LEI Mexico FAQ’s

Creation of the Land Trust (Fideicomiso)
Mexican law currently requires that in addition to obtaining a valid entry visa, foreigners wishing to acquire property for residential usage must have the title to their property transferred to a Mexican bank. In order to do this, the foreigner must establish a land trust (fideicomiso) in which they are the beneficiary. The bank has the responsibility of ensuring that all elements of the Trust are fulfilled.

While the bank owns the real property rights, the beneficiary (equitable owner) owns the personal rights to use, rent, modify or transfer his rights to a third party. These personal rights are evidenced through a deed prepared by a Mexican Notary, signed by the representative of the trustee bank and duly registered with the appropriate local authorities.

The Foreign Investment Law of 1993 stipulates a term of 50 years for the Trust with opportunity to renew the trust for multiple 50 year increments. By requesting renewals every 50 years a property may be held by a family or business entity in perpetuity. The filing for this renewal must take place on the forty ninth year and between the sixth and seventh month prior to expiration.

Since by law, Mexican banks enjoy government protection against bankruptcy, the Trust is indirectly guaranteed by the government. For this reason, even in unrestricted zones many foreigners prefer to hold their property in Trust.