Common Fears about Mexican Real Estate Fideicomiso

Common Fears about Mexican Real Estate Fideicomiso

If you are hoping to purchase Mexican real estate, it is important to know what a “Fideicomiso” is and how it affects your purchase and ownership of land in certain areas in Mexico.

Fideicomiso and Its Meaning

A fideicomiso is a land trust that you need when you purchase a property located within 31 miles (50 km) of the coastline and 62 miles (100 km) of the borders. You choose which Mexican bank is most suitable to hold your real estate trust on your behalf. The bank you chose will be the Trustee and the beneficiaries of the trust are you and whomsoever you designate.

You gain full control of the trust along with the use of the property and all the decisions related to its investment. In contrast to a lease, a fideicomiso is more similar to a Living Trust in the US. As the beneficiary of the trust, a fideicomiso gives you absolute and unchangeable control over your Mexican real estate. You decide how to enjoy it or whether you like to lease, improve, mortgage, sell, or involve it in an inheritance or a will. Basically, having a fideicomiso for Mexican real estate in the restricted zones means you allow a Mexican bank to administer your property on your behalf, but you are the beneficiary.

Fideicomiso and Its Importance

The reason for the introduction of the fideicomiso when foreigners want to buy Mexican real estate is because the Mexican constitution identifies some land areas in Mexico which foreigners are not allowed to buy. These areas are called the “restricted zone”. The restricted zone for Mexican real estate is any land within 31 miles (50 km) of the coastline and 62 miles (100 km) of the borders. A fideicomiso allows foreigners to buy prime Mexican real estate inside this “restricted zone,” which they would otherwise not be able to do. Outside the restricted zone, foreigners may buy Mexican real estate directly without the need for this bank trust. Some foreign buyers choose to still use this trust for convenience.

FAQ about Mexican real estate Fideicomiso


Is your trust an asset of the bank?

Instead of being an asset of the bank, the bank acts as merely the stewards of the trust. The beneficiaries of the Mexican real estate include you and those whom you designate. The bank holds the trust to your Mexican real estate property but it is not considered an asset of the bank.

For how long is the Fideicomiso trust?

Fifty years is the initial established period when foreigners buy Mexican real estate through a fideicomiso, but you can renew it anytime. You only need to fill out a simple form and pay a nominal fee. The trusts are renewable every 50 years for perpetuity.

How much does a fideicomiso cost?

Currently, it costs about $500 USD per year for foreigners to sustain their fideicomiso for Mexican real estate within the restricted zones.

Will the government have the power to take my property?

There is a fear among foreigners about the possibility of the Mexican government taking over their lands. Under the North American Free Trade Agreement (NAFTA), Mexico may not directly or indirectly expropriate property except those for public purposes (i.e. roads). This can only happen through a legal condemnation proceeding. If there is a rare case where the government needs to take your land, it will pay swiftly and fairly according to market compensation together with accrued interest.

Can I get a fideicomiso for ejido land?

An “ejido” land is land that only a Mexican national can legally own, and they can only do so under strict circumstances. Therefore, fideicomiso is not applicable for an ejido land. An ejido land is the only land in Mexico without a title and is intended for those Mexicans who work on the land.

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