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Don’t Wait Until It’s Too Late? Have you ever wondered what happens if you should suddenly pass away and your property is held in a Mexican corporation? Well …
Don’t Wait Until It’s Too Late?
Have you ever wondered what happens if you should suddenly pass away and your property is held in a Mexican corporation? Well it’s not pretty.
Unfortunately in the last 4 months, I’ve had 2 clients suddenly pass away; one from a sudden illness, and the other by suicide. Neither of them had a Mexican will.
This will create serious problems for their surviving heirs, and cause the process to drag on for some time. The widowed spouse of one of my clients now wants to sell her property, but without a Mexican will, that she won’t be able to for a long time. Despite the fact that her name is listed as shareholder in the Mexican corporation that holds the property, without a will it doesn’t mean all that much.
In a way it’s not all that different than not having a will in the U.S. or Canada. It greatly complicates the process and generally results in added time and cost before things are settled and assets are disbursed to the appropriate heirs. And as we all know the courts and attorneys reap the benefits that rightfully belong to the heirs.
So, given the complexity of not having a will in the U.S. or Canada, think about the complexity of not having one in Mexico. You know what the bureaucracy is like in Mexico. Do you think it’s going to be any easier? In reality it’s going to be much more complicated, time consuming and expensive. But you can protect yourself and make your life or those of your heirs much simpler and less expensive by having a well drafted and legal will that is enforceable upon death.
When Should You Have a Will?
The simple answer is whenever you have physical assets in Mexico that you want to bequeath to your heirs in the event of your death. I am writing this from the perspective of bequeathing real estate but if you have other tangible assets in Mexico, those could be included as well.
For real estate located in Mexico that is owned through a Mexican corporation, a Mexican will makes perfect sense and in my opinion is essential. Property held in a fidecomiso, the alternate way for foreigners to own property, does not require a will. The reason is that the trustees, who are in effect the owners, indicate as part of forming the trust, those that are to succeed them. So in effect the fidecomiso acts as a kind of will for the purpose of bequeathing real estate, but you should discuss this with an attorney. In all other cases – including the corporation – foreigners really need to have a will in order to avoid complications.
In addition to the benefits mentioned above, another significant advantage to having a will is the avoidance of having to comply with international law. Under normal circumstances, in order for international transactions to be legal, documents need to be translated into the accepting country’s language, in this case, Spanish. In addition, other legal actions and procedures are required by both countries, all requiring time and money. You may recall that when you set up your corporation that you had to have your documents apostilled by the Secretary of State’s office in your state or province in order to legitimize and legalize the transaction. That was relatively simple, but wills require much more bureaucracy and expense by both countries administering them. The will, in essence replaces all of this bureaucracy. Also, don’t make the mistake of thinking that your U.S or Canadian will can be enforced in Mexico. Many people assume this, but you may find it’s far more difficult and costly to try to enforce this will than to create a separate Mexican will to deal with your Mexican assets.
The will is executed before a Mexican Notario. As a result, the document is considered legal and binding for purposes of Mexican law and upon passing of the testator, can be executed with assets disbursed in a relatively efficient timeframe. Under normal circumstances this can take place in three to four months. Without a will, the process of passing your assets on to your heirs can take at least one year and possibly more depending on the complexity. Take the simple and less costly option and have a will prepared. Don’t leave your heirs with a mess on their hands after you’re gone.
The process of creating a will in Mexico is relatively simple. You simply need to specify what you want your will to say, including primarily, who is to inherit your assets upon your passing. Keep it simple. The more complicated you make it, the more costly it will be. The attorneys can help in preparing a simple will which is included in the costs shown below. Under Mexican law three witnesses and two translators are required for a will to be valid. These can be provided by the attorney unless you specify someone else.
Unlike wills in the U.S. or Canada, you may be surprised that the cost of having a will created in Mexico is relatively inexpensive. I have arranged a price for my clients who are interested in having a will prepared. I’ve selected a highly respected attorney in Merida who has prepared many wills over his long career. He has agreed to offer my clients the following prices for preparing a simple will:
Will (executed in Merida) $400
Will (executed outside of Merida) $550
The difference in cost is due to travel expenses incurred while traveling from Merida to an alternate destination. These prices are available only to my clients or subscribers to my newsletter.
Why wait? It’s obvious that we won’t live forever. You may be thinking that you’re planning on selling your property long before you go, but noone knows what tomorrow will bring. For $400 you can greatly simplify things for your heirs and avoid their having to deal with a foreign culture and bureaucracy that they may be totally unfamiliar with. Why not make it easier on them?
If you’re interested in pursuing a will further, contact me directly and I’ll put you in touch with the attorney. At that point you don’t need me and you can deal with him directly unless you have further questions.