Escrow is a legal concept that is used to provide security and assurance to parties involved in a transaction. In Mexico, the use of escrow is becoming increasingly common in real estate transactions, as it helps to protect both buyers and sellers. International Surf Properties has a relationship with Secure Title Mexico.
When a property is put up for sale in Mexico, the seller will typically provide the buyer with a “promise to sell” contract, which outlines the terms of the sale. The buyer will then deposit a certain percentage of the purchase price, usually around 10%, into an escrow account. This deposit serves as a guarantee that the buyer is serious about purchasing the property, and that the seller can trust that the buyer will follow through with the transaction.
Once the deposit is made, the seller is required to provide the buyer with a number of documents, including a copy of the property’s title, a property appraisal, and a certificate of no liens. The buyer then has a set period of time, usually around 30 days, to review these documents and ensure that everything is in order. If the buyer is satisfied with the documents, they will then make the remaining payment, at which point the seller will transfer the property’s title to the buyer.
However, if the buyer finds any issues with the documents or is not satisfied with the property, they have the right to cancel the contract and have their deposit returned to them. This is where the escrow account comes in: it acts as a neutral third party, holding onto the deposit and ensuring that it is returned to the buyer if the transaction is not completed.
Escrow Services in Mexico
It’s worth noting that using an escrow service in Mexico can be an attractive option, especially when buying property from a foreign seller. Unfortunately there are not a lot of options in Mexico, but Secure Title has come through on all of our dealings. As the escrow account is held by a neutral third party and not either of the parties involved in the transaction, it can help mitigate risks of fraud or miscommunication that may arise when buying a property in another country.
In conclusion, using an escrow service in Mexico can provide added security and protection for both buyers and sellers in a real estate transaction. It allows for a neutral third party to hold and oversee the deposit, ensuring that the transaction is completed fairly and with minimal risk. As escrow becomes more common in Mexico, it’s likely that it will become an increasingly popular option for both foreign and domestic buyers and sellers.