New Mexico Foreclosure Procedure
The state of New Mexico mandates the judicial and non-judicial foreclosures. The Deed of Trust Act allows non-judicial foreclosures. A Deed of Trust is a conveyance of the fee simple interest in trust to secure an indebtedness or charge against real property conveyed, with or without a power of sale, vested in the trustee to sell according to the terms as set forth in the instrument
However, the act applies only to business and commercial loans on real estate in excess of $500,000 and then only if the borrower agreed, in writing, to the deed of trust arrangement.
As the method suggests, in judicial foreclosures, a lender has to file a lawsuit and win a judgment to secure foreclosure and facilitate the sale in a manner required by law. Once the lender wins a judgment, then it can go ahead and arrange to sell the property to pay off what the borrower owes, in accordance with the court judgment.
A notice of sale must first be given, and then a sale can take place in 30 days. The notice of sale should specify the date, time and place of sale. It should also give a legal description of the property. The notice of sale must be published once a week for four consecutive weeks. The last ad must be published at least three days before the foreclosure sale.
The borrower has the option to prevent the foreclosure if he or she would be able to pay the mandated amount before the foreclosure sale. The property will be sold to the highest bidder. However, if the sale fails due to lack of bidding, then the property may be offered again for sale any time before the return date on the writ of execution issued by the court to enforce its judgment.
The whole process takes a minimum of eight months to complete. Two months to default parties, four to six months until entry of judgment, and two more months before the sheriff publishes and posts the property for sale.
Redemption
After the sale, the real estate may be redeemed by the former borrower or owner by paying, at any time within nine months from the date of sale, the amount of the successful foreclosure bid, with interest at 10 percent a year, plus taxed and costs. The parties may agree to a shorter term, but not less than one month. For good cause, however, the court can increase the period to not more than nine months.
Once the borrower files the suit for redemption and serves it on the lender, the lender has 30 days to respond. Sometime after the response, or by default, the court will hold a hearing to determine the amount of money necessary for redemption. At the conclusion of the hearing, the clerk of the court will issue a certificate of redemption.
Deficiency
A lender may obtain a deficiency judgment. The matter is unregulated by statute.
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