Fideicomiso

To own property in the restricted area which includes Merida and some areas of the Yucatan, you engage a Mexican bank to execute and hold title to the property using a contract known as a fideicomiso. With this, you and the bank are both listed on the title papers.

The fideicomiso creates a trust contract for the benefit of the foreign buyer. The bank has a fiduciary obligation to the owner. The owner has all the benefits of ownership and retains the legal right to lease, sell, and/or will the property to his heirs. Fideicomisos are currently 50 years documents. They can be renewed at the end of the term for an additional 50 years. There is no limit to the number of times the fideicomiso can be renewed. The renewal fee is currently about $900 USD.

The cost for initiating a fideicomiso is approximately $2,800 USD. There is an annual fee to the bank for maintaining the contract. The annual fee is based upon a percentage of the value of the home. An estimated figure for a home in the $100,000 range is about $600 USD a year. Current law does not allow a fideicomiso for properties larger than 2,000 square meters (approx. 21,520 square ft.)