You want to buy a lot in Pescadero or Cerritos and build the home you’ve been imagining. The vision is clear, but the path to funding, permitting, and construction can feel confusing, especially across borders. You can move forward with confidence once you understand how due diligence, approvals, and financing come together here in Baja California Sur. This guide walks you through a practical sequence so you protect your investment and keep your build on schedule. Let’s dive in.
Your financing path in Pescadero–Cerritos
Financing a land purchase and new construction in the Pescadero–Cerritos area follows a predictable rhythm. You begin with rigorous due diligence on the lot, confirm permit feasibility, choose the right funding route, then align your lender’s draw schedule with your contractor’s milestones. Each step builds certainty for the next.
Start with essential due diligence
Before you put money at risk, verify clear title and legal capacity to sell. Ask your real estate attorney and a notario público to confirm the escritura pública, the ficha registral, and a certificado de libertad de gravamen to check for liens, mortgages, or attachments. Confirm predial (property tax) is current, and hire a licensed surveyor to provide a topographic survey and boundaries. This early work reduces surprises and positions you for lender review later.
Verify utilities, water, and access
In coastal Baja, water and power drive timelines and budgets. Confirm how you will source water through municipal lines, a permitted well, trucked supply, or desalination, and whether wastewater will be septic or a treatment unit. Check CFE access for electricity and any need for a transformer upgrade. Document legal access to the lot and any easements so your lender and notario can clear closing conditions.
Know the land type and coastal band
Distinguish between private titled land and ejido land. Buying ejido land that is not fully regularized carries severe legal risk. If your lot is near dunes or beachfront, identify any federal coastal zone considerations and setbacks that could limit your building footprint. These questions influence design, permits, and lender confidence.
Permits that unlock financing
Lenders want to see that you can legally build what you plan. The right municipal and, when required, federal approvals are the foundation for funding.
Municipal approvals you will need
Request a uso de suelo certificate from the Ayuntamiento de La Paz to confirm allowable use, density, height, and setbacks. Prepare architectural plans signed by a licensed architect and structural calculations from a civil or structural engineer. With these, apply for the licencia de construcción, which is the primary building permit. Keep tax receipts and proof of ownership ready because they are commonly requested.
Environmental and federal reviews
If your project impacts the coastal zone or protected areas, you may need environmental authorization from SEMARNAT or a formal impact statement. Coordinate early for water connection permits or well permits through the Comisión Estatal del Agua or CONAGUA. For electrical service, plan your CFE application and timing to align with construction phases. Coastal projects that touch the federal zone require additional coordination with relevant federal offices.
Timelines to plan for
Expect several weeks to 1 to 2 months for preliminary feasibility and uso de suelo, then 2 to 6 months for the full building permit review. Federal environmental processes can add months depending on scope. Utility connections can also take weeks or months. Build these windows into your financing plan so you avoid idle crews or rushed decisions.
Financing options that work here
You have several ways to fund land and construction in Pescadero–Cerritos. Your best route depends on your residency, credit profile, equity, and tolerance for timing and documentation.
Cash and private capital
Cash is common for lot purchases and even full builds because it simplifies closing and avoids lender timelines. Private or mezzanine financing from investors or developers is also common for bridge needs. Expect higher rates and customized terms in return for speed and flexibility.
Mexican bank and construction loans
Some Mexican banks offer construction or mortgage loans that can work with coastal properties held in a fideicomiso for foreign buyers. Banks typically require larger down payments and strict documentation, such as Mexican tax IDs, income verification, and approved plans. Many lenders will not release significant funds until you hold an active building permit and a signed contractor agreement.
Cross-border lenders
Specialized cross-border lenders sometimes fund Baja projects for U.S. and Canadian clients. Terms vary. Verify how they secure collateral on a fideicomiso and how they run inspections and draws. You want alignment on documentation and disbursement before you break ground.
Seller financing and bridge options
Some sellers will finance a portion of the lot purchase or early construction, using promissory notes or staged payments. Ask your attorney and notario to review any seller financing terms, especially how and when liens are recorded, and how those interact with any future bank or private financing.
How construction draws work
Construction funding is typically released in stages tied to milestones. This protects you and the lender while keeping the contractor supplied with working capital.
What lenders require before the first draw
Most lenders request a package that includes:
- Proof of land title or valid fideicomiso documents
- Approved architectural and structural plans
- An active licencia de construcción
- A signed contractor agreement with a schedule of values
- A detailed budget, construction schedule, and insurance certificates
- An independent inspection or architect certification of progress for each draw
A sample draw schedule
Your exact schedule will depend on scope, but many projects follow a pattern similar to this:
- Permitting and site work: 10 to 15 percent
- Foundation and slab or piles: 15 to 25 percent
- Structure and roof: 20 to 30 percent
- Rough-ins for electrical, plumbing, HVAC: 15 to 20 percent
- Finishes and fixtures: 15 to 30 percent
- Punch list and contingency: 5 to 10 percent
Each draw is usually backed by an inspection report and lien releases from the contractor and subs where applicable. Funds are often managed in an escrow or restricted account and released after documentation is verified.
Who to hire and when
Building the right team early keeps your financing plan credible and your budget aligned with reality.
Early pre-offer team
Engage a real estate attorney to review title and confirm the land is private and free of liens. Consult a notario público on closing costs and registry steps. Hire a surveyor to verify boundaries and a local architect for site feasibility. If your lot is coastal, ask a permit consultant to check environmental and coastal considerations with the municipality.
Contract to closing
Negotiate a due diligence period and escrow with the seller so you can complete verifications. If you are a foreign buyer, begin your fideicomiso application with a trustee bank. Consider whether seller financing terms could support your purchase or early soft costs.
Pre-construction to ground-breaking
Direct your architect and engineers to finalize plans and calculations. Submit for uso de suelo and the building permit. Apply for water and power connections or for well permits. Bid the project and select a contractor with a clear contract that defines milestones, payment triggers, retention, and change-order procedures. Align your lender on the draw schedule, inspection process, and documentation.
During construction
Use independent inspections for each draw and require the contractor to provide receipts and lien releases where appropriate. Keep permits posted and current. Track weather windows and lock down long-lead items early to avoid delays.
Completion and handover
Schedule final municipal inspections and obtain the completion certificate if applicable. If your loan converts from construction to permanent financing, complete that process with your lender. Register improvements if required and update predial to reflect the completed structure.
Budgeting, risks, and local realities
Pescadero–Cerritos rewards careful planning. Coastal conditions and logistics can add cost, but a thoughtful approach protects your timeline and your capital.
Common pitfalls to avoid
- Skipping title checks or buying unregularized ejido land
- Assuming water is available without permits or capacity
- Underestimating permit timelines and seasonal slowdowns
- Paying ahead of verified progress or without lien releases
- Funding without a 10 to 20 percent contingency for coastal builds
Coastal construction realities
Sandy soils, salt exposure, and wind shape design choices. A geotechnical report guides foundation type and elevation. Materials may come from La Paz or Cabo San Lucas and can require longer lead times. Hurricane season runs roughly June through November, so plan to weatherproof the building envelope before peak storms.
Insurance, fees, and closing costs
Budget for builder’s risk and contractor liability insurance. Expect notary fees, registry costs, and state transfer taxes at closing. If you use a fideicomiso, plan for setup and annual trustee fees. Include municipal permit fees and professional costs for architects, engineers, surveys, soils, and permit facilitation.
A simple action plan
- Week 1 to 2: Engage attorney, notario, architect, and surveyor. Begin title and land-use checks.
- Week 3 to 6: Confirm utilities, water strategy, and environmental flags. Decide financing route.
- Month 2 to 4: Finalize plans and submit for permits. Line up contractor bids and builder’s insurance.
- Month 3 to 6+: Close on land once title is clear, permits are on track, and your lender is aligned on draw mechanics.
- Month 6+: Break ground once you hold the building permit, a signed contract, and an agreed draw schedule.
Ready to move from concept to construction with a plan that stands up to lender and municipal scrutiny? Schedule a private consultation with Apex Real Estate Los Cabos for local guidance, introductions to the right professionals, and a financing path tailored to your build.
FAQs
What should I verify before making an offer on land in Pescadero?
- Confirm clean title, check for liens, verify private land vs ejido, review zoning, confirm access and utilities, and order a topographic survey and soils assessment.
Do I need a fideicomiso as a foreign buyer near Todos Santos?
- If the property is within the restricted zone near the coast, you will typically hold title through a bank trust called a fideicomiso that can also serve as loan collateral.
Which permits do lenders usually require before funding construction?
- Expect to provide uso de suelo, an active building permit, approved plans and structural calculations, a signed contractor agreement, a budget and schedule, and proof of insurance.
How long do permits take in the La Paz municipality?
- Preliminary land-use checks can take weeks to a couple of months, while full building permits often run 2 to 6 months, with environmental reviews adding more time if required.
How are construction draws structured for Baja builds?
- Funds are released in stages tied to verified milestones, typically after inspections and lien releases, using a budgeted schedule of values managed through escrow or a restricted account.
What are common water solutions for Cerritos and Pescadero builds?
- Many projects use cisterns with trucked water, permitted wells when feasible, or small-scale desalination, along with septic or modular treatment for wastewater.
What contingency should I carry for a coastal build?
- Plan for a 10 to 20 percent contingency to cover coastal conditions, logistics, and potential weather-related delays.
