After the Offer: Next Steps

by San Miguel MLS on October 1, 2024

Once the “Oferta de Compra” (Offer to Purchase) has been accepted by both the buyer and the seller, the next step in the real estate purchase process in Mexico is to formalize the agreement and ensure all legalities are properly addressed. Here is an outline of the next steps:

1. Hire a Notario Público (Public Notary)

In Mexico, a Notario Público plays a crucial role in real estate transactions. They are responsible for:

• Verifying the legality of the property title.
• Ensuring that there are no outstanding debts, liens, or other legal issues attached to the property.
• Drafting and formalizing the “Escritura Pública” (Public Deed), which is the official contract of sale.

Step for the Buyer:
Hire a qualified Notario Público to handle the process. The Notary will also calculate taxes and other fees related to the purchase.

2. Due Diligence

The Notario will conduct the due diligence process, which includes:

• Title Search: Verifying the ownership of the property and ensuring there are no outstanding liens or legal disputes.
• Property Valuation: Ensuring the property is properly valued and checking that all taxes have been paid by the seller.
• Verification of the Seller’s Legal Standing: Confirming the seller has legal capacity to sell the property.

Step for the Buyer and Seller:
Both parties may need to provide documentation to the Notario, such as identification, proof of tax payments, and ownership documents.

3. Drafting of the “Contrato de Compraventa” (Purchase Agreement)

Once due diligence is complete, the Notario will draft the “Contrato de Compraventa”, the official contract that outlines:

• The final purchase price.
• Payment terms and schedule.
• Any contingencies (e.g., repairs, inspections).
• The closing date.

Step for the Buyer and Seller:
Review the “Contrato de Compraventa” and make sure all terms are clearly outlined and agreed upon before signing.

4. Payment and Escrow (if applicable)

Depending on the agreement, the buyer will:

• Pay the deposit (if not already done).
• Transfer the remaining funds (through a bank transfer or escrow service) in line with the payment terms.

Step for the Buyer:
Make sure funds are ready to transfer and that you understand the payment schedule outlined in the contract.

5. Closing and Signing of the “Escritura Pública” (Public Deed)

Once all payments have been made and the necessary documents have been gathered, both the buyer and seller will meet at the Notario’s office to sign the “Escritura Pública”. This makes the transaction official and legally binding.

Step for the Buyer and Seller:

• The buyer must pay the final purchase price (if not already paid).
• The seller must hand over the keys and vacant possession of the property.

6. Registration of the Property Title

After the deed is signed, the Notario will register the property with the Public Registry of Property to transfer the title to the buyer’s name. This can take several weeks.

Step for the Buyer:
Wait for the official property title to be registered and delivered. Keep in contact with the Notario to ensure the process is completed.

7. Final Costs and Taxes

The buyer will need to pay various closing costs, including:

• Notary fees.
• Property acquisition tax.
• Registration fees.

Step for the Buyer:
Be prepared to pay closing costs. These fees are typically calculated as a percentage of the property’s sale price.

By following these steps, you can ensure that the real estate purchase process in Mexico proceeds smoothly and legally. Having a qualified Notario and understanding the steps involved will protect both buyer and seller and guarantee a successful transaction.