A Private Mortgage Fund Secured

Secured by a first mortgage underwritten on a less than 50% loan-to-value.

Over 65% of construction completed with no registered debt.

First mortgage funds required for completion 9,000,000.

Projected surplus 10,140,000.

More than 1M Foreign Buyers Own Real Estate in Mexico Through the Irrevocable Bank Trust, Fideicomiso

What is the Fideicomiso?

The Fideicomiso is a 50 year, perpetually renewable, irrevocable bank trust, which allows foreign investors to acquire absolute and irrevocable ownership rights to property in Mexico within the designated restricted zone (31 miles / 50 km of an ocean).

How does the Fideicomiso work?

A Mexican fiduciary bank holds the legal title of the property but cedes all of the rights of property ownership to the purchaser.  The bank grants the purchaser the rights to occupy, sell, lease, improve, change, use, bequeath, and encumber the property.

Why does the Fideicomiso law exist?

Under the Mexican Constitution of 1917, foreign ownership of land within 62 miles of an international border, or 32 miles of an ocean, was banned.  In the early 70’s, notaries and other business figures in Mexico recognized the immense asset that Mexico’s 5,800 miles of coastline represented.  As foreign funds were paramount for economic development, it was necessary to find a vehicle to bridge the gap barring foreigners from purchasing land within the restricted zone whilst not violating the Mexican Constitution; the solution became the irrevocable bank trust, or Fideicomiso.

Is the Fideicomiso secure?

The Fideicomiso trusts are privately held, with the bank acting as the primary trustee.  Fideicomiso trusts are not assets that are recorded on the banks’ books and banks are not allowed to take any action without receiving instruction from the beneficiary of the trust.  If the bank goes bankrupt, the trust is easily transferred to another bank, so there is no risk involved.

Money Flow