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Infonavit Act: What You Ought to Know About Reform

The changes will create new markets and change the way different sectors work.

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October
19, 2020

5 min read

This article has been translated from our Spanish edition using AI technologies. Errors can occur due to this process.

This story originally appeared on Alto Nivel

By Antonio Sandoval

This weekend Morena's lawmakers assured the Chamber of Deputies that they will try to get a permit in the fast lane, i.e. quickly, the legislative changes of the Institute of the National Housing Fund for Employees (Infonavit) , sent a few weeks ago by the owner of the executive branch.

If authorized, significant changes will be made to the way Infonavit works. Two transcendental changes in particular have caused some confusion as the full text of the reform proposals is not known. With the data we have, however, some of the big changes can be expected and how this will affect or benefit Mexican workers.

The two most important changes

1. From triangulation to "inverse triangulation"

Previously, a worker would choose the house or apartment to buy and initiate a series of proceedings, either with the construction company, a real estate agency, or directly between individuals. After the series of legal requirements were met, Infonavit paid on behalf of the worker it was sold to in order to give ownership to the new owner.

The worker bought his house or apartment but in fact he never had the money in his possession, he was only aware of his debts and his obligation to Infonavit to pay.

With the new law, all kinds of mediators have ended in this matter. In some cases, the legal requirements are retained and expanded. However, Infonavit will no longer pay any company or person the resources derived from the operation . As soon as the credit is authorized, Infonavit pays in the approved amount of the loan directly to the employee's and employee's bank account In return, you can freely choose the house he or someone else wanted.

It's still a bit confusing because if the employee has already made a commitment to a real estate agency or real estate company, then they are supposedly obliged to pay. That is, in order for Infonavit to lend the resources, there must already be at least one document supporting the employee's purchase. Otherwise, some analysts fear revolves around the possibility of the beneficiary spending money on other things.

Since the reform is planned, the change essentially consists of a kind of "inverse triangulation". That is, instead of Infonavit paying the builder on behalf of the worker, it gives the worker the money and he has to pay the builder, supposedly the rest doesn't change or doesn't change much.

2. Before only house or apartment, today land and self-construction:

This is perhaps the most relevant change in the federal government's proposal, a really big, big change.

So far, the loans granted by Infonavit have only been used to buy houses and / or apartments; they are limited to the purchase of apartments and units that have already been built.

This is, of course, a constraint on the expansion of other markets and the needs of the workers and even their tastes. The change provides that these loans can also be used to purchase land . However, it is very important to note that there are specifications for what type of country, location, and features and services. The foregoing destroys any expectation that has been generated that it will be possible to buy anywhere, which it will not. In addition to buying land, The Infonavit credit can also be used to build apartments on the acquired property or on any other property belonging to the employee.

Other customizations include the ability to pay for a home loan with the Infonavit loan and purchase a second loan after the first is paid off. The changes could be approved shortly as expressed by the legislature . This will certainly mean a different way of working in some sectors, such as construction, which now not only have to find the customer but also have to compete with more quality. A market is also opening up for the sale of land financed with loans from Infonavit, which previously practically did not exist.

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