New Mexico Foreclosure Laws



How are mortgage liens treated in New Mexico?

New Mexico is known primarily as a lien theory state where the property acts as security for the underlying loan. The document that places the lien on the property is called a mortgage. It should be noted that New Mexico does have a non-judicial foreclosure process however this is rarely used by lenders in a residential context. Under the New Mexico “Deed of Trust Act” commercial mortgages of $500,000 or more, or those with specific language to benefit low-income households can be foreclosed using non-judicial means. Borrowers must explicitly consent to a deed of trust instrument.


How are New Mexico mortgages foreclosed?

In New Mexico, the lenders go to court in what is known as a judicial foreclosure proceeding where the court must issue a final judgment of foreclosure. The property is then sold as part of a publicly noticed sale. The court with jurisdiction over a foreclosure is known as the District Court in the county in which the property is located. A complaint is filed in this court along with what is known a lis pendens. A lis pendens is a recorded document that provides public notice that the property is being foreclosed upon.


What are the legal instruments that establish an New Mexico mortgage?

The documents are known as the mortgage, note, and in a commercial transaction, a security agreement. Sometimes the mortgage document is combined with the security agreement.  A mortgage is filed to evidence the underlying debt and terms of repayment, which is set forth in the note.


How long does it take to foreclose a property in New Mexico?

Depending on the court schedule, it usually takes approximately 120-180 days to effectuate an uncontested foreclosure. This process may be delayed if the borrower contests the action, seeks delays and adjournments of hearings, or files for bankruptcy. A notice foreclosure sale must be advertised at least four (4) weeks in advance of any sale and sales usually take four (4) months after final judgment for foreclosure is granted. The date of sale must be at least 30 days after the notice of sale is issued. The Sheriff conducts and appraisal of the property to be sold and no sale can be less than 2/3rds of the appraised value of the property.


Is there a right of redemption in New Mexico?

New Mexico has a statutory right of redemption, which would allow a party whose property has been foreclosed to reclaim that property within nine (9) months after the sale by making payment in full of the sum of the unpaid loan plus costs, taxes and interest at the rate of 10%.


Are deficiency judgments permitted in New Mexico?

Yes. A deficiency judgment may be obtained when a property in foreclosure is sold at a public sale for less than the loan amount which the underlying mortgage secures. There is a specific provision for deficiency judgments as part of non-judicial foreclosures with the exception that no deficiency judgment is permitted in the case of a sale related to low income property. This means that the borrower still owes the lender for the difference between what the property sold for at auction and the amount of the original loan. Deficiency judgments are not


What statutes govern New Mexico foreclosures?

The laws that govern New Mexico foreclosures are found in New Mexico Statutes Annotated (1978); Chapter 48, Articles 48-7-1 to 48-7-24 and Deeds of Trust are governed by Chapter 48, Articles 48-10-1 to 48-10-21.


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