1. What is the difference between a trust and a promise to trust at closing? … When closing on a trust in front of the notario all beneficial rights of interest transfer to the buyer. When closing on a promise to trust the seller retains legal title and buyer has only equitable title, no beneficial rights of interest transfer

2. What is the difference between a disbursement instruction, an escrow instruction and a letter of instruction? … Disbursement instructions instruct the escrow agent / title company where and to whom to send the proceeds of the sale upon close. Escrow instructions are an agreement between the escrow. The letter of instruction is given by the seller under a trust to the bank (trustee) to either extinguish or transfer his or her interest in the trust to a named third party in the letter.  

3. What is the next step after escrow instructions? … Send escrow instructions to the title company and receive a file number so that you can wire the founds to an account, do not wire funds without a file number to reference. 

4. What purpose do escrow instructions serve? … It outlines the amount of funds the escrow company will hold and what the responsibility of the escrow company is during the time hold they hold the funds and clearly defines the disposition of those funds in regards to the parties. 

5. What is possible reason the Mexican Government established the “Restricted Zone”? … Mexico lost 1/3 of the country to the United States in the 19^th Century. 

6. What are the excluded areas in the “Restricted Zone”? … 31 miles from the coast line and 62 miles from the international border. 

7. A fideicomiso is a lease? … No, the beneficiary can sell, lease, develop and mortgage the property at any time, i.e. bundle of rights.  

8. A fideicomiso can be used by? … Foreigners, Nationals, Mexican corporations with foreign investments. 

9. What is a Cession of rights in a trust? … It means that the buyer is assuming the seller´s existing fideicomiso with the remaining years on it and having it put into his or her names(s). Saves money and time by not having to get a new permit.  

10. What is a capital gain tax? … This is a tax to the seller by the government on the sale of real property wherein the tax is based on the difference between the amount paid for or registered value in the trust or escritura and the amount the property sold minus certain costs and fees allowed by law.  

11. Does the buyer get a legal title when the seller carry´s back a mortgage and closes on a trust? … Yes, but the seller will have a mortgage lien field against the property. 

12. What is a devise? … Transferring title to real property by means of a will. 

13. What are the term, intestate and escheat? …Dying without a will and escheat means the property goes to the government.  

14. What is a “Notario Publico” ? .. An attorney that has practiced the law for at least five years passed an exam and was appointed by the government. Give advice to parties on how to comply with the law, but cannot litigate, can close real estate transactions and is a real estate attorney and tax collector.  

15. What is the percentage of the purchase price, known as the Acquisition Tax, which is paid by the Buyer to the Government? 2% 

16. What is the investment clause in a trust? … When purchasing raw land in excess 2000 sq meters (0.5 acre) a minimum investment of i.e. $ 250,000 usd. The larger the property, the larger amount of investment to made by the buyer.   
    
    

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