Hardly a week goes by without a newspaper article in any California city reporting on a real estate scam or fraud, or buyers suing developers or general contractors for shoddy workmanship. Reports also tell us of real estate agents misrepresenting or absconding with deposits or other breaches of conduct. All this as the state of California has some of the nation’s strictest real estate and consumer protection laws, all backed up by active policing and enforcement programs along with sympathetic courts.

Yet the vast majority of real estate transactions are free of problems and satisfaction is the norm, particularly for those who have done their homework, researched the market and familiarized themselves with the process.

So why is it that so many Americans, San Diegans included, cross the border into Baja California without taking the necessary time and precautions they are advised to take in their own back yard in the purchase of a residence?

One reason seems to be that most buyers already know of someone who has purchased a home in Baja and had no troubles. And this is true. Of the more than 200,000 Americans owning property through a bank trust in Baja, less than 1 percent had problems. Add to this the understandable satisfaction with the relative bargain prices of Baja real estate near the beach.

But saying “no problems” as a universal word can be misleading. Most mean no problem with title to property, since the presence of U.S. title insurance firms offering coverage is quickly making those issues a thing of the past. Today, most buyers will not consider buying in a subdivision where title insurance is not offered, or one where the two U.S. title insurance companies most active in Baja refuse to write policies.

Title insurance is not a cure-all. It does not cover things such as delivery of product, quality of construction, promised amenities or on-site common improvements. These items are particularly important when purchasing prior to construction, and often depend on the reputation of the developer.

A recent case in point: An American developer, a longtime Mexico resident, subdivided several acres of coastal land on the southern fringes of Tijuana and sold the lots to buyers who were to build their own homes. The subdivision called for streets, sidewalks, water drainage, landscaping and other common area amenities. Buyers bought the lots with title insurance protection, and most have built their home. But the on-site improvements are not completed after two years. What now?

In the same development, in a few homes built closest to the ocean the Mexican contractor miscalculated and built part of some patios infringing on federal tidal land (50 meters from high tide). Such property belongs to the nation and is not for sale. Using such land requires a special permit, which most often is arduous and expensive to obtain. Those owners now have two choices: remove the encroaching portion of patio and restore the land to its original condition, or apply for the permit. Who decides? Who pays?

The above illustrates the importance of both doing homework and becoming familiar with the process. If buying a finished product, homework and investigation of the developer is a must. If not buying a finished product, more homework and research is required.

In 1994, with the cooperation of Tijuana’s then-Mayor Hector Osuna Jaime and Director of the Planning Department, Diego Moreno Maldonado (today in the same post with the Rosarito Municipality) and sponsored by San Diego’s Rick Engineering, I wrote the first English language Baja real estate manual. It was titled “Real Estate Development in Tijuana, Baja California: Permit Process for Zoning, Subdivisions and Construction.” In 12 years, numerous additions have been made to the process, but the basics are still the same.

Developers must first submit a master plan showing detailed engineering drawings of the lot sizes, public streets, sidewalks, parking, drainage, sewer, water, electrical grid and compliance with green belts. This process is called the “Anteproyecto,” literally translated to “Prior to Project,” another way of saying zoning and subdivision. Permits for land use and from each of the utility companies or agencies must be applied for and obtained. In turn, each of the agencies must assure the service is available. And for private developments with a homeowners association, the CC&Rs must be submitted for approval.

Typically the Anteproyecto is officially approved once the mayor and other municipal officials sign off and the project is published in the “Diario Oficial del Estado de Baja California,” the state’s official gazette.

Some developers opt to wait for the official publication until they pull building permits. However, those who are selling lots or get the master plan to increase the value of the property so they can sell with a master plan, still should publish for official approval.

So here again, buyers should not be shy about asking to see the Anteproyecto permits as this will detail the developer’s obligations as to property improvements. Similarly, ask to see the construction permits.

If the developer is selling prior to construction, be sure and have the title company you will be dealing with hold the escrow funds. Make sure there are very precise instructions as to the stages of completion upon which the deposited funds will be released to the developer. The instruction also can include a certification of materials used as agreed to be provided to the escrow holder.

But the best advice is, choose the right developer — be sure of credentials and reputation. And the good news is that there are a good number of good ones.

Patrick Osio Jr. can be reached at posiojr@sandiegometro.com. The veteran consultant also has issued The Mexican Perspective, an intensive primer on business culture and protocol. Copies are available at http://www.hispanicvista.com/sales/book_sale.htm.