Did you know that the role of the closing attorney has revolutionized real estate transactions in Puerto Vallarta since 1990?
Increasingly, this specialist has bridged important gaps for buyers, sellers, and brokers, ensuring a smooth closing process without legal issues or lapses that disrupt the delicate legal chain of title transfer.
For someone considering purchasing a property in Puerto Vallarta and its surrounding areas, the term “closing attorney” frequently comes up in conversation.
What exactly do they do?
And why are they so important?
In this article, we’ll reveal everything you need to know about this professional and how it can mean the difference between a successful purchase or a difficult experience for the buyer, saving two extremely important resources: time and money.
What is a Closing Attorney and why do you need one?
A closing attorney is a legal professional who focuses exclusively on the sale and purchase of real estate.
Unlike general attorneys who handle criminal or family law cases, these professionals concentrate their expertise solely on the real estate purchase or sale process.
The closing attorney was created in response to a specific need that arose in the Puerto Vallarta real estate market.
Twenty years ago, the closing process could take several months without knowing exactly where your file was going or even if it would get there. One reason was the general burden of notary offices, and two because of the unique nature of a purchase in a federal zone, which requires foreigners and the establishment of a trust, which makes the process a little more complicated.
Today, these specialists assure that:
- Every day, after your offer is accepted, everything will be handled openly and efficiently until the closing day arrives. What’s more, in the offer itself, you and your agent (if you’re the buyer) will designate your closing attorney in writing.
- Their focus is on accompanying you throughout the entire closing process, from the moment an offer is accepted to the signing before the Notary Public.
- This includes, but is not limited to, reviewing documents, coordinating with escrow banks, preparing draft deeds, and all the important details, all while constantly communicating with you to keep you informed of any progress or changes. Remember what we mentioned about escrow in the Federal Zone.
The difference between working with a closing attorney and handling the process directly with a notary is like the difference between having an expert guide up an unknown mountain and venturing out on your own.
The attorney knows every detail of the terrain and can anticipate obstacles before they become problems, but above all, they know each other, the people, and the notary involved, which is why everything flows so smoothly.
The Closing Attorney’s Responsibilities
When you hire an attorney to close a real estate transaction, this professional formally assumes certain specific and well-defined responsibilities.
It’s important to understand what is within their control and what external factors can affect the outcome.
Among the closing attorney’s primary responsibilities is to thoroughly review the documentation.
This includes ensuring that the seller actually owns the property, requesting certificates of freedom from liens, and assessing the property’s assessed value so you can calculate your property transfer taxes.
The attorney is also responsible for preparing the first draft of your deed, the technical document that forms the basis for the final deed.
This draft contains all the details of the transaction and is sent to the notary for review and final approval. They assist with calculating the ISR (income tax) if requested (together with the notary; they cannot calculate it alone).
Review the minutes of a condominium property with the agent to see if there are any future expenses you should consider when purchasing. However, some things are not within their jurisdiction.
The attorney does not set the selling price, agent commissions, or the specific terms of the offer.
They also do not handle property inspections or deciding which escrow agent to use, but they can assist you with these activities.
This is also vitally important when purchasing a pre-sale, as they will review the developer’s information in detail upon request.
Your Closing Procedure:
Why it’s important to have a good relationship with notaries
Not all notaries in Puerto Vallarta will work with a closing attorney, and how this works depends largely on what both parties have agreed to.
Some notaries refuse to collaborate with attorneys and prefer to handle everything themselves.
Others embrace this collaborative model.
Notaries who regularly work with closing attorneys have a greater ability to pay attention and more practical experience handling transactions.
This is because the attorney handles some of the prerequisite work behind the scenes, allowing the notary to focus exclusively on the final legal aspects at hand.
When choosing a closing attorney, it’s essential to ensure that the notary has signed working agreements with them and has a reasonable likelihood of returning your trust.
This information will help you better plan your process and also prevent last-minute surprises.
Buyers may be happy with a particular notary based on previous experience, and this in itself isn’t a bad thing.
Good understanding between the closing attorney and the notary.
What? No!
This is fundamental and essential, as a closing attorney can only work if the notary agrees to work with them, not the other way around.
Maintain the closing deadlines established in your offer and keep communication open.
A practical attorney can recognize when to apply pressure and coordinate schedules between you to ensure your signing appointment is kept on time.
To avoid this, choose a specialized attorney who can provide you with constant updates and be your direct contact for any questions you may have.
Costs and Fees:
What you really pay.
The most common concern is that hiring a closing attorney will significantly increase costs.
However, the reality is that an honest and transparent attorney will not artificially inflate closing costs.
In Puerto Vallarta, closing costs can range from 2.5% to 5.6% of the property’s value, depending on the location and the specifics of any given transaction.
In Puerto Vallarta, this cost is based on the property’s tax value, while in Banderas Bay, it is based on the greater of that and the market value.
An ethical closing attorney discloses all costs in detail and can explain each item.
They will not quote extremely low prices (below 2%) or excessively high prices (above 7%) without some underlying risk, so if you find yourself in this type of situation, it is best to seek legal advice elsewhere.
Generally, the buyer selects the closing attorney, whose fees are included in the closing costs.
But sometimes, the seller may hire their own closing attorney when specific tax advice is needed or when they don’t really trust the buyer’s representative.
When a seller hires legal services, fees are calculated based on the specific work needed.
If they only need a quick review of some documents, the price may be relatively inexpensive or even free.
If they require comprehensive tax advice and changes to their tax situation, then the fees reflect the complexity of their work.
How to Choose the Best Closing Attorney
There is currently no official list of closing attorneys in Mexico, so the profession is not fully regulated.
This makes selecting the right professional even more important and requires more work on your part, although it is based on the knowledge and experience of the real estate agent and the agency you are working with.
Reputation and referrals are the most reliable indicators of good quality.
A successful closing attorney builds a clientele primarily through word-of-mouth referrals from satisfied real estate agents and buyers.
Look for individuals with at least five years of specific experience in real estate transactions.
Although there is no specific certification for closing attorneys, they should be licensed attorneys with a good understanding of real estate and tax laws.
Being effective is key.
Each step of the process should be explained by your closing attorney in easy-to-understand terms, and they should maintain open lines of communication between them and you.
Be wary of professionals who evade questions or are reserved when providing updates.
You should also look for an attorney who is capable of handling complex situations.
Real estate transactions can present all sorts of difficulties, from escrow bank issues to tax complications.
A good closing attorney will have navigated through these obstacles.
Networking with previous clients is a must.
Frequently Asked Questions
What should I do if I have my own closing attorney or should I use one suggested by a broker/agent?
You have the right to have your own closing attorney, and the final decision rests with you.
Your agent may recommend one based on experience, but it’s up to you to choose.
It’s also critical that the attorney you choose works with your desired notary.
What if my property type is new to my closing attorney?
Each property type (houses, condos, land, trust properties) has its own unique characteristics.
Make sure your attorney has experience handling transactions similar to yours.
Don’t hesitate to ask about previous similar cases.
How long does a closing process usually take?
The typical length of a closing process is between 30 and 90 days; the escrow bank, the complexity of document issuance, and your notary’s workflow will largely determine this.
Your attorney should establish a realistic timeline on your behalf from the beginning.
What documents should I present to my closing attorney?
Basic documents should include government-issued identification, proof of income (if applicable), bank statements, and any specific documentation required by the custodian bank.
Your attorney will provide you with a detailed list.
Can I request an updated report again?
Yes, you can change your closing attorney.
The process may take time and incur additional expenses.
For best results, it’s best to start as you intend to continue.
If you decide to change, make sure the new attorney has access to all the documentation already handled.
Conclusion: The Peace of Mind of a Secure Purchase
Hiring a competent closing attorney is one of the most important decisions you’ll face during your purchase in Puerto Vallarta.
This professional not only streamlines the technical closing process but will also allow you to sleep soundly, knowing your investment is in good hands.
Investing in a property isn’t just about money; it’s your assets, your home, and your future.
This is not a time to look for cheap advice. An experienced closing attorney can save you time, money, and, most importantly, frustration.
Remember that accountability and transparency are the foundations of a good closing attorney. It helps to find businesspeople with a solid track record of success who work with accredited notaries.
This is also important. But by communicating throughout the process, they work to keep everything clear and free of misunderstandings. Your dream of owning a property in Puerto Vallarta seems within reach, finally.
With the right closing attorney, your dream can become a reality safely and efficiently.
Such a crucial choice is the difference between a successful experience that will also benefit you in future deals, and something problematic and fraught with difficulties.