What you need to know….

If you're looking to own property in Mexico, especially in those gorgeous beachfront areas, you've probably heard the term "fideicomiso" tossed around. But what exactly does it mean, and what’s a “fideicomiso de garantía”? Let’s break it down in a simple, no-nonsense way!

Fideicomisos: Owning Property in Mexico

Foreigners (like you and me) can own property in restricted zones in Mexico—think those dreamy beachfront spots—thanks to something called a fideicomiso. It’s essentially a trust where a Mexican bank holds the title to the property on your behalf. You still get all the benefits of ownership, but the bank is the trustee.

Fideicomiso de Garantía: Collateral Trust

This type of fideicomiso is a bit different. Instead of using it to own property, you’re using it to secure a loan or fulfill some other obligation. Think of it as putting your property in a trust as collateral. It's a popular tool when you need to guarantee a payment or another financial commitment.

Bank Trustees: Who’s in Charge?

Not all banks are in the business of fideicomisos de garantía. Some specialize in it, while others stick to regular fideicomisos. Plus, each bank has its own terms, costs, and requirements. So if you're planning to set one up, you’ll need to know which banks are currently managing these trusts and what their specific conditions are.

In Puerto Vallarta, several banks offer fideicomisos de garantía, which are used to secure loans or financial obligations by placing assets into a trust. As stated ….this type of fideicomiso ensures that if a borrower can't repay the debt, the assets in the trust can be used to cover the obligations. Some of the banks and institutions that offer these services include:

1. Banorte: They provide fideicomisos de garantía to secure payment obligations, ensuring creditors are repaid if the borrower defaults.

2. Financial Warehousing of Latin America (FWLA): They also offer fideicomisos de garantía, primarily for securing loans on movable and immovable assets.

These trusts are commonly used in real estate transactions or large financing projects, helping protect both the borrower and lender by securing the loan with valuable assets, like property or shares. If you are working with large financial obligations, these institutions are great resources to explore.

Will Hutt

Coldwell Banker La Costa

Will.Hutt@cblacosta.com 

www.williamhutt.mx