MEXICO PROPERTY CLOSING COST BREAKDOWN
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Q: Who pays the closing costs when a property is sold?
A: The buyer does. The transfer of acquisition tax (2-3% of the appraisal value), notary fees and expenses and all other closing costs are paid by the buyer. Closing costs vary between 4-8% of the purchase price (much of which is depending on the value of the property). The seller is expected to pay the commission, plus IVA (16% tax on commission amount), as well as any capital gains on the increase and capital gain in value of said property. Very similar to tax laws north of the border.
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Here's a complete breakdown in costs:
The closing Costs in Mexico consist of various fees and expenses and generally total between 4% to 6% of the actual purchase price (higher if there is a mortgage involved). These costs are always the responsibility of the buyer. The seller will bear the cost of the real estate fees and his capital gains taxes, as applicable.
Please note that these fees are in USD $ and are to be used as a guideline only and are approximate. They will vary according to the size of the transaction and the current exchange rate.
The closing costs are generally as follows:
• Transfer tax: 2% State Tax
• Trust Permit: $1,200 Department of Foreign Affairs Mexico City
• Foreign Investment Registry: $700 Department of Foreign Investment Mexico City
• Trustee Bank Acceptance Fee: $550 in whichever Trust Division of the Trustee Bank is located in Mexico.
• Trustee Bank First Year’s Trust Fee: $550 in whichever Trust Division of the Trustee Bank is located in Mexico.
• Appraisal for Future Tax Assessment: The appraisal for Future Tax Assessment in Mexico varies with property size with locally certified appraiser.
• Non-Encumbrance Certificate: The Non-Encumbrance Certificate from the Land Registry Office (LRO) in Jalisco or Nayarit is approximately $15.
• Preventative Notice Advice: The Preventative Notice Advice from the LRO are approximately $30 for 2.
• Registration fees in the LRO: Registration fees in the Land Registry Office varies from .5% to 1.0% (Jalisco/Nayarit).
• Notary Fee: The Notary’s fee in Mexico varies from .5% to 1% depending upon transaction size.
For more information, please contact Geordie Seed @ +52-322-188-0208
via WhatsApp, or visit us at www.nayaritliving.com