Literally the minute Ben and I got to Mexico, we wanted to have a car. Of course, Ubers and taxis are here in Merida but we just like to have our freedom. Buying a used car in Mexico as a foreigner is possible but it’s not like India where we lived prior, and we could just pay someone $600 cash for a beat up old car and drive off with the car (no worries about paperwork!).
Buying a Used Car in Mexico as a Foreigner
Here is what we found out straight away about buying a used car in Mexico: the only ones you’re going to find for $1000 and under are mostly the old beat up VW bugs you see everywhere. I’m not knocking it – I want one! I plan to buy a white one as a second car down the line just for fun. It reminds me of my Omni van in India! Used cars here are priced the same as the USA for the most part and you can use Kelley Blue Book to see what prices should be. If you want something in good condition and only 5 years old you’re looking at around $3,500-8,000 USD depending on what type of car you want.
The next thing that is important is that you can rock up and buy a car on a tourist visa, no problem… you can even get insurance to drive as a tourist without issue BUT you can’t register the car to your name until you have residency here, either temporary or permanent. You cannot even register the car while your temporary is pending.
Luckily, when you buy a used car in Mexico, the plates are usually good for a year so there is no rush to register the car in your name. You could, if you want to, buy the car right away and then go through the residency process, then once you’re a resident and have your little plastic card, you can register the car to your name. OR you can just rent until you’re a resident if you don’t like the idea of waiting to register.
99% of people I speak to say that you cannot get a car in Mexico in your name unless you are a resident, but I did read once that you can apply at the INM for the “CURP” number as a tourist, and get the car in your name. Others state they tried this and it failed. You could give it a go! Since I am getting residency, I didn’t do this, but if I were a tourist, I would certainly try it.
Now, if you buy a car as a tourist because you’re here just under 6 months and don’t get it registered to your name because the owner has the plates good for a year, that’s no problem but you will have issues selling it legally. So you might just eat that cost or try to have the previous owner help you re-sell it.
A note on renting in Mexico:
We rented through ACE / MEX Rent A Car and paid just $17/month turning down all the insurance they offer since my Chase Sapphire Reserve covers me in full. Most expats here will tell you that if you get in an accident you aren’t really covered and will go to jail because you don’t have Mexican liability insurance. You won’t because you get that insurance when you book. When you rent through Expedia, or whoever, it will say very clearly “750,000 MXN Mexican liability coverage included”. When you go to pick up the car, and they say you need to buy this, just show them that. They might lie, as they did to me, and say the legal limit is now 1,000,000 MXN, but they are lying and it’s not so just tell them you know the rules and it’s 750,000 MXN. Technically, all rental cars in Mexico are legally meant to come with this liability.
So, your credit card if you have insurance will cover your CDW (collision damage waiver). For your card to cover you, you have to TURN DOWN all insurance the rental place offers, or your card insurance is null and void. Simply ask your bank for a letter stating this, and stating you are covered, and for how much, and then show that to the rental office.
With the letter, we were fine and got the .47 cent a day rental. BUT they, of course, can just tell you to eff off if they don’t understand the situation or are mean. We found that to be true at Hertz, who told us that we had to buy insurance or couldn’t take the car. So, we left and booked on ACE. We did ACE/Mex Rent A Car three times now without issue in Merida near the airport.
Just know, they will try everything to get you to take the insurance. Friends who rent in Cancun never have this problem as they see more American tourists with credit cards like these and are used to looking at the letter and declining all insurance.
Okay, so moving on to buying a used car in Mexico as a foreigner…
The first thing you need to do is think about if you’re going to get residency here or not. You will need it to register the car in your name. If you don’t register it in your name, you could ask a trustworthy Mexican friend to register it in their name and you just get insurance as a driver. I’m told by my attorney this could mean if there was an accident, and you were reimbursed, that money would go to the person the car was registered to – so they do need to be someone you trust.
Ideally, you should just get residency here. If you are buying a car it’s likely you love Mexico and live here and residency isn’t too much of a hassle. I have a WHOLE post on it you can read about here which goes step by step into the process.
We started looking at cars on second-hand websites like:
You can also go buy from a dealership, but we figured those prices would be higher. You could test your luck, though! I think you’d get a little bit more security that way since they are meant to have already vetted the cars. We did look at some but there was usually only one car in our budget in each lot, and it was crap. Our budget was no more than 140,000 MXN or around $7,000.
We sent messages through those platforms and only about 5% of them got replies. This is mostly because they don’t remember to de-list cars that have sold. When people do call, you’ll likely forget which car they are calling about (as you’ll message a million) and they’ll likely speak only Spanish making the whole thing more confusing.
We would simply say in Spanish we don’t speak it well and can we WhatsApp or SMS so we can use Google Translate. We’d set up a meeting place (the McDonald’s near our house cuz duh, I need a cheeseburger after such an excursion, or their house) and go look at the car. You CAN take the car to a mechanic here in Mexico and that’s kind of normal – everyone does it and the owner shouldn’t mind. They all brough their cars to meet us at the mechanic after we had seen it once and then wanted to know if it was god. Thanks GOODNESS we did as one car we really wanted was total crap and the mechanic was like “this is a terrible car”. It would have been a scam and honestly, we didn’t see that coming, the guy was so normal and seemed honest.
Don’t rush the process. There are THOUSANDS of cars online. You can also just see them parked on streets with numbers to call. Call if you see one you like! We budgeted around $5,000 and there are lots of good deals in that range but in the end, we wanted an SUV and upped our budget. You can up it to $7,000 and get a 5-year-old SUV or you could get a one-year-old Chevy Aveo. It’s so hard to decide.
Things to keep in mind are that you will want a car that is “common” since it’s used and might need repairs down the line. I know that’s boring, but it’s smart.
Buying the car, getting the title, registering it, and paying
Paperwork for buying a used car in Mexico:
Once you find the car you like, you need to make sure it has everything you need. First of all, don’t even bother looking at cars with plates outside of the state you are in (for us, Yucatan). It causes more of a headache, and although it’s possible we looked into this heavily as there was one we really liked and it’s just not worth the trouble.
So, once you find a car, get it checked by a mechanic, negotiate the price (based on what the mechanic says about the car), it’s time for the paperwork. You need to make sure the owner is the owner (aka it’s not stolen and the title is in their name), the plates are real, the VIN matches, taxes have been paid, there are no outstanding tickets, the “factura” is legit, and more. You can go to the SSP to get this checked out (the same place you can change over the registration.
We hired Yucatan Transitional Services to make sure it was all done right. We had immigration going on at the same time, a missing cat, and work. The guy we were buying from spoke only Spanish and was a little impatient about the sale, so we needed someone to help translating. It was SO WORTH it as we had issues getting the money and didn’t have time to check on paperwork. Erick from the YTS did the paperwork checks for us, talked with the owner so the owner had everything in order (a copy of his ID (signed), the original factura (aka title, signed), a letter that he no longer is responsible for the car that we both signed, and made sure to give us all the other paperwork he had for the car. Once you have the factura which is signed and the ID, you are good to go.
We actually used YTS mechanic they partner with to check our cars so we knew it was a trusted mechanic. It is 300 MXN to check out a car.
You can then take the car to the SSP to switch over to your name. The owner doesn’t have to go – although if you did your paperwork check there, you could check the paperwork, pay the owner, and switch it over right then. I can’t register it yet as I am not a resident yet (my last step of the process is still pending). But, I own the car and can go register my plates in a month or so. The plates are good on ours until 2019, and usually, when you get a car they are good until a year or so – you can keep using those plates and it’s not necessary to go register the car until they are expiring but I just want to because I just do!
Getting the money:
It’s not easy to get $7,000 in cash in Mexico as a foreigner that doesn’t have residency yet when you need it TODAY, lol. If you have some time, you can set up an account with Intercam bank who will let you even on a tourist visa, then you can transfer money supposedly without fees. We didn’t have time for that, so tried Western Union (the site was having tech problems, yippie).
Make sure to note that there are limits to how much you can pick up. Elektra limits pickups from 50,000 MXN per person per day. Others like Coopel allow only 25,000 MXN. Go just 2 pesos over, and you’re not getting that money. You’ll have to cancel the transaction which is a headache.
We ended up doing our max ATM withdraws on multiple cards each and asked him to wait a day for us to buy the car. We tried XOOM but that was a fail as they wanted to verify my identity and it would take 3-7 days (they are partners with PayPal and I had a horrible time with them, do not recommend). We then did worldremit which worked well but has a 25,000 MXN transfer limit, so we did 4 transactions through them to ourselves (2 to Ben and 2 to me). Two of them worked and the other two got held for verification, so we picked up 75,000 MXN that way at Elektra. Still short on day two, Western Union still wasn’t working and my WorldRemit account was blocked as was Ben’s, so my mom had to pull money from my bank in the USA, take the cash to Western Union and send it to us that way. It was just over the 25,000 MXN limit and we couldn’t go to Elektra again because they have a 50,000 MXN limit per person regardless of if it’s WU or Moneygram or whatever – so we went to Famsa bank that allowed 50,000 per person but didn’t know we were hitting up other places (lol, it was ridiculous) and got the remaining amount. Honestly, what a headache lol. My ATM card doesn’t charge fees thank goodness but all these transfer costs money and give bad exchange rates. Highly suggest getting a Mexican bank account set up ahead of time and transferring money in.
All in all, it was a hassle to get so much cash for us because we were unprepared and needed the car ASAP. Once you start looking for a car, go ahead and get the money so if you find one you can just buy it.
Getting Car Insurance in Mexico
Guess what? It’s not illegal to not have car insurance in Mexico. Can you believe that some people just don’t get it? Don’t be that person! I think it’s crazy. You can expect about 2,000 to 4,000 MXN for a used car per year as an insurance payment.
We went with SARCA insurance company who found us a policy – again, a partner of YTS that Erick helped us find. I did compare rates elsewhere and got some quotes from others that were recommended on Facebook, but theirs were the best + they gave us multiple quotes at once.
We met with Ricardo (firstname.lastname@example.org) after we chose the one we wanted and paid for it with a card at his office. It is done the same day you decide and takes just a minute then it’s live and you have your policy printed. Here, you ensure the car not the driver so now anyone can drive the car not just the policy owner.
So, next I just have to register the plates in my name once my residency goes through and that’s it!
Update: my residency went through and you can read how to become a resident in Mexico here.
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