The process to purchase property in San Miguel is fairly straightforward. 

After you have chosen the property you like the best, a written offer to purchase is prepared by your agent and presented to the seller’s agent. This offer includes the offered price and other details such as the length of time the offer is valid, a request for inspection, the preferred notario, deposit requirements, escrow requirements, the closing date, and so on. 

The seller may counter on the price, the closing date, or any of the other terms specified. Although some offers to purchase are immediately accepted, some will go back and forth a few times between the seller and the buyer before the two parties come to an agreement.

When the offer to purchase is accepted, both the buyer and the seller will sign the original offer with the annotated revisions or, a new version, which includes all of the revisions, will be drafted and signed by both parties. Although some buyers and sellers go to closing using this original offer to purchase, it is not unusual that one or both parties request that the notario draft a more formal Contract to Purchase based on the final offer to purchase, and both parties will sign again. 

Once the Contract to Purchase has been signed, an escrow account is opened, which requires all parties to also sign the escrow agreement.  

The next step is the inspection. A specific number of days are usually specified for the buyer to complete the inspection and make the deposit. Generally, our agency tries to facilitate the inspection and receive the results before the buyer transfers the deposit. 

Once the inspection report is received and accepted, the buyer will transfer the deposit to the shared escrow account. This amount is usually 10% of the purchase price plus half of the escrow fees.

It is the buyer's 10% deposit that signifies that the property is officially "under contract" and can no longer be shown to other potential buyers.  

However, before this deposit is made, the property can continue to be shown. If a competing offer comes in at this stage in the process, in most cases it will be held as a back-up offer in the event that your deal doesn't go through.

While the inspection and deposit are being completed, the notario will simultaneously prepare and ask you to sign the permit required for foreigners to purchase a property in Mexico. This permit is most often referred to as an SRE permit.

As the closing date approaches, your agent will also be working with the notario to finalize your closing costs and calculate the total amount of money you will need to transfer to the escrow company to complete the purchase. The final transfer will include the remaining 90% of the property price, your closing costs, and an extra amount to cover fluctuations in the exchange rate. Generally speaking, this final transfer must be received by the escrow company three to five days before closing.

It is not until the day before closing that the notario can "fix" the exchange rate which will be used at closing and which is necessary to calculate both your exact closing costs and the capital gains tax of the seller. Once these final figures are "fixed," the agents involved will draft the distribution of funds document that both the buyer and the seller will sign at closing. 

At closing, the seller's agent or representative is required to present several documents. The first is proof that any domestic employees who were working at the property have been properly terminated and paid the required severance. This is to protect the buyer from inheriting any previous employee disputes or liabilities.  

In addition, property tax receipts and utility bill receipts are also presented as paid. If these bills have not been fully paid, adjustments will be made to each party's proportional share and will be added or subtracted to the distribution of funds.

Both the buyer and the seller will sign the new deed, as well as a “know your client” form required by the notario.

Once the transaction is completed and the new deed and distribution of funds has been signed by all parties, the notario securely sends these documents to the escrow company and authorizes the distribution of funds according to the agreed upon terms.

Before you leave the closing, you will receive a simple copy of your new deed. It will take from three to eight weeks for you to receive the deed after it has been accepted and recorded in the public registry.

We like to say that although the closing process isn’t rocket science, it does include several hoops to jump through and frequent rule changes. Our agents not only stay up to date on these changes, but they are also well trained in the whole process, and work with our in-house closing specialist to make the process as smooth as possible. You can rely on our experienced team to answer your questions and protect your interests from start to closing.