It is not common to see independent attorneys representing the different sides in a sales transaction.
Because the attorney for the transaction is, more times than not, chosen by the seller or real estate agent, the foreign purchaser must take precautions to ensure that their interests are being protected by the attorney. It is obvious that the choice of Mexican attorney could not be more crucial. Folsom represented a U.S. purchaser of beach property south of Playa del Carmen where upon review of the deed, it was discovered that the attorney who drafted the deed named himself as the successor to the property after the death of the purchaser!
Due to the very competitive nature of the real estate market along the Riviera Maya, there is a growing tendency among real estate offices and title insurance companies to offer, "one-stop shopping", meaning that they provide the legal work necessary to transfer title. While this may or may not be the right decision for you, we would encourage you to make that decision from a position of knowledge and understanding and not just accept a recommendation.
In Mexico, professionals are not held to the same standard of scrutiny as we have in the U.S. Here, once the client signs a document, whether it is a tax form or land deed prepared by hired professionals, the client is responsible for its content. There is no legal accountability here and unethical professionals frequently hide behind the knowledge that if something goes wrong, there will be no repercussions for them.
Other fundamental differences in our two systems also warrant analysis by the potential purchaser. U.S. citizens are accustomed to land transactions that are heavily regulated. This means that standard form contracts have been scrutinized by state and local governments and pre-approved by the courts and therefore may be relied upon and presumed sound. Because U.S. citizens have this presumption of security around their U.S. transactions, they come to Mexico expecting the same security. Nothing could be farther from the truth.
Land transactions, particularly in the south of Quintana Roo, are ripe with intentional fraud and unintentional misrepresentation. The areas south of Tulum around Mahahual and the Sian Ka'an Biosphere are known to have some of the most highly litigated title problems in the country. This is due to various reasons: the historical land recordation system, the close connection to ejido and national lands, the unregulated land transaction industry, and to the naivety of the real estate purchaser in a fever pitch market. To repeat, your choice of attorney could not be more crucial.
When dealing with "one stop shop" attorneys, ask them what it is that they are going to do for the price that is quoted. Are you going to get an independent investigation of the transaction and a thorough legal analysis of all relevant aspects of the purchase? Are you going to get independent verification of clean title and other relevant governmental documents? Are they going to fix any problems that may exist in the paperwork? Do they maintain contact with the court system and other relevant governmental agencies so that they understand the current applications of, and changes to, the law?
This is no time to scrimp on costs. You need an attorney who will bring accountability to an otherwise unaccountable process. If you are not able to afford to determine whether your land purchase transaction is a sound one, then perhaps you should continue to shop for a property that allows you absolute certainty that the legal transaction is secure. There are so many wonderful properties available, if you are not sure that the legal transaction is up to your standards, do not go through with the purchase. You will find another incredible property. The best purchase is the one with the sound legal transaction.
One way to begin a search for Mexican counsel is to contact the local Consular Agent in the jurisdiction where the transaction is taking place. A list of all consular Agents and their respective jurisdictions can be obtained through the U.S. Embassy in Mexico City
The local consular agency should provide a referral list of attorneys in the area. However, care should be taken to determine whether the local consular agent has actual knowledge of the caliber of work preformed by the attorney. Inquiry should be made whether there is any criteria for an attorney to be listed with the consular agency.
It is important not to retain counsel just because he or she speaks English. Too frequently, foreigners select an incompetent or unethical professional just because he or she is the first contact in Mexico who speaks English. In fact, many Mexican attorneys and real estate agents speak English. It is advisable to obtain several references from people with whom the attorney has worked in the past. When interviewing attorneys and their references, be sure to weigh their responses carefully and consider cultural differences. For example, beware of professionals who appear to be anticipating the "right" answer, or telling the client what he/she wants to hear. It is best to find an attorney who is willing to admit that they don't know all the answers and will have to research an unfamiliar question. This is the professional who is willing to be totally honest with you. Additional questions to keep in mind are as follows:
Do you know the attorneys personally? How did you end up in their office? Do you have references? Can you speak to them? Do you understand Spanish/do they speak English? If they are speaking to you in English, are you very sure they understand what you are telling or asking them? Did they listen to you and fully understand your questions and answer them completely? Did they take the time to explain the documents needed for the transaction? Did they explain the typical clauses of the contracts? Did they explain the entire procedure? Did they give you a detailed list of the closing costs? Are you paying any of the transfer taxes? Did they explain the long-term effects of reporting a sale price in the contract that is less than the price actually paid? Did they explain possible tax saving mechanisms? Do you know what must be done to finalize the transfer? Did you discuss the possible options for taking title to the property? Did you discuss inclusion of succession language? These are merely a few of the more obvious considerations that come to mind when one chooses an attorney in a different country.
Choosing an Agent Typical Transactions [Choosing a Mexican Attorney] Ejido Property