How foreclosure works in New Mexico

The notices you will receive in New Mexico, in order

1. Notice of right to cure the default

   Sent by the lender before it can sue, on most owner-occupied home loans

   New Mexico's Home Loan Protection Act requires this letter. It tells you what the default is, how much it takes to catch up, and a date at least 30 days away to pay before the lender can sue. The lender must accept partial payments sent in response. If you think the amount is wrong, call the contact person the notice must name.

   NMSA § 58-21A-6(A)

2. Pre-filing notice of loss mitigation options

   Sent by the lender before it files the lawsuit

   The lender must send you a list of the loss mitigation options you may have, say whether your loan is federally backed, name who holds the loan, give the servicer's contact information, and list places to get help. The clerk will not accept a home foreclosure complaint without a certification that this was done. Keep this notice: it tells you what to apply for.

   Rule 1-003.3 NMRA; Form 4-227 NMRA

3. Summons and Complaint

   Served on you after the lender files in district court, after the federal 120-day wait

   The complaint is the lender's lawsuit asking the court to foreclose. The summons gives you 30 days to file an Answer or a Motion. If you do nothing, the lender can ask for a default judgment without a trial.

4. Order of Referral to the Foreclosure Settlement Program

   Mailed by the court in many residential cases, soon after the case is filed

   This order sends your case to the court's settlement program and puts the lawsuit on hold. Fill out the Homeowner Information Form before the deadline in the order, and watch for a call or email from the program about a status conference.

5. Judgment and order of foreclosure

   Entered by the judge after the case is decided, by default, motion or trial

   The judgment states what you owe and orders the home sold. For an owner-occupied home, the lender must first certify that it is not negotiating with you about loss mitigation. The sale cannot happen until at least 30 days after this judgment.

   Rule 1-054.2 NMRA; NMSA § 39-5-17

6. Notice of sale

   Published for 4 weeks before the sale

   This notice names the case, the judgment amount with interest, the property, and the date, hour and terms of the sale. It is published in a newspaper in your county and posted in public places. It tells you exactly when your last pre-sale options run out.

   NMSA §§ 39-5-1, 39-5-3

7. Special master's report and order confirming sale

   Filed after the auction, once the judge reviews the sale

   The person who ran the sale reports the result to the court, and the judge enters an order confirming the sale. The date that order is filed starts your redemption period. If you are still in the home later, the buyer can ask the court for a writ of assistance, which lets the sheriff remove you.

   NMSA § 39-5-18(E)

The legal steps in New Mexico

1. Missed payments and the right-to-cure notice

   After the federal 120-day wait, the lender can sue. But for most owner-occupied home loans, New Mexico's Home Loan Protection Act first requires a written notice of your right to cure the default. It must give you at least 30 days to catch up, tell you the amount, and name a person to contact if you disagree. The lender must accept partial payments made in response to the notice.

   NMSA § 58-21A-6(A)

2. Pre-filing notice and the lawsuit

   Before the court clerk will accept a home foreclosure complaint, the lender must certify that it sent you a list of the loss mitigation options available to you, whether your loan is federally backed, who holds the loan and how to reach the servicer, and a list of places to get help. You are then served with a summons and complaint filed in the district court for your county.

   Rule 1-003.3 NMRA; Form 4-227 NMRA

3. You have 30 days to respond

   The New Mexico Courts self-help center says you have 30 days to file an Answer or a Motion with the court. If you do not respond, the lender can ask for a default judgment without a trial. In your answer you can raise defenses, including any violation of the Home Loan Protection Act.

   NMSA § 58-21A-6(E)

4. Foreclosure Settlement Program

   In residential cases, the court may send an Order of Referral to its Foreclosure Settlement Program. Your case is put on hold (stayed) while a neutral settlement facilitator helps you and the lender talk. You must turn in the Homeowner Information Form by your deadline and complete the lender's loss mitigation application. If no deal is reached, the stay is lifted and the case goes back to the judge.

5. Judgment

   Before the judge can enter a foreclosure judgment on an owner-occupied home, the lender must certify that it tried to engage you in loss mitigation and is not currently negotiating with you. If your mortgage shortens the redemption period, the time to ask the judge to lengthen it is before this judgment is entered.

   Rule 1-054.2 NMRA; NMSA § 39-5-19

6. Sale and confirmation

   The home cannot be sold until at least 30 days after the judgment. During those 30 days you can stop the sale by depositing the full judgment, interest and costs with the district court clerk. Notice of the sale must be published for 4 weeks. After the sale, usually run by a special master, the judge reviews the special master's report and enters an order confirming the sale.

   NMSA §§ 39-5-1, 39-5-17

7. Redemption period and moving out

   After the order confirming the sale is filed, you can buy the home back within 9 months, or within the shorter period your mortgage sets (never less than 1 month). If you are still in the home, the buyer can ask the court for a writ of assistance, which lets the sheriff remove you. Plan your move early and ask about any money left over from the sale.

   NMSA §§ 39-5-18, 39-5-19

Common questions in New Mexico