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Title Insurance Makes Buying
Safe in México
Title
insurance is a special type of insurance that protects the
expatriate community in México from loss on a specific piece of
property. A Title Insurance Policy provides security against the
loss of land as a result of a title problem. Title Insurance can
be purchased with or without limitations and exclusions. When
purchasing property in the United States, most Banks and
Mortgage companies require Title Insurance prior to granting a
loan.
It is important
when purchasing real estate in México to understand a Fidiecomiso (Living
Trust)
DOES NOT
take the place of or exclude the need for Title Insurance. A Fidiecomiso can
be dissolved in the event of Fraud, Errors and Omissions and certain
government and Ejido claims.) When purchasing Title Insurance in México, be
sure to read the master policy thoroughly and check for limitations and
exclusions.
Some
title insurance companies insure only the Fideicomiso (Living Trust) and
exclude fraud, government and Ejido claims, even certain developer liens.
This should not be acceptable. When purchasing title insurance in México
make sure that the policy is on the land not just the Fideicomiso.
Buying
a home anywhere is one of the most important decisions anyone makes and now
that title insurance is available in México, people can have a lot more
confidence in purchasing a home or a condominium.
What additional benefits does a title policy
provide?
Since title policies are fully negotiable contracts of indemnity,
a title company can consider and insure a variety of title matters for the
benefit of the proposed insured. For example a title insurance policy has
the ability to provide affirmative coverage and endorsements that
protect purchasers against risks that may be discovered in the title search
process. How can any one individual, even a notario publico, give these
types of assurances that have real dollars standing behind the assurance and
that ultimately will protect a buyer in the event of a loss?
Never forget one thing, no matter who
tells you that title insurance isn't necessary, just remember that it is the
ONLY monetary indemnification that you
will receive protecting your ownership rights.
Along with title insurance comes U.S.
Escrow. Both Stewart Title and First American are offering that service even
if you don’t have a title insurance policy yet.
Why risk your deposit when the Escrow Company will
supervise the release of it to the developer?
This is not to be confused with a real estate company escrow account in the
U.S. Your escrow is not covered by the same laws it would be if the property
was in California so the real estate agent is free to keep any portion of
the deposit.
Some of the Baja real estate companies are now offering Title Insurance as a
way of protecting their customers and a few like Baja Relocation, won’t sell
property without Title Insurance. If your realtor doesn’t, ask for it as
part of your offer to the buyer.
Developers have also begun to
get title insurance on the land before selling and the buyer can obtain an
individual policy at settlement. If you are considering purchasing a home or
condo that does not offer a title insurance policy on the land but tells you
that you can get one when the development is finished, consider how you will
do that if there are liens or title disputes on the land. And if your agent
is willing to sell you this kind of property, be aware that the agent will
get paid when you make your deposit to the developer so they have nothing to
loose if there are problems. You can be sure they will not stick around to
help you if they have already been paid. If there is not a clear title you
will also not be able to get a bank trust and for foreigners it is
impossible to own land in this part of México without a bank trust. Not a
Master Trust, but an individual bank trust.
If all of this seems confusing , just
remember , Title Insurance and Title Company Escrow are the only safeguards
you have in a market where real estate agents have no licenses. Look for
Developments that have both of these safeguards.
Here are a few safe bets:
Waterfalls at Malibu
Trump Ocean Resort
Santa Barbara at Bajamar
The Residences at
Playa Blanca
The Park at Malibu
Alta Vista
El Sahuaro
del Mar
What is Voucher
Control and why do I want it?
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