Once you have found your dream home, it is time to negotiate the terms of sale. Be sure that you have a knowledgeable real estate professional to guide you through this process. A good Offer to Purchase is the template and guide to creating the promissory contract. The more information both the buyer and the seller agree, the less likely it is that a sale will fall during the closing process. It is important to protect yourself from investing money that the seller can’t or won’t return if the sale is not completed.
First Things First
First, of course, the names and personal information of the buyer and seller. Sometimes the seller’s agent will not share this information until the buyer accepts the offer, and the seller is ready to sign in agreement. Be sure to have this information added to your document.
Next is the sales price. It is important to specify how the buyer will pay, whether through deposits directly to the seller or deposited into an escrow account. If possible, specify the escrow company and who will be paying the fees associated with this service.
Consider Your Timeframe
Dates are important. There can be a significant difference between the time necessary for a foreigner to complete a transaction compared to a national. A seller needs to be aware of this consideration before accepting your terms. Be sure that you consider your timeframe for the transfer of funds. The type of account the funds are located can affect this, the time of year, or the individuals necessary to release the funds. If your financial advisor is on vacation, can someone else approve the transfer of your funds? Is there a national holiday in Mexico or your home country?
What Should Your Offer to Purchase Include?
Be sure that your offer to purchase includes as much detail about the conditions of your purchase. If you are buying pre-construction, the developer should include specific items – appliances, golf memberships, bonus gifts, etc. If it is a resale, the seller should inform you about any changes, repairs, or exceptions. Most resales are “as is” unless otherwise noted. These are often areas that your agent can help to negotiate.
And When it Comes to Legal Considerations…
The last area to address is any legal considerations. An Offer to Purchase is a legal agreement in which it is important to consider what might happen if either the buyer or the seller do not meet conditions. Some items to consider:
- Does the buyer need to secure financing? If they are unable, what occurs?
- What happens if either party withdraws from the agreement?
- What happens if, during the due diligence performed by your attorney, you discover a title defect?
- When purchasing a lot, what if the property is unable to accept construction?
- Who is responsible for paying the sales commission?
- Although legally, Mexico requires the title deed to reflect the actual monetary value paid to a seller, it is still common practice in some areas to record a lower sales price. It can be helpful to address this in the OTP.
The first step on the path to ownership is the Offer to Purchase. It is safe to say that if you have concerns, it is better to address them early in your closing process.
If you have more questions regarding purchasing Mexico real estate, don’t hesitate to contact us! At Top Mexico Real Estate we can provide you with all the information regarding real estate processes.
Remember, at Top Mexico Real Estate… we make it happen!