It sounds complicated, but taking title to oceanfront property is actually safe, inexpensive, and easy. Mexico's Foreign Investment Law and the North American Free Trade Agreement (NAFTA), enacted January 1994, established a legal figure called a “Fideicomiso,” giving foreigners a way to legally own border and beachfront property in Mexico.
The fideicomiso is essentially a beneficial trust wherein property is the asset held in trust (property title is in the name of the trust); an authorized Mexican bank serves as the Trustee, and the foreign owner-investor is the Beneficiary and owner of the trust. The Trustee only administers the trust, while the Beneficiary has full possession and use of the residential property held in trust, and she may mortgage it, assign it, will it, lease it, or sell it. The trust contract has a term of 50 years and is automatically renewable for additional 50-year periods. A built-in perpetuity safeguard is also provided through an option in the trust contract which allows for automatic property transfer to heirs specified therein (noted as substitute beneficiaries). As in any trust, the bank charges a set up fee and an annual fee for trust administration. In the years since the implementation of the fideicomiso system of foreign ownership of coastal and border properties, thousands of trusts have been initiated, and foreign investment in this area has grown tremendously.
Foreigners can also form a registered Mexican corporation to take ownership for property along Mexico's beachfront.
Our group of professionals can help you decide which form of ownership is best for you and will be happy to help you form your trust or Mexican corporation.