When purchasing Mexico real estate, after the buyer accepts your offer to purchase, you will receive the promissory contract. If your offer document has excellent details, it is a great framework for preparing your new document that will bridge the time between your offer and signing your title deed. Typically, the buyer is responsible for generating this document. However, in pre-construction, the developer usually has a template of a contract and will generate one for the transaction. In this case, your legal representative will verify the document rather than create it.
The promissory contract should include:
- The legal description of the property and all individuals involved. If you’re purchasing from a corporation, the contract should include the legal description of the representative and proof of their right to sign on behalf of the corporation.
- A detailed listing of all payments – the amount, the date or construction milestone, and how you will make the payment. Account and transfer information should be in the document.
- Usually, this document doesn’t include specific dates for the physical and legal delivery. However, limits or deadlines are very important.
- The promissory contract includes for the first time a detailed listing of any penalties. Your legal representative should help to make sure that the penalties are reasonable and fairly distributed.
Promissory Contract for a Resale Property
A contract for a resale should include an inventory of all items included, as well as any excluded items. If there are items that need repair, your contract should mention them. Include a detailed list or video inventory as appendices to the agreement.
Promissory Contract for a Pre-Construction Unit
On the other hand, if you are purchasing a pre-construction unit, this document is of utmost importance. It acts as proof of ownership through the construction process and the period necessary to prepare and file all documents registering the completed property. Depending on the size of your community, the percentage completion of the development when you purchased, and the amount of time required for the municipality to complete the process, it may be possible to title the property when you take possession. There may also be a significant delay between taking possession of the property and signing the title deed.
Moreover, in pre-construction, the involvement of the municipality can drastically delay the processing of paperwork. Elections, transfer of political parties, and economic cutbacks are a regular occurrence that affects the efficiency of the bureaucratic steps. Construction details, floor plans, a list of materials, and photos, if possible, are helpful and should be included in the contract as appendices.
A document that will protect you
In the event of things not progressing as either party has expected, a well-written contract can settle most issues without further legal actions. If issues cannot be resolved through mediation and legal proceedings are necessary, the promissory contract will be the guide. It is money well spent to have a reliable real estate attorney help you to ensure that this document adequately protects you.