New Mexico Foreclosure Laws

Under New Mexico foreclosure laws, lenders can foreclose a distressed property through judicial procedure. Typical foreclosure timeline is about 6 months.

Judicial Foreclosure Information

As a judicial foreclosure state, foreclosure laws in New Mexico does not contain a Power of Sale clause; hence, requires lenders to file for a complaint or lis pendens against the defaulted borrower. States that have non-judicial foreclosures allow borrowers to sign for a Power of Sale on the mortgage agreement. When this provision is present in the loan document, lenders are authorized to foreclose a property in the event that the borrower fails to meet the terms in the contract such as when the borrower defaults on payment.

To initiate a foreclosure, the lender has to issue a Notice of Default to the borrower or homeowner. The Notice states the intention of the lender to pursue a foreclosure on a distressed property. If the borrower does not provide payment, the lender may file complaint which is known as lis pendens against the person. At this point, the borrower is given 30 days to respond to the lawsuit. If the borrower fails to cure debt or respond to the lawsuit, the court may rule against the person. Before a foreclosure sale is scheduled, the borrower is given another chance to pay off debt to prevent foreclosure of the property. When the grace period expires and the lender still does not receive the payment, a foreclosure sale will be scheduled in no less than 30 days after the court ruling. To stop the foreclosure proceedings, the borrower has to pay off debt. And borrowers can do so at any time up until the date of the foreclosure sale.

New Mexico foreclosure allows statutory right of redemption. Borrowers can exercise their rights to redeem a property that has been foreclosed. To reclaim ownership of a property, the borrower has to provide a full payment of the unpaid loan plus any additional costs or interest. This should be done within 9 months after the sale.

For low income sale, lenders may claim for deficiency judgment. This provision is allowed only in cases where a property in question is sold for less than the amount of the mortgage loan. This would mean that the borrower has to pay for the difference between the amount of the property sold for at foreclosure sale and the amount of the original loan.

Foreclosure sale resembles that of a public auction where the highest bidder is awarded with property ownership. Result of the auction will be confirmed by the court. The opening bid must be at least 80% of the property’s market value.

Notice Of Sale New Mexico

Notice of Sale should be published weekly in a local newspaper for at least 4 successive weeks up to the public auction.