A Prescient Senator Frank Church, 1975

Robert:

[America’s intelligence gathering] capability at any time could be turned around on the American people and no American would have any privacy left. Such is the capability to monitor everything: telephone conversations, telegrams, it doesn’t matter. There would be no place to hide.

If this government ever became a tyrant, if a dictator ever took charge in this country, the technological capacity that the intelligence community has given the government could enable it to impose total tyranny, and there would be no way to fight back because the most careful effort to combine together in resistance to the government, no matter how privately it was done, is within the reach of the government to know. Such is the capability of this technology.

I don’t want to see this country ever go across the bridge. I know the capacity that is there to make tyranny total in America, and we must see to it that [the NSA] and all agencies that possess this technology operate within the law and under proper supervision so that we never cross over that abyss. That is the abyss from which there is no return.

Senator Frank Church on Meet The Press, 17 August 1975

Previously Palmless Ave Las Palmas Gets Palmed!

Robert:

I'm admittedly stretching for the ironic aspect...there were already a few old palms on mostly barren Avenida Las Palmas...that's the street that runs from the Oxxo on the highway near Farmacia Guadalajara, down the hill to the Hotel Decameron.

It's a cobblestoned, wide, divided street, with good bay views as you descend, but the city had done almost nothing with the center median. But, all things happen here poco a poco (little by little), and suddenly, as I was driving by this morning on the way to work, I see new plants, and a continuous row of frail little coco palm saplings, one after another, freshly planted.

The good news is, these will grow very fast in this climate (if they take hold), and in just a few years, we'll have a stately row of tall palms down that median, and the street will finally live up to its name.

Here's a quick peek:

Emily Dickinson on Yelp?

Robert:

Novelist and journalist Neal Pollack has put together some tweets on how great poets might sound on crowd-sourced review site Yelp.
 
My favorite:
 

"Because I could not stop for Death, he kindly stopped for me. He charged me $70. I'll definitely use him again."--Emily Dickinson on Yelp.

I revere Emily's work, and that is from a lovely poem. But that tweet cracks me up. I suppose I have an odd sense of humor.

Another:

 "Round the decay of that colossal wreck, boundless and bare, the lone and level sands stretch far away. Not worth the $." --Shelley on Yelp.

Percy Bysshe Shelley, 1819

That's from another great, classic poem that almost everyone read in high school or college; Ozymandias.


Another:

  "I have eaten the plums that were in the icebox; I was starving and the room service here sucks." -- William Carlos Williams on Yelp

William Carlos Williams Passport photo, 1921

I'm opinionated about everything it seems. I know this "poem," and for me, it is not poetry. It was intended to be a starkly modern sliver of unadorned life. Nothing wrong with that. But it does not, for me, function on any other level, or have any subtle counterpoint. It pretends to evoke sublime substance through a starkly banal style.  Hemingway could do just that, even in extended prose. His plain and direct prose has a hypnotically lovely undertone and rhythm that is deeply poetic and evocative almost beyond comprehension. For me, that's what Carlos Williams was trying for, but fails to achieve, even in a short poem. So there.

If you disagree, feel free to tell me I'm an idiot and why. It's probably nothing I haven't heard before.

World's Safest Banks?

Robert:

A company called Global Finance rates the 50 safest banks in the world every year. For 2012, Canada's safest is TD Bank Group, coming in at number 11. The safest US bank is Bank of New York Mellon at a humble number 29.

To see most of the ratings CLICK HERE.

To skip ahead to see the world's number one safest bank, CLICK HERE. And notice that the country that has the number one safest bank has three other banks (a total of four) in the top ten. Wow. And the best the USA can do is number 29? Pitiful.

You might notice that big bully dogs like Goldman Sachs and JP Morgan do not appear. Of course to be fair they are a different type of "bank." They are "investment banks," also known as casinos. And yes, the odds are always heavily with "the house."

Another Critter Visits The Office. This One Has Wings.

Robert:

This looks to me like a moth and not a butterfly. But I'm no expert.

The word commonly used in Spanish is the same for both: mariposa.

My online Spanish-English dictionary says that technically the word for moth is polilla. But my secretary Lily had never heard that word. She said for 99% of  Mexicans, it's just the familar "mariposa."

Driving to Valle Banderas Yesterday; Raccoons, Foxes and Deer.

Robert:

I was driving the 10 kms from Bucerias to the county seat (municipalidad) in Valle Banderas yesterday in the afternoon. It's a beautiful stretch of country road...with dramatic mountains off to the left and ahead of you all the way. These are part of the Sierra Madre, and this particular peak rises to about 7,000 feet.

The lower slopes are covered in dense, dramatic tropical forest. Higher up, it changes to oak and pine forest. The only access to the higher elevations is horseback or on foot. It's dramatic country.

There are lots of deer (venado), raccoons (mapaches), squirrels (ardillas), and foxes (zorros), etc. Deeper into the Sierras there are jaguars, but I have not seen one in this immediate area.

Wall St. Maniacs Running the Financial Asylum

Robert:

"I believe we have a crisis of values that is extremely deep, because the regulations and the legal structures need reform. But I meet a lot of these people on Wall Street on a regular basis right now. I'm going to put it very bluntly. I regard the moral environment as pathological. And I'm talking about the human interactions that I have. I've not seen anything like this, not felt it so palpably. 

These people are out to make billions of dollars, and [think] nothing should stop them from that. They have no responsibility to pay taxes, they have no responsibility to their clients, they have no responsibility to people [or] counterparties in transactions. 

They are tough, greedy, aggressive, and feel absolutely out of control, in a quite literal sense. And they have gamed the system to a remarkable extent and they have a docile president, a docile White House and a docile regulatory system that absolutely can't find its voice. It's terrified of these companies.

If you look at the campaign contributions, which I happened to do yesterday for another purpose, the financial markets are the number one campaign contributors in the U.S. system now. We have a corrupt politics to the core, I'm afraid to say... both parties are up to their necks in this.

...But what it has led to is a sense of impunity that is really stunning, and you feel it on the individual level right now. And it's very very unhealthy. I have waited for four years, five years now, to see one figure on Wall Street speak in a moral language. 

And I've have not seen it once. And that is shocking to me. And if they won't, I've waited for a judge, for our president, for somebody, and it hasn't happened. And by the way it's not going to happen any time soon, it seems."

Jeffrey Sachs, Address By Video to a Conference At the Philadelphia Fed, April 2013

Never ask a man what...

Robert:

"Never ask a man what computer he uses. If it's an Apple, he will tell you. If it isn't, why embarrass him?"

Tom Clancy

Learning To Speak Spanish No Es Tan Facil! Pero Se Puede!

Robert:

I see it constantly. Americans and Canadians that move here filled with good intentions about learning to speak Spanish. They take a few classes in the first couple of years.

But, they hang out with mostly other gringos, with whom they always speak English. Pretty soon, they lose interest in their Spanish classes. "I wasn't getting anywhere." "It's too hard!" "I'm too old to learn this stuff!" 10 or 20 years go by, and they speak still only a few words of Spanish.

They have no idea, and will never know,  how many dimensions of this culture they are missing.

Yes, most people just give up. Why? Because learning a second language is hard. It's hard as hell. You must approach it with discipline and real determination. It is a tedious grind that takes years. Forget those absurdly silly language course come-ons that promise to have you speaking a foreign language "in 30 days!" That's ridiculous. It's ludicrous, fraudulent advertising, designed to separate you from your money and nothing more.

If you are motivated, disciplined and realistic, you can eventually get to real fluency. But along the way know that you will get dead tired. You will get bored. You will feel you aren't getting better. But in spite of all that, you must just keep on studying, and power through. You must. Or, it will never happen. But if you are one of the few who do keep at it, tirelessly, it will be worth it. And you can do it, have no doubt about that.

Check out the fine article below about the daunting process, but endless rewards, of learning a second language. The author is grappling with French, but no matter. The difficulties and frustrations are pretty much the same for students of Spanish. Or any language.

Learning A Second Language

Mexican Dog Wanders Into the Office.

Robert:

Mexicans are generally less territorial than gringos...mi casa es su casa isn't literally true, of course, but it is a sentiment that reflects a broader sense of communal sharing...and along those lines, Mexican dogs are often "neighborhood" dogs, in that they might have one "true owner," but are routinely petted and fed by people up and down their street. Consequently, they rarely bark and freak out when you walk by...they just wag their tales and smile (there are exceptions, of course), as if trying to charm a treat right out of your pocket.

Lily in her regulation dog-watching hat.

We've had several animals wander into the office this year...there was the big iguana that had to be herded back outside...with accompanying shrieks from Lily and Deborah...the video of that is like an I Love Lucy episode, and is in the blog archives.

Then there was the scared, affectionate kitten that came in and wouldn't leave. We could never find the owner, so that kitten is now one of three fat cats that live at my place. He's a happy camper, and all grown up now; went from trembling desperado to smugly entitled in about 30 cat-seconds.

Today, a large but very goofy-friendly dog suddenly wandered in the office..."Fili," according to his tags...

He just ambled around the office awhile, sniffing things out, wagging his tail. He seemed to be thinking, "Howdy folks...wutch y'all up to in here?"

He looked thirsty, so we gave him a bowl of water, which he lapped up.

Then, Fili decided to lie down for a short nap near Lily's desk...apparently a marble floor seems as inviting as a hammock to a dog...

But, after about 15 minutes he got his mojo back and wandered back out to the sidewalk, looking for hipper action than we could provide.

The Purchase and Closing Process, Revisited

This article ran in the February, 2013 PV Property Journal.

A STEP BY STEP GUIDE TO THE PURCHASE AND CLOSING PROCESS  FOR FOREIGNERS IN COASTAL MEXICO.

by

Robert Foster

You've been thinking for years about buying something here for investment and retirement. Dreaming about the good life is fun...and it's how all of us expatriates started our journeys that eventually brought us here.

But all such dreams eventually reach a tipping point; a point where they either become reality or not; where you either summon your courage and leap off the high board into the pool and actually, (oh my God!) make a purchase, or walk back to the ladder, climb down from the high-board, and stay away from the water.

The reason some people never take the plunge usually comes down to simple fear and anxiety. More specifically, fear of making a huge mistake, a financial and lifestyle belly-flop, and being laughed at by friends and family back home.

I made my first home purchase here almost 17 years ago, and I went through that insecurity phase. And sure enough, once I was under contract, well-meaning friends and family hit me with things like, "You did what? For heaven's sake Robert, why would you do that?"  Then they'd give me that sad, skeptical look and they'd say, "Well...I sure hope it works out. But I don't know...purchasing property in Mexico? That's downright morbid..."

Later on, visiting me in my Mexican home, sitting on my rooftop terrace, gazing at the mountains and the ocean, cold margarita in hand, they all had, shall we say...a slow but inevitable enlightenment. "You know, this really is nice. I have to admit it. I haven't felt this good in years! And how much did you say your property taxes are? What? That's all? You can't be serious!"

The best way to get control of your anxiety in any situation is through knowledge. If you're at that tipping point, and wanting to make an offer on a property, but just can't quite summon the courage, it might be helpful to know how the process will unfold. (All the following steps assume you're working with a professional, knowledgeable AMPI agency. AMPI stands for, in English, the Association of Mexican Real Estate Professionals. AMPI has stringent ethical and professional requirements, including ongoing annual education.)

Step 1. Negotiating the Purchase offer Agreement.

Your agent will submit your offer to the seller's agent, and there will usually be the standard negotiating phase, with offers and counter offers. In my office we prefer to use formal contracts for all phases, but some agencies just use informal "letters of intent." (We prefer to avoid that informal approach, as it allows either side to temporarily "fish for agreement" without being legally committed.)

In any case, once you reach agreement on price and details, you will then have a detailed, signed-around (fully executed) purchase offer contract, normally in both English and Spanish, stating precisely what is and is not included in the sale; precisely what the terms, if any, are; what international escrow company will be used; how much the deposit will be and when it must be in escrow; what the penalties to both sides are for non-compliance; what Notary will be used; and what the scheduled closing date is. FYI: The Spanish side of the contract takes legal precedence over the English side. The English side is there as a courtesy translation.

Step 2: Opening Escrow/Earnest Money Deposit

The contract will typically stipulate that you have, for example, 5 business days from date of seller's acceptance of your offer to open an international escrow account, and fund it by wire transfer with a 10% earnest money deposit. (The 5 business days and the 10% are negotiable, but are used in most cases.)

Your agent should immediately fill out the Escrow Agreement forms  (we use Fidelity), and send them to you to review and sign. The agent will send those forms along with a copy of the purchase offer contract and the IDs of buyer and seller to the escrow company. The escrow account number will then be issued and you will wire the deposit plus the escrow fee into the account. (Fidelity's escrow fee is $650 USD). So, if you purchased a $400,000 property, you would be wiring for example $40,000 USD deposit plus the escrow fee, or $40,650 USD. 

Step 3. Closing Costs Deposit

Concurrent with opening and funding escrow, or immediately after, your agent should obtain an itemized closing costs estimate from the Notario that will be handling your closing, and explain it to you point by point. Depending on the value of the transaction (the price you have agreed to pay for the property), your total closing costs including Notary's legal fees, trust permit, appraisals, 2% property transfer tax, and public registry fee, etc., should average around 5% of the purchase price. (You can save a bit if you elect to assume an existing trust rather than start with a new trust. A qualified agent should be able to explain the pros and cons of this option.)

For a million dollar plus home, the total closing costs will fall, as a percentage, and may be closer to 4%. On the other hand, for a very inexpensive property, such as a studio or a small lot, the closing costs can be, as a percentage of the price, more in the 6% or even 7% range.

Regardless, you will be instructed by your agent to make an immediate deposit of usually half the the closing costs to the Notario or attorney handling your closing. (Sometimes the closing costs deposit requested is less than half, but should never be more than half.) This deposit will typically be done by another wire transfer, into the specified closing costs account. Your agent will provide you with wire transfer instructions in all cases. Common sense dictates that you should always obtain a wire transfer receipt from your bank for any wire you send.

Step 4. Providing Documents to the Notary and the Bank.

On behalf of the Notary and the fiduciary trustee (the Mexican bank that will hold your trust),  your agent will begin asking you to provide scans of various documents needed for closing. You will need to provide a scan of a recent utility bill with your current name and address in Canada or the USA. You will also fill out substitute beneficiary forms indicating who will inherit the property in the event of your demise. Your agent will explain to you the various options for structuring this, but usually, your children will receive equal undivided interests in the property only upon the demise of all primary beneficiaries (you and your spouse in most cases).

There are some exceptions to this structure. If a husband and wife are making the purchase as co-primary beneficiaries but each have children by previous marriages, it can be set up to accommodate that situation. You will discuss this with your agent and the Notary and decide on the structure most suited to your situation. Regardless, the beauty is that having sub beneficiaries already written into your trust deed negates the need to draw up a Mexican will. It negates the need for Mexican probate.

You will also be providing Know Your Client forms, among others, to the fiduciary bank. Your agent will explain how these are to be filled out and signed. In some cases these can be signed at closing.

Step 5. Preliminary Disbursement Form/Closing.

Most closings occur about 6 weeks after the purchase offer contract has been signed-around. About a week before closing date, your agent should create an itemized, detailed preliminary version of the Escrow Disbursement Form. This will show every disbursement of funds related to the closing, and the net proceeds to the seller. This is circulated among all parties a week or so ahead of closing so that everyone can check it.

In almost all closings here, the seller pays the commissions. Those commissions will usually appear on the Disbursement Form, but are simply taken from the net proceeds to the seller. So they are as a practical matter paid by the seller, not by you, the buyer.

At the actual closing, a final version of the Disbursement Form is circulated for all to recheck and sign. Immediately after closing has taken place, meaning after the title has been properly transferred to you (as beneficiary) with no liens or encumbrances, this signed final Disbursement Form, plus a no lien certificate and a preliminary version of your new deed, are sent to the Escrow company for review, and only then are your funds disbursed to the seller and all involved.

The balance due on your closing costs (remember that you paid a deposit on the closing costs to get started) is collected at closing. You can pay it with cash, a personal check in CAD or USD, or from extra funds you previously had wired to the escrow account. If the latter option, it will of course appear as one of the items on the Disbursement Form.

Step 6. You Are Handed the Keys at Closing, and a Preliminary Copy of your Trust Deed. Go to Your New Place, Have a Margarita!

It would be nice to end this article on that upbeat note, but, unfortunately, there's a bit more work to be done.

Step 7.  Changing Utilities Into Your Name

Over the next few days, your agent will accompany you to the various utility companies (water, electric, phone, internet, cable or satellite TV, etc.) to assist you in getting the needed changes made.

FYI. It often happens that buyers cannot attend the closing, or cannot stay for a few days after closing to change utilties. If planned in advance, there are ways to deal with these situations.

If you are getting a new trust, the fiduciary bank signs for you. You don't have to attend. But it is still best if you can, to do a final walk through of the property, etc.

If you are saving a bit in closing costs by assuming the seller's existing trust, you either must attend the closing, or grant a Mexican limited power of attorney to your agent (or whomever you wish) to sign in your behalf. That power of attorney can in most cases also be used by your agent to change utilities into your name.

With several weeks advance notice, a Mexican limited power of attorney can be granted by you while you are in the USA or Canada. Your agent should be able to explain the different procedures for this, which vary depending upon whether you are Canadian or American.

Step 8. Your Final, Registered Trust Deed

At closing you will receive a preliminary copy of your trust deed. But the sale still has to be registered in the property tax office (catastro) and the public registry (Registro Publico). Due to the backlog of documents, this process takes on average from four to six months. When done, the Notary will notify you (or your agent in some cases if you so request) that your final, bound deed is ready. You can pick it up from the Notary the next time you visit this area, or (recommended) ask them to send it directly to you by FedEx, UPS or DHL.

No two deals are exactly alike, but the above steps are typical of the vast majority of transactions here on the coast, in which the purchaser is not a Mexican.


Robert Foster
Robert Foster y Asociados
163 Lazaro Cardenas, Bucerias, Nayarit
329 298 3314
Toll free from Canada or USA 01 866 210 1324
website: rfasoc.com
office blog: http://robertfosterasociados.blogspot.mx/

It's Showtime! (Bucerias Sunrise, August 2013)

Robert:

Taken a few mornings ago, from Bucerias, looking east, towards the Sierras. This is another reason so many of us like the summer thunderstorm season. All you have to do is go outside and look up...as often as not, "It's showtime, folks!"

Photo by Lori LaVelle