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Relying on the listing broker for independent advice. There is an inherent conflict in dual agency (which exists when the listing broker or his sales people deal directly with a buyer).
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Making a down payment directly to the listing broker or the owner.
The bank account of the listing broker, even if it is in the U.S., is not a trust account or an escrow account.
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Relying on the title policy without a careful analysis of what title risks are covered. It is great that title insurance is now available, but many people don’t bother to understand the coverage.
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Having the deed reflect a price lower than the real purchase price.
This will cause you to pay much higher Mexican capital gains (Impuesto Sobre la Renta) when you sell the property.
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Not correctly manifesting full costs of construction or remodeling, and keeping formal receipts (facturas) of all deductible costs, to use to reduce your capital gains tax when you sell.
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Thinking that by obtaining an FM3, you can avoid capital gains tax even though the property is not really your primary residence.
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Not protecting yourself through competent representation. In Mexico, real estate brokers and salespersons do not have to take a test, do not need a real estate license, and are not subject to any meaningful disciplinary system in cases of negligence, misconduct, or conflict of interest (such as the conflicts of interest that arise from dual agency).
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Not understanding land use regulations and the conditions of your trust and of your immigration status. You will be fine if you understand the rules and abide by them. Mexico wants you to invest in real estate, and has made it easier by making favorable changes in the law, such as NAFTA in 1994.
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Postponing an evaluation of tax consequences until you eventually sell, instead of when you buy.
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Assuming that the Notario Publico will take care of everything.
Notarios in Mexico are lawyers and hold a very responsible position. However, the Notario is not representing you in the transaction.
