A real estate agent will be asked to find the client a prospective buyer, the buyer will want to fall in love with the house or condo, but it is up to consultants like me to make sure the pair are a good match an that the deal is sexy and sweet, but smart.
Sometimes or most of the time, many people dedicate more time to planning things that they find more important than estate planning—deciding who will inherit their assets after they’re gone.
It may not be as fun to think about as planning a vacation or buying a new car, but without estate planning, you can’t decide who gets everything that you worked so hard to get.
The worst decision you can make when you have issues with your landlord is to withhold rent and or to try and live the last month of the lease on a security deposit. Why? Because for one you have no rights to a lease when you are not current in rent and a Court will not accept your case unless you are current and you demonstrate that with receipts, second, I never have seen a lease where the tenant is allowed to live on the security deposit.
Yes, I often write about lousy landlords, but I also know about a number of lousy tenants who seem to relish causing trouble, not paying rent, and sometimes even subletting without being authorized to do so.
Yes, there is escrow in Baja California and Baja California Sur, and yes, you should demand Escrow to be involved in your transaction. There are several reliable options available in most cities, such as in Rosarito, and in Los Cabos and La Paz.
Being in escrow is a contractual arrangement in which a third party receives and disburses money or property for the primary transacting parties, most generally, used with plentiful terms that conduct the rightful actions that follow. The disbursement is dependent on conditions agreed to by the transacting parties.
Attorney at Law / Licensed Exclusively in Mexico
The Lease Agreement
(Be careful what you bargain for)
Once an offer for a lease is accepted, a formal written rental agreement must be signed by the parties, all rent payments must be secured with a receipt.
If value added tax is added to the payment of rent, an invoice must be issued by the landlord to the tenant (an invoice is not a receipt).
The rental agreement is a private contract which allows the tenant temporary use of a property in exchange for a specified amount of rent. Rent is usually paid on a monthly basis, unless specified otherwise in the contract. It is advisable to have the contract reviewed by a lawyer to ensure that its terms do not violate the civil code. Estate agents generally ensure that this is done.
A common problem surfaces when a seller requests or demands that the buyer declares to the notario that the price paid for the property is lesser than that which was agreed.
How does this work?
The seller tells the buyer that if the actual sales price is declared to the notario this will result in excessive annual property tax, FALSE!
Some Sellers that are unaware or do not qualify for tax exemptions (such as that provided by article 93 of the Federal Income Tax Law) go to extents to avoid paying capital gains and when they persuade the buyer to consent in declaring a lower the price to save capital gains, they will then ask for 2 checks to be handed out.
One check is to be declared to the notary as the sale price for tax purposes and the second check (given under the table) covers the difference that would make the gain taxable, the problem is that if the buyer is unaware of this it will then become an issue if and when the buyer decides to sell the property because he actually consented to inherit the seller’s tax liabilities.
Attorney at Law / Licensed Exclusively in Mexico
Buying or Selling in the Rosarito Beach Area? Call Us!
Kanoa interviews Rafael Solorzano, a Baja Real Estate Attorney, regarding the importance of having a professional handle the closing process in a Real Estate purchase transaction.
Rafael among other topics also stresses the importance of doing due diligence and how he’s able to complement the work of a real estate professional.
Here’s a list of questions Kanoa asked Rafael:
1:18 – Please introduce yourself and tell us about what you do
6:57 – Tell us about your Facebook group Baja Living Advice
9:53 – How can people avoid problems with their transactions?
15:03 – How can you complement a real estate agent?
18:32 – What is the importance of disclosures, and due-diligence?
23:46 – What would be your advice to buyers today?
31:59 – Who would be your ideal client?
34:15 – What is the expectation of clients regarding discounts in Mexico?
39:40– Can people enjoy their experience buying a property in Mexico?
41:42 – How can you contact Rafael Solorzano?
+52 (664) 188-7001
Here is a refresher on your rights
and obligations regarding leases
Civil Code for Baja California
ARTICLE 2272.- A lease consists of the agreement between two parties which reciprocally agree to, on one part, to allow the temporary use and enjoyment of something, and the other to pay for that use and enjoyment a price that has been agreed.
Every week I review documents sent to me by clients which where drafted and signed by parties in a real estate deal, most of such documents are not compliant with Mexican Law, call them to purchase agreements, promissory letters, etc. why? I already stated that they are not compliant with our laws, also, many times these documents are drafted in a foreign language.
What Does The Law Say About It?
Not a week goes by without me receiving several calls or messages having to do with Landlord abuse, among which failure to make timely and proper repairs to the property, pocketing the security retainer, among others.
This is a common and recurring scenario: Your landlord required you to pay thousands of dollars in cash upfront for either a 1 or 2-month rent payment plus a security deposit when leasing the property. Just as they hand over the keys, you are rushed o sign the lease and skip a “Move-In Inspection,” of course. After you move out, no matter how many days you spend scrubbing the place, the landlord does its own walk-through, conjuring any discrepancy they can muster in the place. It doesn’t matter if the discrepancy or rubbish existed when you moved in or not.