Buying or selling a boat in Mexico can be a great way to get a luxury vessel at a fraction of the US price. With its miles of beautiful coastline and vibrant boating culture, Mexico is a paradise for boat lovers. However, there are important legal considerations and paperwork requirements that must be handled properly when buying or selling a boat there.

This article will provide an overview of the process of buying and selling boats in Mexico, including:

• The legality of buying and selling boats in Mexico
• Saving on sales tax through an “offshore” sale
• Required paperwork needed to finalize a boat sale
• Finding and working with a legitimate Mexican boat broker
• Conducting a private sale yourself
• Inspecting boats before purchase
• Negotiating a fair price
• Legally registering the boat in Mexico

By following the guidelines here, you can ensure your boat purchase or sale in Mexico goes smoothly while staying compliant with Mexican law. Let’s start by examining the legality of buying and selling boats in Mexico.

Legality of Buying and Selling Boats in Mexico

Mexico has fairly straightforward laws regarding foreign boat ownership and requirements for registration. Some key things to know:

• Foreigners are allowed to purchase and own boats in Mexico. There are no restrictions against non-citizens buying, selling, or registering boats with the Mexican government.
• All motorized boats in Mexico must be registered with the Mexican government. This applies to boats that will be kept in Mexico full-time as well as boats that will be visiting Mexican waters temporarily.
• Boat registration must be completed at a Customs Office (Aduana) in Mexico, at a Mexican consulate in the United States (up to six months prior to the date of entry into national territory), or can be applied for online at  www.gob.mx/banjercito. You’ll need to provide proof of ownership and pay a registration fee to Banjercito.
• The registration process results in obtaining a Temporary Import Permit, which allows the boat to legally operate in Mexico for up to 10 years before renewal is required. One additional renewal for another 10 years is allowed upon expiry of the first permit.
• A boat can only have one active Temporary Import Permit at a time.
• Boat registration and permits must be completed within 30 days of the boat’s arrival in Mexico. Significant fines can apply for non-compliance.
• Boat registration requirements apply equally to Mexican and foreign-owned boats. The laws make no distinction based on the buyer’s citizenship.

This provides context for the legal temporary importation of boats into Mexico. But how about their sale while carrying a Temporary Import Permit? Mexican law states that boats in Mexico and registered under a Temporary Import Permit are not permitted to be sold / have their ownership changed while the permit is active. For a legal sale to take place, one of two actions must be taken:

• A change of status must be made from temporary to permanent importation or, where appropriate, if the permanence period has already expired, the respective regularization must be carried out with a Mexican customs authority; or, 
• The vessel must vacate Mexican waters and cancel it’s Temporary Import Permit, by which it is now outside of Mexican jurisdiction. Whether the same vessel returns to Mexico under the same or different ownership/flag, it is treated as a new vessel and would follow the previously outlined steps for temporary importation if the vessel is to be operated in Mexican waters.

So in summary, foreign-owned boats are common and legal in Mexico with proper registration. The process is straightforward for both Mexicans and non-citizens. To sell a boat, the conveyance for this occurrence is documented by Mexican authorities on how this may occur without violation of national laws.

Saving on Sales Tax with an Offshore Boat Sale

One way to potentially avoid paying sales tax on a boat purchase in Mexico is to conduct an “offshore” sale. This involves having the seller transfer ownership of the boat offshore, outside of Mexican waters. The advantage of an offshore sale is that it may allow the buyer to avoid paying Mexico’s 16% sales tax on boats and/or violating natural Mexican law prohibiting the sale of a vessel that has been temporarily imported into the country.

While this seems like an attractive proposal, there are some important caveats to keep in mind:

• The legality of offshore sales for tax avoidance purposes is questionable. While commonly done, it exists in a legal grey area that some would consider a loophole, and does not prevent a vessel from being subject to the importation tax laws of the country to which the vessel is flagged when it returns to home waters.
• For Mexican-flagged vessels, there is no guarantee that Mexican authorities will not attempt to collect sales tax later, if they believe tax was evaded. 
• Transferring ownership offshore can be logistically complicated, potentially involving extra fees, added time to the sale process, and additional paperwork.
• For the seller, an offshore sale means no sales tax collected, which may require special accounting treatment.
• Morally, some may view offshore sales as unethical tax evasion, denying funding for public services in Mexico.

To summarize, offshore boat sales potentially offer major tax savings in Mexico and/or desirability to foreign-flagged boats looking to sell in a more desireable market. But, these sales potentially come with legal and ethical risks and complications. Each party will have to evaluate if the benefits outweigh the drawbacks for their situation. Expert legal and tax advice is recommended when considering this approach.

Required Paperwork

When buying or selling a boat in Mexico, there are several important documents you’ll need to have in order. The most critical is the boat’s title (also called the “Matricula” in Mexico). The title proves ownership and allows you to register the boat in your name.

Make sure to only buy boats that have a valid Mexican title. Some sellers may try to pass off a US Coast Guard registration as proof of ownership – don’t fall for this! The boat needs a proper Mexican title issued by the harbor master’s office.

When transferring ownership, the buyer and seller must sign and date the title to record the sale. The new owner then has 30 days to register the boat in their name with the local harbor master’s office. This involves submitting the signed title, a copy of your passport, and paying a small registration fee.

If there are any existing liens on the boat, you’ll need a release of lien document from the lender. Never buy a boat that still has active liens, as you could be responsible for repaying the seller’s debts.

Other useful paperwork includes the most recent registration form, proof of payment of the Annual Tax (Impuesto Annual), and a Temporary Import Permit if the boat was brought into Mexico from another country.

Having all the right documentation in order will make the buying or selling process smoother and prevent any issues claiming legal ownership. Don’t finalize a sale until you’ve verified the title and other paperwork.

Finding a Broker

When buying or selling a boat in Mexico, you may want to consider working with a broker. Here are some of the pros and cons:

Pros of Using a Broker

• Knowledge and experience with boat transactions. A broker will understand all the steps involved and can guide you through the process.
• Access to listings. Brokers have access to boats listed for sale that aren’t advertised publicly.
• Negotiation assistance. An experienced broker can help negotiate the price and terms of the deal on your behalf.
• Paperwork handling. The broker can help with compiling the necessary paperwork and documentation.
• Advertising. Brokers have connections for marketing boats for sale more widely.

Cons of Using a Broker

• Cost. Brokers charge a commission fee, usually 10-15% of the sale price. This cuts into your proceeds if selling.
• Variable reliability. Some brokers are more ethical and competent than others.
• Potential conflicts. A broker may have divided loyalties between you and the other party.

Finding a Reputable Broker

If you decide to use a broker, do your due diligence to find one who is reliable and trustworthy:

• Ask around for referrals and recommendations from recent clients.
• Check reviews and complaints registered with consumer protection agencies.
• Look for longevity in business and membership in professional associations.
• Interview brokers to ask about their experience, services offered, and commission rates.
• Verify necessary licenses and credentials.
• Require a written brokerage agreement detailing services and fees.

Taking the time to find an ethical, knowledgeable broker can make the process of buying or selling a boat in Mexico much smoother. But weigh the costs versus benefits carefully.

Conducting a Private Sale

One option for buying or selling a boat in Mexico is to conduct a private sale between individuals. This avoids broker fees but requires more effort on the part of the buyer and seller. Here are some tips for conducting a private boat sale in Mexico:

Advertise the Boat for Sale

• Post the boat on online classifieds sites popular in Mexico like Segundamano, Vivanuncios, or Facebook Marketplace. Include details like make, model, year, length, engine, and asking price.
• List the boat for sale on boating forums and websites frequented by Mexican boaters. For example, post on cruiser forums like Cruisers Forum and Latitude 38.
• Create flyers with photos and details and post them at nearby marinas, yacht clubs, and boat ramps.
• Spread the word among other boaters in your marina or sailing community. Word of mouth can be effective.

Prepare the Boat for Showings

• Thoroughly clean the boat inside and out to make a good first impression.
• Have all mechanical equipment and electronics in working order for showings.
• Gather documentation like registration, ownership paperwork, maintenance records, and instruction manuals.
• Stage the interior so it looks spacious and homey. Remove clutter and pack away unnecessary items.

Screen Potential Buyers

• When respondents make contact, ask qualifying questions to gauge seriousness.
• Request to see a copy of their boating license. Pre-qualify their ability to afford the boat.
• Offer test drives only after screening buyers carefully. Accompany buyers on sea trials.
• Conduct negotiations in person when possible. Be wary of buyers who seem evasive or only want to communicate remotely.

Let me know if you would like me to expand on any part of this section!

Inspecting the Boat

When buying a used boat in Mexico, it is essential to thoroughly inspect it yourself first, and also hire an independent marine surveyor to identify any issues or needed repairs. Here are some key things to look for when inspecting a boat you may want to purchase:

• Carefully check the hull, deck, and superstructure for any cracks, leaks, or signs of damage or deterioration. Tap on the hull to listen for delamination. Inspect below deck for soft spots or spongy areas. Look for discoloration from past leaks.
• Examine the engine and systems. Have a marine mechanic look at the engines and generators, check compression and do a sea trial. Turn on electronics, lights, pumps and appliances to ensure they are working.
• Look over all steering, controls, winches, sails, fittings and hardware. Make sure sails aren’t too worn and sheets/lines are in good condition. Verify that steering and control systems are operating smoothly.
• Consider hiring a professional boat inspector or surveyor, especially for larger or more complex boats. They will thoroughly inspect all systems and condition, checking for moisture, corrosion, pests, and identifying necessary repairs.
• Require a sea trial to check performance and handling underway. Have the seller demonstrate all systems and equipment. Listen and feel for any vibrations or noises that could indicate underlying issues.
• Examine all safety equipment like fire extinguishers, flares, life jackets. Make sure all required gear is onboard and up to date.

Thoroughly going over the boat yourself and hiring a professional survey can help identify significant issues and give you room to negotiate on price if repairs are needed. Don’t skip this critical step when buying a used boat in Mexico.

Negotiating the Deal

When negotiating the purchase price of a boat in Mexico, there are some important tips to keep in mind:

• Research the current market value. Look at comparable boats that have recently sold to get a sense of the fair asking price. Resources like Soldboats.com can provide sale prices for the same make/model boat.
• Make an opening offer 10-20% below asking price. There is usually room to negotiate down from the initial asking price. Start low, but with a reasonable offer based on your research.
• Expect counteroffers. Sellers will likely come back with a counteroffer that is closer to their ideal sale price. Be prepared to negotiate up or down in increments until you reach an agreement.
• Avoid getting emotional. Negotiating can sometimes feel personal. Try to keep emotions out of it and focus on the facts and figures to get the best deal.
• Get all terms in writing. Once you agree on price, make sure all terms like closing date, title transfer, any repairs, etc. are documented in the purchase agreement.
• Inspect the boat before finalizing. Don’t remove contingencies until you have paid for a survey and sea trial and are satisfied with the boat’s condition.
• Be ready to walk away. If you reach an impasse, be willing to walk away from the deal. That may bring the seller back with a better offer.

With patience and preparation, you can negotiate a fair price and favorable terms to buy a boat in Mexico. Using typical offer/counteroffer strategies and following tips like researching prices, making strategic initial offers, and focusing on facts over emotions can lead to success.

Closing the Sale

The closing process for a boat sale in Mexico is similar to how it works in other countries. Here are the key steps:

• Finalizing paperwork – All the paperwork like the bill of sale, registration, and title transfer paperwork needs to be completed. As the buyer, make sure the title is transferred to your name. Review all documents carefully before signing.
• Transferring funds – The buyer needs to transfer the agreed sale price to the seller. This is usually done via wire transfer or bank check. For a large purchase like a boat, a wire transfer is recommended for security reasons.
• Closing process – Many buyers and sellers handle the closing on their own. However, you can hire an escrow service. They will collect and distribute money and paperwork on your behalf. Using an escrow service adds a layer of protection for both parties.
• Take ownership – Once funds are transferred and paperwork complete, the buyer takes ownership of the boat. Make sure to receive keys, manuals, and all accessories that were promised as part of the sale.
• Registration – The buyer will need to register the boat in their name. This involves filing paperwork and paying fees to the port captain’s office. They will issue new boat registration documentation in the buyer’s name.

Closing the deal is usually quick and straightforward in Mexico. However, it’s important for buyers and sellers to be thorough with paperwork and follow protocols to ensure a smooth transaction. Having an agent or broker can help guide you through the closing process.

Registering the Boat in Mexico

Once you’ve closed on the boat sale, you’ll need to officially register the boat in Mexico. This involves getting the proper registration and permitting from local port authorities.

The process will vary slightly depending on where in Mexico you register the boat. But in general you’ll need to bring the following documents to your local port captain’s office:

• Original boat title or bill of sale showing transfer of ownership
• Passport copies for all owners
• Temporary import permit for the boat (obtained when you brought the boat into Mexico)

The port authorities will review your paperwork and issue a new title and registration under the Mexican flag. This serves as official proof that you own the boat and it’s properly registered in Mexico.

You’ll also need to get any licenses or permits required for the boat size and intended use. For example, boats over 10 meters typically need a Mexican fishing license.

The cost for registering and permitting a boat in Mexico is reasonable, usually $100-300 depending on the port and boat details.

Once your Mexican boat registration is complete, make sure to display the official registration numbers and flag stickers as required. This will make it easier to prove ownership if ever questioned by the port police.

Registering your boat properly in Mexico is crucial to owning it legally and safely enjoying Mexican waters. Take the time to get all the right paperwork from the port captain to avoid any issues.

Footnotes

http://omawww.sat.gob.mx/aduanas/vehiculos/importacion_temporal/Paginas/embarcaciones_preguntas.aspx