is it more than Realtor commissions, and you will know all the costs before you get started. If all things are equal, or better, why pay a Realtor, when you can pay a Real Estate Attorney.
In my years here, if I had a taco for every complaint I’ve heard about people’s real estate transaction problems and headaches in Mexico, I’d be … well, fatter than I am, that’s for sure. Read my blog here on why the lack of regulation, especially in this more remote area, has left us with a sad history of bad transactions by poorly trained, or even some, dishonest Realtors. If you are buying or selling real estate in Mahahual, and want English speaking, full service, real estate and legal services, you can contact Moises via email at: Moises.firstname.lastname@example.org .
Thanks for reading!