Hola Joe,

Please remember that my piece was focused on the wild land near the end of the peninsula, adjacent to La Bufadora and its famed blowhole. That area is still blissfully separated from the nearby populations in the poblados of Punta Banda, Esteban Cantu and the outskirts of the Ensenada further east.

I am, however, sadly familiar with the debacle that occurred out on the Punta Banda Estero spit over a decade ago when dozens of American and Canadian residents were rousted from their homes by unscrupulous individuals, whose names I know but will not share here, who deliberately misled the victims of the scam into thinking that they had some sort of legal title to the properties where they resided. The then used their legitimate title and the existing Mexican legal system to unfairly evict the poor folks irrespective of how much they had invested.

Although this horrific event got an inordinate amount of press coverage in southern California that continues to cloud our region to this day and devastated the lives of many foreign residents that were either retired or getting to retire, it did prompt the Mexican government to create a legal vehicle, the Fido Comiso.

This is actually a bank trust, in which a certified Mexican bank acts as trustee and hold the title for the foreign resident in question. Since all Fido Comiso’s require that all of the property’s title and ownership documentation be verified prior to its acceptance, it offers a rock solid vehicle for foreigners living in Mexico to enjoy virtually all of the rights associated with outright ownership. The Fido Comiso can also be inherited by a pre designated heir.

Additionally, foreign corporations can now be legally formed in Mexico without a partner who is a Mexican citizen. This offers a great opportunity to have your company’s name on the actual title, but it is an option that is only available to those who are truly operating a business.

In regard to leasing land, Mexican law now only allows leases to run 10 years in length; not less, not more. Remember, all contracts in Mexico must be written in Spanish to be valid. Using a reputable real estate attorney in Tijuana or Ensenada is also highly advised. Just as it is north of the border, caveat emptor is a phrase that is essential to remember when purchasing anything.

Thanks for your very valid comments, I hope that my response clarifies the range and limitations of the ethereal microscope that I employed when originally writing the piece. ~ Tom

Hi Guys, I really enjoyed the article and, as always, found it to be well written and most informative.
I wasn't here for the situation that several Americans and Canadians found themselves in but have talked to some of them. I have also talked to the heads of the Ejido and to some of the people that won the legal battle over rights to the land. From what I understand from both is that the Ejido felt that the land belonged to the Ejido and was available for sale. However, since there was a lawsuit going on, they made that clear to the prospective buyers. The buyers were aware that there was a cloud on the title to the land. In this case, a fideicomiso (land trust) would have done nothing to protect the prospective buyers. by the way, fideicomisos were not started because of this situation. They have been around for a very long time and were available then. I also understand that some of the buyers went to the winners of the lawsuit and came to a new agreement in which they leased the land and kept their homes. Others listened to their lawyer who urged them to go as far as taking their lawsuit to the Mexican Supreme Court. There the only winner was that lawyer. It is truly a shame that such a situation arose in this area with stunning beauty. As you know, Tom, I bought a couple of lots from the Ejido. However, under similar circumstances as met the ex-pats so many years ago, I would not have even considered such a purchase had I ascertained there to be a cloud on the two lots. Rather, as a holder of dual citizenship I was and am able to own land in Mexico. However, I still did my due diligence by going to the State's land office to verify that the person I was dealing with was the true owner of the land, by hiring an attorney to handle the wording of the sales contract and by going to a Notario (has nothing in common with a US based notary but acts much like a title company) and made certain that there were no claims against the two lots and that the sale was registered both locally and nationally. I would do this in the US as well by going to a reputable realtor and insisting on a title search and title insurance.
I hate that some people were removed from property they felt was truly and legally theirs, but also feel that they failed in doing their due diligence. PS As you know, my background is in international banking, real estate and mortgage lending. I'll tell you of some of the situations I ran into in the US as well. Land fraud is not just here. It was and, probably is, north of us as well.