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Attorney Referral for Closing


Zeb
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I'd appreciate some attorney referrals to go over some real estate contracts and verify closing documents.  I do understand the Notarios do this.  I want an attorney to verify the Notario's work.  I already know about Spender, so if anyone has other referrals, I'd appreciate it.

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Of course you can use a lawyer for your own protection. I used Neus, Marie de las Nieves Solbes 331 520 5529. She may even bring her son along. He is also an expert on this. They are both bilingual. 

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Two steps, the first is to have your atty follow the process prior to closing.  The second step is that your attorney attend the closing to verify that there were no changes to the agreement. including your potential capital gains tax liability down the road. 

Also be aware that some notarios and real estate agents are on the "buddy plan" of kickbacks.  So maybe the info your real estate agent is spoon feeding you is tainted.  Not just Mexican real estate brokers, but many American brokers/agents also.  This is Collusion.  Shooting fish in a barrel if you are unfamiliar with Spanish and Mexican real estate law.

Also you have some notarios who just do a sloppy job and you pay the price.  Disregard all notario recommendations on this board.  Some may be better than others but at the end of the day, they all are prone to sloppy mistakes that will cost you down the road.  

Get independent counsel prior to closing.

There only seems to be one at lakeside.  There is a dicho in Mexico about attorneys....When you choose an attorney, take a cat with you.  If the cat jumps on the attorney then he is a rat.  If the cat runs from the attorney, then that is the one you want to hire.

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Unbelievably blanket statement. A broker will not do a closing without a notario, period. To suggest such widespread collusion and laziness... based on what information? I know a lot of agents and brokers and they would never allow themselves to be cut off at the knees by sloppy legal practices.

And your dicho: if the cat runs from the attorney, what does that make him? A bigger rat?

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54 minutes ago, Kiko said:

Two steps, the first is to have your atty follow the process prior to closing.  The second step is that your attorney attend the closing to verify that there were no changes to the agreement. including your potential capital gains tax liability down the road. 

Also be aware that some notarios and real estate agents are on the "buddy plan" of kickbacks.  So maybe the info your real estate agent is spoon feeding you is tainted.  Not just Mexican real estate brokers, but many American brokers/agents also.  This is Collusion.  Shooting fish in a barrel if you are unfamiliar with Spanish and Mexican real estate law.

Also you have some notarios who just do a sloppy job and you pay the price.  Disregard all notario recommendations on this board.  Some may be better than others but at the end of the day, they all are prone to sloppy mistakes that will cost you down the road.  

Get independent counsel prior to closing.

There only seems to be one at lakeside.  There is a dicho in Mexico about attorneys....When you choose an attorney, take a cat with you.  If the cat jumps on the attorney then he is a rat.  If the cat runs from the attorney, then that is the one you want to hire.

Some of the reasons you mention are why we want an attorney.  Thank you for your comments.

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50 minutes ago, ComputerGuy said:

Unbelievably blanket statement. A broker will not do a closing without a notario, period. To suggest such widespread collusion and laziness... based on what information? I know a lot of agents and brokers and they would never allow themselves to be cut off at the knees by sloppy legal practices.

And your dicho: if the cat runs from the attorney, what does that make him? A bigger rat?

I do realize the Notario is needed for the closing.  We are not attempting one without a Notario, but we want an attorney as an independent reviewer.

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1 hour ago, ComputerGuy said:

Unbelievably blanket statement. A broker will not do a closing without a notario, period. To suggest such widespread collusion and laziness... based on what information? I know a lot of agents and brokers and they would never allow themselves to be cut off at the knees by sloppy legal practices.

And your dicho: if the cat runs from the attorney, what does that make him? A bigger rat?

I never wrote "A real estate broker will do a closing without a notario".  Period.  Entiendes?

If a cat runs from an attorney, then that makes the attorney a junk yard dog.  That is the one you hire.  Entiendes?

I have had several real estate transactions in various states of Mexico in the last twelve years so I speak from personal experience.  You have nothing to lose and everything to gain from acquiring independent legal counsel in these matters.

Two weeks ago in Chapala, an American real estate agent came into the notario's office acquiring about his "fee" in Spanish.  I understood all.  End of story.

Six weeks ago, in a closing I discovered an error that could have cost me $20,000 USD.  The notario's assistant left the room for about 10 minutes then resurfaced with a fraudulent email that he claimed that he had sent me.  That did not go well for them.  Not a direct attempt to defraud me, but just sloppy work on their part.  We are resolving the problem now.  If I had not caught the error or if I did not speak enough Spanish to understand the process, then guess what?  SOL.

There are some reputable brokers at lakeside and there are some who are not so reputable.  Does not matter how long they have been in business.  The real estate turnover here seems to average about every 5 years, so no problem for them.  Buena suerte.

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10 hours ago, Zeb said:

I do realize the Notario is needed for the closing.  We are not attempting one without a Notario, but we want an attorney as an independent reviewer.

I am sure you do, and my comment wasn't aimed at you, but at the suggestion that the way things are and have been handled, are incorrect. I would never disparage someone from trying to ensure the best outcome, especially here.

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10 hours ago, Kiko said:

I never wrote "A real estate broker will do a closing without a notario".  Period.  Entiendes?

If a cat runs from an attorney, then that makes the attorney a junk yard dog.  That is the one you hire.  Entiendes?

I have had several real estate transactions in various states of Mexico in the last twelve years so I speak from personal experience.  You have nothing to lose and everything to gain from acquiring independent legal counsel in these matters.

Two weeks ago in Chapala, an American real estate agent came into the notario's office acquiring about his "fee" in Spanish.  I understood all.  End of story.

Six weeks ago, in a closing I discovered an error that could have cost me $20,000 USD.  The notario's assistant left the room for about 10 minutes then resurfaced with a fraudulent email that he claimed that he had sent me.  That did not go well for them.  Not a direct attempt to defraud me, but just sloppy work on their part.  We are resolving the problem now.  If I had not caught the error or if I did not speak enough Spanish to understand the process, then guess what?  SOL.

There are some reputable brokers at lakeside and there are some who are not so reputable.  Does not matter how long they have been in business.  The real estate turnover here seems to average about every 5 years, so no problem for them.  Buena suerte.

You certainly implied they would. Entiendes? Probablamente no.

And your wild accusations have not helped the cause at all: how many people do you suppose now distrust everyone in the business, thanks to you. Entiendes? Probablamente no.

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You don't know me, and to go around making comments about my life is just self-aggrandizing.

We did buy a house here about 13 years ago in Riberas. We also sold it some years later. Not long therafter, we rented from an agent who owned the property. Also, in an earlier job selling ads for a local English-language magazine, I got to know every realtor in town. I have an acquaintance with several notarios and lawyers at functions I attend. Do I need to ask you what your experience is, to try and call me out on this? Don't answer that.

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Old  news but a copy and paste from the Informador a few years back.  Not much has changed,  Just a small example of collusion,   Fines 24,373,975.00.  Always get your own independent legal counsel.  Remember the Buyer has the right to choose the notario.  You can find links on other webboards with details.   

The Federal Competition Commission (CFC) imposed economic sanctions on 33 commercial agents related to the housing market on the banks of Lake Chapala

MEXICO CITY. The Federal Competition Commission (CFC) imposed economic sanctions on 33 commercial agents related to the housing market on the banks of Lake Chapala, for the commission of absolute monopolistic practices.

The antitrust agency said that it is 14 real estate agencies, 15 runners holders of these agencies and two independent real estate brokers, as well as AC Lake Real Estate Group, which brings together these agents and the Mexican Association of Real Estate Professionals, Section Chapala AC .

He said a total of 24 million 373 thousand 975 pesos imposed fines ranging from 35,000 pesos to four million 239 488 000 577 pesos for each trader, according to the economic capacity and participation of everyone in the monopolized market.

Through a statement, the FCC stated that the House found that sanctioned agents commission agreed to set a single charge for the provision of real estate services, nullifying competition between them at the expense of consumers of these services, which is a violation Article 9, Section I, of the Federal Law of Economic Competition.

The CFC president Eduardo Perez Motta, said "beyond the direct economic impact on the market in Chapala, this case is a clear sign that the CFC monitors real estate markets around the country." He said the agency "will not hesitate to impose sanctions where it finds monopolistic practices to the detriment of the consumer."

Sanctioned operators have 30 working days to lodge an appeal before the CFC. (NTX)

Main sanctioned

• Mexican Association of Real Estate Professionals, Section Chapala
• Harmonic Architecture
• Good Weather Realty
• Ajijic Property Trust
• Casa Mexico MLS, Real Estate
• Chapala Realty
• Continental Realty
• Eager and Associates
• Hernandez Realty Group
• Real Estate Interlago
• Laguna Real Estate
• Properties by the Lake
• Off Realty
• Luis Fernando Rojas Arias
• Real Estate The tepal
• Sandra Elizabeth Allin Brisco
• Dixie Leen Ann Nicholson
 
 
 
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We've had property dealings with two local Notarios, Sr. Luis Enrique and Sr. Uriarte.  Both were handled very professionally and were completely trouble free.  We did not see the need for an additional attorney and it was never suggested we could not chose the Notario. 

Kevin Collins of Collins real estate assisted us on the purchase of our primary residence and we found him to be very well versed in the process and professional.  We would recommend him to anyone.

We are currently doing another settlement with Sr. Uriarte on an apartment we bought to house the Oaxaca students we help to attend Iteso.  This too is going very smoothly.  Our agent on this last one is Karen Julieta Cabrea Corrales of Century 21 Continental in GDL.  She too has been outstanding, actually detected a major fraud in a property we first wanted to buy.  If you do get involved in buying something in GDL I recommend her completely.

As part of the process involving the property with a fraudulent deed she informed us that it has been determined some 15% of properties in GDL may have title/deed irregularities.  Also, the real estate market there is really chaotic compared to the relatively well organized one here.  For example there is no centralized and comprehensive MLS, just one attempt at one by a few brokers plus a hodge podge of internet listing sites which are poorly managed and full of already sold properties.

By all means use an attorney as an additional safety factor if it raises your comfort level.

 

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Think about this scenario:   Buyer has the right to choose the Notario.  When the buyer's agent advises buyer to go with Notario A at the request of the seller, and of course your agent knows Notario A well so he is a strong advocate for this Notario.  In past times,  this Nortario  oftentimes would record the sales price in the deed at a mere fraction of the actual sales price, because he is doing you a favor to keep your taxes low or whatever, or the usual  "That is the way we do it here."  You do not speak Spanish or understand the process nor do you have independent legal counsel so guess what?

Here is the math,  Contract sales price of your first property is $500,000.  You transferred $500,000 USD to the notario at closing, but your deed reflects a sales price of 100,000 USD.  A few years later you decide to sell your home for 600,000 and the buyer picks Notario B.  The sales price recorded on the sale of your property by Notario B is the actual contract sales price that is reflected on the new deed, 600,000 USD. 

Hmmm, So now you have a 30% capital gains tax on the difference of 600,000 less 100,000, so taxed on 500,000 gain.   Your financial liability for capital gains is 30% of the difference 500,000, about $150,000.  In an effort to clean up this mess, SAT has changed some of the capital gains rules, but  do not be surprised  if you come up short.  Nowadays there are some  band aid remedies around this,  but of course that will cost you  money with the Notario to "fix" their first mistake.

I agree that most Notarios, brokers, and agents are honest to a point, however, due diligence on buyers part should be a priority.

Get independent counsel.

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Agree with Kiko and recording sales prices under the true amount was common for a long time. Not sure if it still is.  However, remember that all deeds are recorded in Pesos, not USD. So as the peso has weakened you will, on paper, have a much larger gain than you really do. Definitely talk to a lawyer about how you can legally avoid capital gains tax before you list your property. It may be different in different parts of Mexico. Usually Notarios in an area agree on what the "proof" will be to a seller.  Here in PV it involves being Permanente and having your RFC on your CFE bill for at least 6 months.  That's today.  Who knows what it may be tomorrow.

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Notarios, in Mexico ARE ATTORNEYS, who are especially trained, experienced and vetted in real estate law, wills, etc. They are appointed to Notario status by the state government.  Only they can handle real estate closings; neither lawyers (abogados) nor real estate brokers, or agents, who have no government oversight, registration or regulation in Mexico.

A Notario in Mexico is a highly trained professional;  not anything like a notary public in the USA.

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Kiko stated:

"Here is the math,  Contract sales price of your first property is $500,000.  You transferred $500,000 USD to the notario at closing, but your deed reflects a sales price of 100,000 USD.  A few years later you decide to sell your home for 600,000 and the buyer picks Notario B.  The sales price recorded on the sale of yourproperty by Notario B is the actual contract sales price that is reflected on the new deed, 600,000 USD. "

Kiko thinks a person would't  know enough to very closely check the numbers. He is talking about someone so stupid they would never be in the position to buy property. He also has never bought property in Mexico. If he had he would definatly know for sure you never transfer the money for a buy to the Notario/a. You transfer the money to the seller and all is documented. How dumb do you think we are here?

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I own several properties here. And yes the money is transferred to seller.  I did not see the need to write that in to clarify.  The net effect of the above scenario is that today buyers can expect little wiggle room on price.  I checked with three of my friends here and they checked their deeds.  In each case the sales price recorded did not match the contract sales price.  They are on the hook for large capital gains taxes.

Have a nice day Alan mexicali.

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Depends on the amount of the gain and any previous sales in a three year period.  It can get complicated. Now you get a blanket 200,000 USD exemption. So if you are clean for 3 years, no other sales, then in the example above where the sales prices were not accurately reported,  then the 500,000 gain would be reduced with your blanket exemption 200,000 to a 300,000 gain.The tax then owed would be around 90,000 USD.  If you have sold one other property in this three year window and applied your 200k exemption on that sale, then you are back to paying a 30% tax on 500,000, so 150,000  tax owed to SAT.  There are some tricks like gifting ownership to another family member provided they have a temporal or permanente visa.  Then you pay a 3% transfer tax.  It gets complicated. Everyone's situation can be different, so the point is get independent legal counsel.

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18 hours ago, Zeb said:

I'd appreciate some attorney referrals to go over some real estate contracts and verify closing documents.  I do understand the Notarios do this.  I want an attorney to verify the Notario's work.  I already know about Spender, so if anyone has other referrals, I'd appreciate it.

A Notario is an attorney with additional training who was appointed by a state's governor and approved by the federal government. You cannot have an attorney approve the work of an attorney who outranks him and for which the attorney has no training.

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