Purchasing a pre-sale condo can have many benefits for the buyer. You will most likely receive a discount on the sale, there are more choices of which suite you will purchase, and some developers will allow you to modify the suite. Maybe you prefer a different color or added storage, different countertops, even structural changes. In Mexico, there are many excellent real estate developers with wonderful reputations for getting their building completed on time but what if there are hold ups or financial issues?
There are many things you need to confirm before you purchase a pre-sale home. Some questions to ask the developer. Who is the developer? What other projects do they have in town, what is their history? Does the developer have a clear title for the land? Are the buyer’s deposits held in an escrow company?
Ideally the deposit is kept in the escrow company until the project is delivered or as agreed by the builder’s lawyer and the buyer’s lawyer.
Ensure it is documented in the contract when the construction will start and what will happen if things do not start on time.
As we all know things may not be finished on time. Include the delivery date in your contract.
If the project time runs late, is there any compensation? Are you able to back out with the full deposit?
In some cases, people have sold their previous home and have to wait to move into the new one. What if it is not ready for months, or you have arrangements to rent it out? Is there a refund of the costs you will incur during this time?
If you move in, and the promised amenities are not finished, for instance, the swimming pool or laundry area is there any compensation?
There is nothing illegal about using the buyers deposits to finance the project in Mexico. However, for your own protection make sure you have a lawyer to draw up the agreement in case there is a problem finishing the development.