BajaNomad - Fideicomiso questions

Fideicomiso questions

highsierrabum - 5-17-2008 at 06:15 PM

So, I'm sure there's been a million posts regarding the Fideicomiso process, and I have done some browsing but, I'm wondering if there is someone out there who can give it to me straight...I am poor and cannot afford consultation services, and I want to take care of my fideicomiso on my own rather than through a real estate agent....

1. From what I've read it's sounding like I DO NOT need an FM3 before applying for a fideicomiso, that a tourist visa will suffice, but that I should apply for an FM3 once I have my fideicomiso in order to have legal rights under the mexican government should there ever be any disputes etc? Is this correct information? I was told this winter in Baja, that the first thing I should do is get an FM3 BEFORE starting my Fideicomiso, What is the truth?

2. Can anyone give me a simple bullet list of the steps involved in the process from start to finish? What do I do first? From what I've read I first need to go to a Bank of my choice in Baja Mexico and ask to open a trust with the bank....let me know if this is correct and what happens after that, what documents I will need etc.....

3. What paperwork do I need from the seller to open a trust with the bank? I have official receipts for the sale of the terreno showing the down payment, the total, what is owed, and the seller's signature. I have been told that the seller must provide a "map" of some sort before I can open a trust. What is this "map"? and do I need it to begin the fideicomiso process. My land has been surveyed, but I have not been given any sort of map of the property. I have wanted to move very slowly in order to have time to save up the rest of what I owe and the seller is fine with this and therefore has not moved forward on anything on their end until I'm ready, but on my next trip I want to start moving forward on the paperwork, so should I contact them regarding this map before arriving in order to give them time to have it made, etc?

I am buying a hectare within a large parcel of private property held by a member of the ejido. It is under his name only. He received the rights to the property during parcelization of the area in the mid ninties.

I know there is a lot of information out there about all this, but I've noticed variations in the info and there's almost too much of it....I'm looking for a simple blow by blow account of what I need to do to begin the process of buying my land uner a fideicomiso....

thanks to whoever undertakes replying to this question......that next Pacifico Ballena is on me....
cheers
-dave

DENNIS - 5-17-2008 at 06:27 PM

Hi Bum....Welcome to BajaNomad.
Your #1 question will get a lot of different answers. Seems like no process follows the same guidelines in Mexico.
That's all I know. Do I get the Ballena?

CaboRon - 5-17-2008 at 06:27 PM

The Fideicomiso I believe has to be drawn up by Notiro Publico.

Ejido land must be converted .... big red flag here

No money should change hands before the sale is complete ... your present receipts will not protect you.

Can someone else take it from here ??? Thanks, generally I would say stay away from Ejido land.

Take it away guys.

CaboRon

bajaguy - 5-17-2008 at 06:32 PM

Regarding the FMT/FM-3. you are correct. Your FM-3 needs to show your "residential address". get the FM-3 as soon as you get some paperwork that establishes your residency. Water, electric or telephone bills; property sales receipts or a sales contract showing money down or amount paid in your name and the address of the property.

highsierrabum - 5-17-2008 at 06:40 PM

in response to the ejido land "big red flag"
my situation is not typical "ejido land", it is owned under one name, not the entire ejido, it is private property, and several sales have been concluded with ease already including one fideicomiso and a few corporations. so the usual nightmare of ejido land stuff does not apply here.

also, please
i've gotten enough of the half baked repsonses to my questions during my past five month stint south of the border...and unlike what people seem to think, the fideicomiso process is relatively set, I know that much at least and would simply like to hear directly from those that really know and want to give the time for an adequate response to my questions....

at the very least just tell me what steps you followed when you got your fideicomiso....what should i do first, second, third etc....thanks

a ballena is still waiting in the wings.....

DENNIS - 5-17-2008 at 06:54 PM

I guess that means I don't get a Ballena.

CaboRon - 5-17-2008 at 07:22 PM

Quote:

Originally posted by DENNIS
I guess that means I don't get a Ballena.

And neither do I Dennis ....

Sounds like he knows more than you or I :yawn:

CaboRon

comitan - 5-17-2008 at 07:43 PM

To start with you should get an FM3, after that you need to go with the person selling the property to a Notario,to get the title officially transfered, and since you will still owe on the property you will probably just get a power of attorney till the property is paid for. after that to any Mexican bank and they will do the paperwork for your Fido.

Don Alley - 5-17-2008 at 08:14 PM

I can't remember all the steps we took or the order we did it, but...

We made a roughly 10% down payment, with a handwritten receipt, essentially a handshake deal.

We went to the Notario with the sellers, and they had their title and legal description.

About the same time I applied for my FM3. Since I was buying an existing home, an electric bill in the seller's name was sufficient proof of an address to apply for my fidei.

On the same day we went to the Notario, we visited the bank officer at the bank that would hold our trust and had her start her paperwork. They wanted credit card info to charge us for the initial bank fees and the fees due to Mexico City.

It's the responsibility of the Notario to produce the fideicomiso document, and they were good at letting us know what they needed. Perhaps you should ask several notarios for a checklist, and get their prices. All notarios are different; shop around.

In theory a real estate agent could help. Especially if they brokered the sale. In practice, a real estate agent can be a help or can be a potential headache.

We signed the final documents at the Notario's office with the sellers and paid the balance, by check, at the bank immediately afterward. There was no option for an escrow.

FIDEICOMISO PROCESS/EJIDO LAND

Marla Daily - 5-17-2008 at 08:29 PM

Hi and Welcome to this Forum,

You say your seller "received the rights to the [ejido] property during parcelization of the area in the mid ninties."

1. Does he have a Certificado Parcelario and is that what you are buying?
If so, the land is not eligible for a Fideicomiso. Only land with "Titulo" qualifies.
Does the back have a stamped Federal survey? It must.
[Which ejido? In Loreto, for example, ejido land was not parcelized until 1999. Here Certificado Parcelarios have been issued, but very few titles have come through. I am not aware of any ejidos that created legal parcels in the mid 1990s. It is my understanding the constitution of Mexico law was changed in 1998 or 1999 to allow the ejidos to divide.]

2. A hectare of land is 10,000 square meters. It is my understanding that a Fideicomiso will only cover 2000 square meters of land. I believe your parcel is too big for a Mexican Trust. ASK THE BANK. Get it in writing!

3. Ask various banks for a list of their Fideicomiso fees in advance and IN WRITING. Meet with their trust officer. Look to see if you will pay a fixed annual fee on 50 years, if it has a built-in inflation factor, if it is tied to an appraisal of your property every two years, etc. There are MANY different deals out there. The devil is in the detail.

You have a lot of homework to do yet. Keep us informed of what you learn.

Marla

oxxo - 5-17-2008 at 09:08 PM

Quote:

Originally posted by highsierrabum
in response to the ejido land "big red flag"
my situation is not typical "ejido land", it is owned under one name, not the entire ejido, it is private property, and several sales have been concluded with ease already including one fideicomiso and a few corporations. so the usual nightmare of ejido land stuff does not apply here.

Red Flag, Red Flag, Red Flag!!!!!!

Run in the opposite direction as fast as you can!

elizabeth - 5-17-2008 at 09:30 PM

Quote:

Originally posted by Marla Daily

2. A hectare of land is 10,000 square meters. It is my understanding that a Fideicomiso will only cover 2000 square meters of land. I believe your parcel is too big for a Mexican Trust. ASK THE BANK. Get it in writing!

Marla

Generally speaking, foreigners cannot own property greater than 2000 square meters, however, under the Constitutional Article 27, you can. There is a document that you need to execute agreeing to a certain amount of development within a certain period...another reason why you need this handled by a notario.

PARCELS LARGER THAN 2000 SQUARE METERS

Marla Daily - 5-18-2008 at 07:13 AM

It is my understanding development has to occur under a Mexican Coprporation, which does not have the size restrictions of a Fideicomiso. I am unaware of exceptions to the size restriction of Fideicomisos.

In San Juanico where larger ejido parcels are being sold, we were told that people are getting a Fideicomiso for the first 2000 square meters of land (where their house is), and forming corporations for the "protection of open space" for the remainder. The person who started this thread does not sound like a developer.

Anyone with first hand experience?

elizabeth - 5-18-2008 at 07:54 AM

Quote:

Originally posted by Marla Daily
It is my understanding development has to occur under a Mexican Coprporation, which does not have the size restrictions of a Fideicomiso. I am unaware of exceptions to the size restriction of Fideicomisos.

In San Juanico where larger ejido parcels are being sold, we were told that people are getting a Fideicomiso for the first 2000 square meters of land (where their house is), and forming corporations for the "protection of open space" for the remainder. The person who started this thread does not sound like a developer.

Anyone with first hand experience?

Yes, me. The property which is the subject of a forthcoming fideicomiso is a little over 3,000 square meters. The bank has required that I execute a document stating that I will invest a specific amount of money in development within a specific period of time.

[Edited on 5-18-2008 by elizabeth]

[Edited on 5-18-2008 by elizabeth]

Osprey - 5-18-2008 at 02:26 PM

Gibson, the ladies, and others have things to tell us we are most interested in and we encourage them to share. Surely you can spend a little more time in dedicated self-groping until another subject you like appears.

Gadget - 5-18-2008 at 02:39 PM

Quote:

Originally posted by elizabeth

Quote:

From what we learned last year in Todos Santos:

Parcels need to be under 2000 sq mtrs, 1,999 or less, so you avoid some of these issues...

such as the improvement clause. We were informed by several, agent, broker, notary that this clause which everyone seems to be quite fearful of has never been enforced.

If the parcel is over 2000 sq mtrs, it can be divided in two by a surveyor and two Fideicomisos can be made, one for each. This is vertually how all the lots we looked at either north or south of TS were surveyed out. This doubles some of the closing costs, but not all of them and keeps you from dealing with the improvement clause.

FIDEICOMISO INFORMATION

Marla Daily - 5-18-2008 at 03:10 PM

The thread was established by someone with Fideicomiso questions. We are sharing some things to look for which seem relevant to the original poster.

Example: In 1990 we enountered a situation where Bancomer "required" a minimum six-figure investment ($100,000) on a small undeveloped beach lot we purchased. The bank's required additional investment was many times what we paid for the lot! Their annual fee on the Fideicomiso was based on a percentage of the value of the lot and not on a flat annual rate. It was a way for the bank to attempt to establish a minimum annual fee of $1000. Needless to say, we did not get a Fideicomiso with Bancomer on that property.

In fact, Bancomer announced, out of the blue that year, that ALL Fideicomiso annual fees were going up to a minimum of $1000 a year to "meet their costs in maintininig the trust." More than 45 gringos who used Bancomer for their Fideicomisos at the time, united and went on strike, as it were. Bancomer flew attorneys to Loreto from Mexico City—a meeting was held and it was immediately announced there "had been a mistake." They meant to say the new annual minimum fee would be $500!

Now our Fideicomiso is expiring after 30 years and one name transfer. (In 1978 it was the second one established in Loreto). The annual fees are $330, up from the original $70/year. Last week we went to Bancomer to process a 50-year extension, only to be told our Fideicomiso had never been registered in Mexico City. THAT could be the topic of a whole new thread!

My point—read the small print of any Fideicomiso and be sure you know what annual fees you will be facing for the next 50 years. Also know that if you buy or sell, the person to whom you sell is tied to the contract you sign for the term of the trust. The clock does NOT start all over when you sell (or buy).

highsierrabum - 5-18-2008 at 03:22 PM

Now this is something new....you folks are saying that a hectare is too big for a fideicomiso, for some reason I am skeptical of this....I have not heard this before at all, but I do know that if your land is over 2,000 sq. meters then you have the development clause. I have two friends in the same place that did a fideicomiso and there land was just over 2,000 sq. meters but less than a hectare....they signed the development clause and have built a house with plans for a garage....probably enough to satisfy the development clause....It is my personal belief that you can get a fideicomiso for one hectare, but that you will have to sign the development clause--which I'm not too concerned about....for one the property is far from the highway, and thus far from the eyes of the law, and I will be building a structure right away not just plopping a trailer onto the dirt, so it would be relatively easy to claim that I've "developed" the property after a couple years with a small house on it and more plans in the works....

Sounds like my first trip will be straight to the notario, which is pretty much what I figured, and that from there they can guide me through the process. My friends who did a fideicomiso from the same seller mentioned that I need a map of my property before I can do anything. So if this is true I suppose I need to prod the ranchers who are selling to get the map done before I go back down to start with all this paperwork, since the map will probably take time. Anyone with experience in this?

As far as the red flag stuff....you guys are worry worts man, relax.....and perhaps I'm wrong about the mid nineties time frame, that's what I thought someone told me, but if it didn't happen until 99 then ok, whatever. The seller is honest, trustworthy, and has title to the land. He's lived there for his whole life, and his entire family still live there on part of the land. there are no worries about his right to sell the property....I am far from being the first to buy there....several "corporations" and one fideicomiso have gone through and are complete with no troubles, and recently a development company (the enemy/devil incarnate) has agreed to buy 200 hectares...you can find it at bclandaquisitions.com.....it makes me sick and I hope it doesn't happen but it's just another piece of evidence that the seller has his ducks in a row.....

alright....as far as the FM3, I can't get it first because I have nothing to prove that I'm living down there...there are no utilities and never will be where I'm buying (which is why I am buying there), and so it seems to me that I must first get title and fidei for the land and then use that to prove that I am a resident in need of an FM3....

Thanks for the info folks...(you might be wondering what happened to the ballena.....sorry but I drank it already....got thirsty in this heat...)

cheers
dave,
any further information will be appreciated if someone's got recent experience with the process....

DianaT - 5-18-2008 at 03:30 PM

Dave,

Don't know where you are, but we hired an agent in La Paz who handled our fideocamiso from start to finish, and he was NOT expensive. We even gave him a power of attorney so we did not have to travel to La Paz.

He answered all our questions, and the process for us took about four months. He is also familar with ejido land.

There are others in Bahia Asuncion who have and are using this agent. If interested, U2U. He is also handling our FM3.

We found it a lot easier this way and we did it just this year.

Diane

highsierrabum - 5-18-2008 at 04:07 PM

i am buying in baja norte, out in the seven sisters...so perhaps i would want a different agent, but thanks for the information. I have also been told this before, and thought that I may end up going that route if I could not figure things out myself. I guess the main thing I need to figure out is what documents I need from the seller in order to begin the paperwork. That way I can notify them in advance of my next trip to baja and perhaps even meet them in Ensenada on my way down....

thanks for all the info folks and keep it comin' if you got something new to share...

--dave

oladulce - 5-18-2008 at 04:32 PM

Hi sierra-

1. You need to start with a Notario Publico, not the bank. The Notario is responsible for executing the propery title transfer, the official recording of the new title, and payment of taxes associated with the sale. Nothing will happen without a Notario.

The Notario is the conductor of the transfer and will tell you what documents you will need. You don't have to be in Mexico to get the ball rolling (or to complete most of the fide steps, for that matter).

How's your spanish? How about your legalese spanish? If yours is shakey, it's very helpful to find a Notario (or his secretary) who can speak some english. Also important is to ask around for a Notario who either utilizes email or is available by phone when you call: very important if you'll be doing alot of the steps from the US.

2. There are a few steps you can start on before you actually have the title, but the fideicomiso process won't progress very far until you have paid for the property and the seller is ready to sign it over to you.

Stuff you can gather before the actual title transfer:

From your local municipio office:
1. Certificate of No liens/no taxes owed (means seller has paid up his property taxes etc).
2. Most recent property tax receipt from seller.
3. Yor need a doc from the Obras Publicas (public works) dept that describes if you have water and power to the lot.
4. You don't need a map, but you do need an "Avaluo Percial" which is a property appraisal by the local catastro office. This doc will have a schematic (map?) of the propery on it. Be aware- these Avaluos are only good for 3 months so don't do it too early in the process.

There are Documents specific to your purchase of privatized ejido property. Becasue this is the first title transfer since the seller received his parcel, you will need:

1. A copy of his "Titulo de Propiedad" (title).
This doc will have a stamp and signature of the "Delegado Del Regristro Agrario Nacional" and confirms that the proper steps were followed and the title is registered with the local Agrarian office. This means that the seller now has the rights to this former ejido property. I would also ask for a copy of the seller's "Derecho de Tanto" for your own records.

2. Sounds like the property may be classfied as "rustico" (outside of town, etc) and because this will be the first title transfer of his parcel since he got title, you will need to have something called an "Avalou Bancaria" . This (besides being $$$ and a pain in the butt) is another type of property apprasial which can only be done by special banks (ours was "BANOBRAS" ).

The bank will send out a guy who does a detailed survey of the property, takes photos, and compiles a detailed 20 page report with stuff like the average railnfall, number of cows the property could support, types of plants, potential commercial value blah blah. This document took about 8-9 months for us to finally get so It's the first thing I would work on. It will be in the seller's name so you can get it before the sale is done.

I don't know what they do with it but it's a federal requirement that the state branch completes and it'll have some very important looking stamps on it.

Ours took so dang long to finish that our local property appraisal "avalou" (above) kept expiring and we had to get 3-4 renewals of that one= more$$$.

Start researching what bank you want your Fide with so you can tell the Notario. The Notario will contact the bank for you.

You can get a fideicomiso on any size property - lots of misinformation on that one because of a law that changed a few years ago. It used to be that any foreigner who bought property in the restricted zone would have an "investment clause" as a part of his fide. This has nothing to do with the bank.

The bank/notario submits all your property purchase details to the Mexico City office of the Minister of Foreign Relations who will give their approval of the sale. They have to approve before a fide can be done for you . A part of this "foreign relations permit" it's sometimes called, is an "investment clause". Foreign Relations will give a dollar amount that you're supposed to invest in your property starting within 24 months of the fide date. You'll pass out when you see the ridiculous amount they put on your permit. I won't go in to the enforcement (or lack of ) this investment requirment cuz that's a whole nother issue.

All foreigner-purchased property used to require an investment clause in the fide . Now only property over 2000sq. meters has to have the clause. Yes you can get a fide, and yes it will have and investment "requirement" because of the size of your lot.

You are allowed to purchase property and transfer title (in BCS at least) with an FMT tourist permit. Done it quite a few times. This is not the case in all Mexican states. I won't get in to the fm3 debate because your head is probably spinning already.

It's frustrating trying to gather all the necessry info isn't it? Hope this helps to get you started.

Pescador - 5-18-2008 at 05:47 PM

Oladulce has the information down pat, but I still disagree on the size of a fideo and was told personally by the Notario in Santa Rosalia that the 1,999 sq meters did apply and that if you went over that you had two options, you could form a corporation and do development (this one is stickier than in the past) or they would do the fideo for the 1,999 and you could hope no-one ever questioned the size of the property and followed the fence lines.
If the seller does not have "escritura" then you have a major problem with privitizing ejido land and it may never happen, no matter what you have been told. If you do not have a certificate from the Department of Agraria in La Paz or Mexico city, then you will have to go through all this when you try to get a fideo. This is the biggest nightmare you can imagine. I have a property that had been privitized but the certificate was not in effect and we had to go through that process anyway. I would suggest that you google search "buying ejido land" to educate yourself in ejido privitization. The good people of Punta Banda should have done the same thing.

oladulce - 5-18-2008 at 06:00 PM

I see you've mentioned your remote location so I'll suggest that you hire somebody to help you get your fide. You can collect many of the necessary docs yourself but it will be very time consuming!

As a fellow fringe-dweller, I can tell you that the onsite inspections that have to be done by govt officals will take forever to accomplish when they have to drive long distances to get to your property. It will help to have somebody either calling to prod them (in Spanish) or dropping by their office frequently to get them to come out.

Also factor in to your budget, the cost of "incentives" you'll probably need to pay to get these guys to come out and do their job because of your location. These aren't mandatory but often paying a little to motivate a guy to visit your property can save you money in the long run by preventing the process from dragging on and on.

DENNIS - 5-18-2008 at 06:50 PM

Hasen't anybody won that Ballena yet?

oladulce - 5-18-2008 at 11:34 PM

Scary how different the info can be, isn't it Pescador.

We have 2 adjoining lots and each is 5000sq meters and both have a fideicomiso (with different banks).

We're going to combine the lots back to the original 10,000 sq meter, single property and the bank rep and La Paz notario said no problem combining the 2 in to one fide .The size of the property was never questioned during any of the applications.

Our oceanfront lot has a different investment requirement than the lot behind it (a difference of $100,000 dollars) for the same size piece of dirt with the same rocks and stickers, all out in the boonies without water, power etc . I have no idea how the Sec. of Foreign Relations office determines one's investment requirement from over in Mexico City. Do they even look at a map or just pull numbers out of a hat?

Pescador - 5-19-2008 at 03:34 PM

Had an acquaintence who got a fideo from Guille Santillan in Santa Rosalia and the size was over the 1999 sq. meters and they just chopped it down to that size and figured that fence was moved by agreement and that it would all work out in the long run.
So you are saying they allowed you more than that size as long as you developed the area with a minimum investment of development. Guess that is another way to build up the economy in outlying areas. It probably also means that with enough connections you can change the law to pretty much whatever you want to. :?:

comitan - 5-19-2008 at 03:41 PM

In Comitan we have several properties that people bought 1500M lots back to back, the second lot was fused is the terminology that was used.

highsierrabum - 5-19-2008 at 04:02 PM

congratulations to Oladulce
you win a virtual
ICE COLD
32 OUNCE
Pacifico Ballena
| |
/ \
| |
| |
|__ |

that's some great info and I am copying it down and will use it to further my investigations....One thing I'm a bit confused about is that I've been told to never, under any circumstances, pay the total amount for the property until all the paperwork is finished, literally holding the fidei in your hand....so to me it seems that the sellers ought to be fine with me verbally telling them that I'm ready to pay the total and that they will receive the total when the paperwork is finished.

Another thing. You mention that this is the first transfer of title for the seller, but there have been several other sales with completed paperwork, including two corporations and one fideicomiso....so perhaps much of this difficult paperwork has already been completed and the seller has it ready. Also, I have heard before about this Derecho de Tanto....and there is already a copy ready...a big sale was just completed and the entire family went to Ensenada to sign for it....so this leads me to believe that some of the time consuming paperwork stuff has already been done.

The terreno is "rustico" --that is how it is described on the official receipt...It is at puerto San Andres (aka "Alejandros") just several miles north of the nicest paved road in all Baja.....the new strip into Santa Rosaliita for the sand filled marina.....so it shouldn't be too hard to get some stuff done there I guess.....

but yes, my head is spinning....
Thank You so much oladulce for concise, straightforward info.....and really, some time in the future, if we're there, up on our hill behind Alejandros, there'll be a cold one waitin' for ya....

----cheers
-dave

thanks oladulce

highsierrabum - 5-19-2008 at 04:16 PM

i tried to edit my ballena image but boy did that not work...
here's another attempt

congratulations to Oladulce
you win a virtual
ICE COLD
32 OUNCE
Pacifico Ballena
.....|.|
..../...\
...|.....|
...|.....|
...|___|

REQUIRED INVESTMENT ON LARGE PROPERTIES

Marla Daily - 5-19-2008 at 05:10 PM

Today I received from a Mexican laywer in Loreto the Federal Regulations for Investment on Properties larger than 2000 meters square. "Relacion tabulador de monto de carta compromiso" states that within TWO YEARS the following applies on properties larger than 2000 square meters for a Fideicomiso:

Land Size/Square Meters Amount to be Spent on Development in Two Years
2001-3000 $250,000 USD
3001-4000 $300,000 USD
4001-5000 $350,000 USD
5001-6000 $400,000 USD
6001-7000 $450,000 USD
7001-8000 $500,000 USD
8001-9000 $550,000 USD
9001-10,000 $600,000 USD
10,001-11,000 $650,000 USD
11,001-12,000 $700,000 USD

The table is progressive and continues using the same formula.
Since I introduced the concept of land more than 2000 sq. meters,
I felt responsible for providing the facts—

(And I don't like beer anyway—sorry).

oladulce - 5-19-2008 at 11:15 PM

Quote:

quote]Originally posted by highsierrabum

Another thing. You mention that this is the first transfer of title for the seller, but there have been several other sales with completed paperwork, including two corporations and one fideicomiso....so perhaps much of this difficult paperwork has already been completed and the seller has it ready.

Sorry, I don't think I explained this very well. Are you the first one to buy YOUR lot from the Ejido member since he received his title for this "privatized ejido land? It sounds like he may have subdivided his parcel in to a few lots and you will be buying one of them (?)

The Avalou Bancaria is a Federal govt valuation appraisal for land that will undergo a "change of use". For example, ours had been zoned "Agropecuraria" (agricultural) when it was ejido property and once the parcels were privatized the govt. re-zoned our area as “residential tourist”. Maybe your seller did this appraisal when he got his title, but chances are you, the gringo, will be footing the bill for this as usual. I don’t understand it completely and maybe somebody else knows more about it, but this appraisal was required for our fideicomiso. It was not required for our front lot purchase (2004), but it was on the back portion (2006) so it’s fairly new and your notario will let you know.

Thanks Marla for the investment requirement table. So there is an official formula they use to decide how much you're supposed to spend.

Interesting because both of our lots are the exact same 5000 sq meter size, but one fide has a $450,000 investment requirement and the other is $350,000 so the Foreign Relations Secretary must have read their own table incorrectly. :rolleyes:

INVESTMENT REQUIREMENT/PROFEPA

Marla Daily - 5-20-2008 at 06:32 AM

HOLA OLA DULCE et al,

I would go and ask the bank why the amount of investment required on the front lot has an extra $100,000 tacked on to it! Perhaps the bank did that. Is the annual fee you pay on each fideicomiso the same amount? Is it tied to the value of the property or is it a set annual fee with a built in inflation clause.

Another tidbit we were told by the attorney yesterday is that there is no such thing as a corporation whose purpose is to preserve land, native species or the environment. We discussed how lamentable it is that on one hand development is required (land clearing to build), and on the other, PROFEPA (at least in Loreto) runs around fining people for doing just that! PROFEPA inspection fees and permit are exorbitant, and the multa over the top for any clearing without a permit (as in $10,000 USD!)

We have 15,800 square meters of beachfront land—pristine desert with fabulous elephant trees, jojoba, etc.—we would like to preserve FROM development, yet it appears we are legally unable to do so. Instead, the law "requires" $900,000 USD in construction on the land! Go figure!

Bob and jane - 5-20-2008 at 07:14 AM

highsierrabum:
We camped at Alejandro's for several days on our way to Loreto two years ago. A guy named David found us wandering around Sta. Rosalallita and led us to the camp. We had a great casita with concrete steps leading to the beach. Sandra and George were camped next to us. Have they finished their house on the hill? They were laying the block walls themselves. They gave us a tour and we shared a number of beers. Say hi to them from Bob and Marilyn if they are still there. We had a great time. It was hard to leave. Always think we'll get back there.

elizabeth - 5-20-2008 at 08:43 AM

Marla, thanks for the table. It is consistent with what I'm being told.

Oladulce, you definitely laid out the steps to privatization and fideicomiso well and in understandable terms...

the best advice I think everyone is giving is that the most important part is first finding a notario to work with.

oladulce - 5-20-2008 at 10:18 AM

Quote:

Originally posted by Marla Daily

... We discussed how lamentable it is that on one hand development is required (land clearing to build), and on the other, PROFEPA (at least in Loreto) runs around fining people for doing just that!

We have 15,800 square meters of beachfront land—pristine desert with fabulous elephant trees, jojoba, etc.—we would like to preserve FROM development, yet it appears we are legally unable to do so. Instead, the law "requires" $900,000 USD in construction on the land! Go figure!

Oh Marla, I could use one of those smiley faced things who's rolling her eyes and shaking her head.

I haven't sat back and looked at the whole silly picture before and you're absolutely right! For SEMARNAT/PROFEPA we tried to make it look like we had a very small footprint of building on our lot and went around propping up little cholla the tractor had knocked over during construction to minimize the "damage" we'd inflicted on our environment.

But If we ever have to defend the amount of investment we've made to the Secretario de Relaciones Exteriores, we'll have to make the casita appear like a very grandiose hacienda with all the receipts (got a file for those already) and very expensive unseen building costs like material transportation (oh wait, at $600 per dump truck of gravel, that part is true!).

I was going to mention all this in the current "Top ten scams in Baja?" thread, but Oldlady summed it up nicely on that thread with her comment "anything having to do with building a home" is a scam.

Gadget - 5-20-2008 at 12:52 PM

Lots of good info. A Notary we talked to told us to always log outside info in the maybe file, until you actually sit down across the desk from someone. Then you better be very certain the info you get from them is acurate before you sign anything.

This board is a great start to doing "do diligence", but I would always consider it just the footing trenches to the foundation of any info.

And that table you posted Marla, yikes!
So much for building a nice little hideaway somewhere on a 2000+ meter lot.
That alone, if I ever do purchase a lot, will keep us under 2000 sqmtr or split larger into 2 lots.

Oh, that was another thing, property line set backs. If you do combine 2 lots or split a bigger one you can't center any structure over the dividing property line.
Always something, huh?

Corporation?

bajabeachbabe - 5-20-2008 at 01:53 PM

The other side of the Fideicomiso coin is to create a corporation. When we purchased our property we were advised by the real estate agency that a corporation was a better alternative due to the size of our lot(s) and specifically the investment requirement. The inital cost of creating the corporation was possibly greater than a Fideicomiso, but it gives us much more flexibiliity. With a corporation you need to have a business purpose, but our plans always included at least a couple rental cabanas on our lot. We will have monthly accountant fees for reporting, but we won't have trust fees to pay to the bank. I think for us, the corporation will be a better choice, especially considering each of our two lots are about 10,000 sq meters.

Marla, (Hi neighbor, Linda here) that is one scary "required investment" schedule you posted! At least with the corporation we can invest what we want, when we want. Plus, we have the option of having a business doing just about anything other than running a fishing boat.

oladulce - 5-20-2008 at 04:34 PM

Quote:

Originally posted by highsierrabum

....One thing I'm a bit confused about is that I've been told to never, under any circumstances, pay the total amount for the property until all the paperwork is finished, literally holding the fidei in your hand....

highsierrabum-

When your fide is complete, the Notario will have the seller come to his office to sign and at this point he'll be relinguishing his rights to the property. This is when we have always made the final payment to the seller. Sometimes we've been at the notario's office to sign at the same time as the seller, and other times we've given a power of attorney for our signatures ahead of time.

When we haven't been able to get down there for the final signing, the final payment was wired to the Notario so the seller could leave the office with his money.

But even if you make your final payment at the fide signing, you won't walk out of the office with the final doc in your hands because the Notario has a few more very important steps to do with it.

The Notario will deliver to the catastro office the "Transfer tax" you'll be paying him and he'll take the fideicomiso doc to the Ministro Publico (public records) office so the deed can be registered in your(and the bank's) names. You'll get the most important stamps on your fide in these steps and he needs to bring the original copy with him to do so.

It's taken anywhere from 2 weeks to 2 months after we made the final payment for us to have our original fide copy in our hands on various purchases. You can have the seller write a receipt when you give him the final payment so you leave the office with someting after handing over your life's savings.

And muchas gracias, I love cerveza.

highsierrabum - 5-20-2008 at 06:03 PM

in reply to a couple things

bob and jane:
yes george and sandra are there with a great little house. george just finished the livingroom tile this spring, and has little rocks up all over the outside to help it blend in, as well as a rad beach/arroyo stone patio. They've even got an indoor shower and toilet believe it or not, it's a real house now. we had a good winter hanging out with those two....saw the David you mention...he used to be sort of Camp Counselor of Alejandros but had a recent relationship with a woman who guides sea kayaking near Loreto and was busy doing that before they even more recently split up and now who know's where he is......

the palapa with the steps down to the beach is a design idea / feeling that I want to mimic up on our hill about a kilometer back in the first range of hills....and open place with just one small enclosure.

and in response to everything else....I just began emailing a lawyer contact in Ensenada that the seller had given me originally to help me get my FM3 but she as well as others here told me that I do not need my FM3 for a fideicomiso, and she does fideicomisos, so perhaps I will be able to go through her, since she is a trusted contact of the seller's family, and has been doing some of the other sales that have occured in the area. once again, we aren't the first to buy here so that initial stuff I believe has all been done already. I think I remember hearing that the ranchers actually lost money on their first sale because they didn't realize themselves all the things they'd have to do to be able to sell property....

anyways, thanks everyone for your info. between what you've written and what I can find out from this contact in Ensenada, I think I'll be set, just trying to get a clear idea in my head of the process, the timeframe, how what when where....and I think it's starting to get clearer.....

thanks again folks
---dave

Gadget - 5-20-2008 at 09:11 PM

Bajabeachbabe, I am pretty sure you can only do something through your corporation that does not take a job away from a Local.
Am I wrong anyone?

And highsierrabum, as per the info my in-laws have gathered who are in BoLA, there is no fideicomiso process in BCN. As the Diaz family start to sell of their land everyone is having to form corporations to buy.
Or am I wrong again and it is just in BoLA?

bajabeachbabe - 5-21-2008 at 01:14 PM

Quote:

Originally posted by Gadget
Bajabeachbabe, I am pretty sure you can only do something through your corporation that does not take a job away from a Local.
Am I wrong anyone?

The corporation language as ours is written, is very broad in what it allows you to do as a business. Maritime activities are not permitted as they would be taking away a job from a local. So, you are correct in your understanding that certain jobs are protected.

bajalou - 5-21-2008 at 03:25 PM

Quote:

Originally posted by Gadget

And highsierrabum, as per the info my in-laws have gathered who are in BoLA, there is no fideicomiso process in BCN. As the Diaz family start to sell of their land everyone is having to form corporations to buy.
Or am I wrong again and it is just in BoLA?

People in San Felipe buy using the fideicomiso process for homes. The laws prohibit living on property that your corporation owns in almost all cases..

Pescador - 5-22-2008 at 09:10 AM

Quote:

Originally posted by bajabeachbabe
The other side of the Fideicomiso coin is to create a corporation. When we purchased our property we were advised by the real estate agency that a corporation was a better alternative due to the size of our lot(s) and specifically the investment requirement. The inital cost of creating the corporation was possibly greater than a Fideicomiso, but it gives us much more flexibiliity. With a corporation you need to have a business purpose, but our plans always included at least a couple rental cabanas on our lot. We will have monthly accountant fees for reporting, but we won't have trust fees to pay to the bank. I think for us, the corporation will be a better choice, especially considering each of our two lots are about 10,000 sq meters.

Marla, (Hi neighbor, Linda here) that is one scary "required investment" schedule you posted! At least with the corporation we can invest what we want, when we want. Plus, we have the option of having a business doing just about anything other than running a fishing boat.

That is only part of the picture. I have a friend who is doing a property development and he is up for renewal on his FM2 and now he is getting a lot of heat from the immigration office for showing an employee and they are disallowing contracted or pay for fee types of employment.
The second part is that when you close down the corporation it is significantly more expensive to do that than it was to open it up in the first place. Failing to properly close down the corporation allows the gov. to take title to the property for fees and owed moneys.
So what looks good at the outset may not be the best overall solution.