Acapulco 1 | Acapulco Real Estate, Villas & Vacation Rentals
If you have been employed for 3 years, have a credit score of 650 or better and are between 25 and 65, you can now get financing for your dream home in Acapulco. Acapulco 1 Real Estate can now help get you mortgage financing in Acapulco and many other Mexican cities.
Loans in U.S. dollars
Financing for up to 75% of the value of the property.
Terms for up to 30 years @ 8.75% fixed for 15 years with NO pre-payment penalties.
Minimum property value: $100,000 USD
Minimum loan: $50,000 USD
Maximum loan: $600,000 USD
Simple application process.
Minimum age of 25 years, maximum age of 64 years, 11 months.
Minimum demonstrable income of $3,500 USD per month or $42,000 annually.
Minimum 3 year employment history, with 6 months at current place of employment.
If self-employed or business owner, minimum of three years in same activity.
Home and business telephone.
FICO score of 650 of greater.
Valid ID (Driver's Licence and/or Passport)
Proof of Income (Employees: last month pay-stubs and 2 years tax returns; Self-employed, 6 months bank statements and tax returns for two years)
Proof of address (recent light, phone, gas, or water bill)
Copy of marriage certificate (if applicable)
Copy of ID of trust beneficiaries
*Life insurance and damage insurance required and will be included in mortgage payment. Title insurance optional.
*Escrow by First America or Stewart Title
* Trust (Fideicomiso) required for all loans and held by Deutschebank.
Mortgage Closing Costs in Mexico
The first thing you should know as a foreign real estate buyer about closing costs in Mexico is that closing costs are relatively high, even for Mexican citizens. This is especially true for those financing their properties. But don't let that scare you. Taking a step back, a few extra percentage points really have little weight when one considers that in Mexico, you can get three times the home for half the price and sun all year around.
For cash transactions, closing costs include a trustee fee, insurance, a tax appraisal fee, an accusation tax as well as a number of smaller fees. For those financing, add to these costs a title search, title insurance, escrow fees, various loan fees, and a U.S. market appraisal.
Prospective buyers, whether financing a property or paying cash, should always remember to take into account the closing costs as well as the purchase price and down payment. Typically, you will need 20% or 30% in down payment down plus the closing costs. If you want to buy a $100,000 property, you’d likely need a minimum of $30,000. Interest rates have really come down on mortages in Mexico however and they are now comprable to U.S. mortage rates.
If you’re paying cash, there are several stops (and fees) you’ll need to contend with.
(1) Registro Nacional de Inversiones Extranjeras (RNIE) is essentially the registration of the deed (escritura pública) through the Commerce Department or more specifically, the Ministry of Foreign Investment. Your trustee (a Mexican bank) is responsible for completing this step within 30 days after the title transfer has been approved.
(2) Assorted Notario fees. A mexican notario is a highly esteemed, and usually wealthy, public records keeper. Notarios are the guards at the gate as well as the lords of the manor when it comes to real estate transactions in Mexico and they do most of the serious work which includes:
(a) Securing the Permiso de la Secretaria de Relaciones Exteriores (SRE) which is your permit from the Ministry of Foreign Investment to undertake the transfer.
(b) Collecting and paying (without adding a surcharge) the Impuestos Sobre Transmision Patrimonnial (ISAI) which is a state tax which runs between 2% and 3% of the sale price of your property.
(c) Processing the Registro Publico de la Propiedad (RPP) which is a local permit required for the transfer.
(d) Issuing the Certificado de Libertad o Gravamen which is a certificate that states that the property is free of liens. This certificate is good for 30 days. If the real estate transaction is not completed within this time frame, a new certificate must be issued (and a new fee charged).
(e) Also a Avaluo y Deslinde takes place. This is an appraisal of the property for tax purposes. This has nothing to do with the appraisals for loan purposes. The government may decide to perform a pop appraisal of the property after purchase. If the appraisal value is greater than 10% of the price you paid for it, you will be responsible to pay a 20% tax on the difference between the two amounts. This sum is due within 15 days of the date of the appraisal report. This is very rare, but it’s a good idea not to let the seller try to fudge things to save on taxes.
Though notario fees vary from notario to notario, they cannot charge more than the max fees as outlined by state law.
(3) If you plan to live in the restricted zone, a Fedeicomiso en Garantia must be set up. A fideicomiso is nothing more than a legal trust held by a trusted financial intermediary, typically a bank, that confers upon its beneficiary every single right that any Mexican owner has when they own a property (including improving, selling, renting, passing on in a will, etc.) except actually holding the title in their name. This is a one time fee. It also carries an annual fee that must be paid in advance, so the first installment is due at the time the trust is set up.
Note: The “Restricted Zone” is a strip of territory one hundred kilometers wide along the borders and fifty kilometers wide along the coast.
If you don’t live in the Restricted Zone, a fedeicomiso is not necessary. You can title the property directly in your own name. The one advantage of a fedeicomiso, however, concerns inheritance of the property in the event of the death of the owner. A fedeicomiso requires a named beneficiary and so there is no question about who will become the lawful owner.
(4) Escrow Fees – an escrow account is typically set up with instructions on how funds are to be disbursed. A title company is required to set up an escrow account as agents are normally not permitted to maintain escrow accounts for their clients. Stewart or First American Title are the two most widely used. Closing costs as well as the purchase ammount are both placed into escrow. Escrow is not necessary, but it is essential if you want to be sure you moey is safe. Escrow fees are paid by the buyer.
If you are planning to finance, several more items will likely be necessary:
(5) Title insurance is generally required.
(6) A title search by a title company. This fee will depend on the title company.
(7) A U.S. market appraisal will be required.
(8) Loan origination fees are paid to the lender.
Closing costs generally run between 7% and 10% of the purchase price and it is customary that the buyer must pay for everything except agent fees which are paid by the seller.