When you are looking at buying or selling property; or, you just want to gain some general knowledge in real estate, there are many terms that are widely used terms in the industry that is like a language of its own. The terms are not difficult to grasp, yet, there is a greater possibility of error if words are misheard and misused. Here are a few basic terms and their definitions that are often misunderstood by the consumer and or seller:MLS- Multiple Listing Service: A type of association that assembles, collects, and issues data in relation to various properties that are recorded for sale by its associates, who are real estate brokers. This type of membership is not attainable to the community. However, there are chosen MLS information may be sold as listings to real estate websites. There is not a sole MLS covering the whole US.PITI- Principle, interest, taxes, and insurance: These are the four main components to a monthly mortgage payment. The remaining balance is known as the principal, which reduces the amount owed. The fees that are charged by mortgage companies for obtaining a loan is called the interest. You pay taxes and insurance into an escrow account every month for property taxes and mortgage and hazard insurance. Appreciation- This is an increase of property value; due to changes in market conditions, inflation, and several other factors.CMA- Comparative Market Analysis: This is report that provides prices of different properties that are in comparison to a particular property and those that are recently sold, that is on the market or were previously on the market, but was not sold within the listing period. Closing Costs: These are the various costs that are settled between the buyer and seller when the agreement is finished. These expenses include mortgage related fees, escrow or attorney fees, recording fees, title insurance, brokerage commission and others charges. Closing costs are commonly collected via escrow.Contingency: Contingency is considered a stipulation of an agreement that prevent it from legally binding until certain criteria is made. A common stipulation is a buyer right to demand a professional home inspection before acquiring the property.Title Insurance: Title insurance is a special policy that safeguards the interest of a lender or owner involving real property from various forms of false or unforeseen claims. It’s considered customary for a consumer to pay the loaners title insurance policy.Concessions: These are advantages or allowances that are given by the seller or landlord of a home to aid in the closing of a sale or a lease. Common concessions contain absorption or moving expenditures, space remodeling or improvements, and reduced payment for the initial duration of the lease.Sale- Leaseback: A sale-leaseback is a type of agreement that an owner offers a property to an investor, who afterward leases the property back to the initial owner under arranged terms. Sale-Leaseback contracts offer the initial owner freed up capital and tax breaks while the investor receives a guaranteed profit and appreciation.

Did you know that real estate licensing in Mexico is not mandatory? That anyone can sell real estate without having to go through training specific to the field?  There just recently became available a program to obtain a Mexico real estate professional degree and license but again, this is not mandatory.  Yes, unfortunately this is all true. So how can you, as a consumer, protect yourself in such an unregulated market?

Even though the field is not yet regulated, there is an association that was established to ensure good business ethics among its members. This association is called A.M.P.I (The Mexican Association of Real Estate Professionals) A.M.P.I. National was founded in 1956  in Mexico City with the intention to raise the technical level of the profession and establish codes of ethical business practice. This group is diligently pursuing the matter of licensing as well as ongoing training requirements for the real estate field.

This group has been striving towards a higher level of professionalism and has been recognized by NAR (National Association of Realtors) in the USA. Because of their high standards of ethics, A.M.P.I. members are now recognized as NAR International Affiliate Members. A.M.P.I. is also a member of ICREA (International Consortium of Real Estate Association) an alliance of leading national real estate organizations in the world’s major marketplaces.

The constant pursuit for professionalism in the real estate field, has led to the development of courses that members can now take and one day such courses will be a requirement to receive the real estate license. For example, this year in the Cancun real estate region, the A.M.P.I. organization will sponsor a six day course for C.I.P.S (Certified International Property Specialist) as part of the ongoing training for members.

As professional Mexico brokers and agents in the market place, we get to see first hand some of the questionable practices of unprofessional independent or “part time” brokers and it is frightening to see the risk unsuspecting consumers are exposed to. Many foreign consumers are unaware that the real estate profession is not regulated. You should always investigate the background of a broker before entrusting them with your business. Beware, some brokers may use the A.M.P.I. logo without being a member of the association. Some may even use the REALTOR logo if they were a licensed broker in the US, but they may not be a member of A.M.P.I. Selling real estate in the U.S. is very different from here in Mexico, so being a REALTOR is not really of great benefit for the consumer.

In hot real estate markets in Mexico, such as Cancun and the Riviera Maya, it is common to find waiters, taxi drivers, etc. moonlighting in real estate to try their luck at making a hefty real estate commission. These part timers may not have bad intentions but their lack of experience could result in a costly mistake for you.

There are still some horror stories from buyers of pre-construction developments throughout Mexico. In many of these situations, the buyer bought directly from the developer. Many consumers think that if they buy direct and avoid a broker, they will get a bigger discount. Unfortunately, that is not the case. There is always a commission paid. If there is no broker, then the commission is paid to the in-house sales staff that works directly for the developer and represent his interests.  Without your broker, there is no one looking out for your interests. It is especially important in the current market to always have a knowledgeable broker, one who can recommend developments that are safe for investment. There are so many new pre-construction Mexico condo projects on the market which creates the possibility that some of them will not complete construction. Your broker will know the factors that are important in determining the risk involved based on the developers track record, marketability of the project, guarantees to the buyer and market conditions that affect sales.

Since the boom of foreign buyers in the last few years, professional brokers have realized that the way to do business is by transparent transactions. Many have realized that we have to adjust the Mexico purchasing process to one that the foreign buyer understands and gives them the greatest protection.

It is unfortunate for both buyers and professional brokers, that many brokers in Mexico still have not adopted transparent business practices. This not only puts the consumer at risk but stories of fraud and deception always come back to haunt the real estate field. Thankfully, A.M.P.I. continues to push forward to find ways to better protect and educate consumers to ensure the safety of their investments.

There are fewer fraudulent sales every year, but they still happen. Buying real estate is one of the biggest investments you will ever make. To make sure you are working with an A.M.P.I. professional go to http://www.ampi.org/  Don’t be afraid to ask for references and do check them.

A real estate agent learned a lesson about trying to sell someone a beautiful, affordable home, with stairs leading up to two bedrooms, a bathroom, and a spacious loft with a built-in book shelf. Although, the young couple was very happy and in a state of emotion when viewing this home, and after having viewed less desirable homes, at least not the desires they wanted, they soon made a mistake that they would regret, after making an accepted offer, completing the legal forms, and moving into the two story home.

Things were great in the beginning. So many plans they had for the interior and exterior. Gardens were planted, furniture put in, and arranged to desirable locations and positioning. Color schemes fit in well. It was a charming home, and even the real estate agent sold it to them as charming, because in fact, it was considered charming, and the couple admitted that as well. After being cooped up in a townhouse, with noisy neighbors, this home was meant for them, and they knew it. They completed all the legal forms, as fast as they could so they could get into this home, their home.

About a year into living in the home, the couple started complaining about the nuisance of going up and down the stairs. They used the stairwell for decorations, hanging treasured pictures, and as a beautifully dressed feature of the home, but it was just getting to be a burden. Having children, a pet, and climbing up and down to clean, pick up things, and take furniture down, and up as necessity required, it was just too much for them. They had a 30 year, fixed rate mortgage, big mortgage payments, but relatively speaking, and affordable home. The stairs had to go.

There is something about the attractiveness of stairs upon which many people are fixed. Stairs are not even the top five home features that buyers have to have in a home. Buyers sign their real estate forms to get into a home with an open floor plan, plenty of light, big, walk-in-closets, a spacious kitchen with quality appliances, and a two-car garage. Nobody really wants stairs, or do they? In a state of buyer emotion, seeing the stairs, they become enchanted and inspired, and want to buy that lovely home with stairs.

It would be useful for the agent showing the home to an anxious, and emotional couple, is to list the desires, needs, and abilities. The couple has desires in a home, needs, that are the absolutes that a home must have, and an ability level, which could be financial, or physical. There could be a medical condition that would make having stairs an impediment. Having stairs is often beautiful, and gives a smaller home a sense of bigness, but for a working couple, with both spouses going to work everyday, coming home to stairs to climb up and down, can become a burden in time. That is what this couple found out, and in a market in which they knew it would be a challenge to sell, if not impossible to sell for a profit to get a one story home. They decided to stay it out, and deal with the stairs. The upstairs office, study, was moved into the master bedroom.