I have owned a home in New Mexico for many years. A few months ago I was laid off from my job and stopped making my mortgage payments. The house is now in foreclosure. If I lose it to a foreclosure sale, is there any way for me to get it back afterwards?
Yes, there is a way for you to get your home back after the foreclosure sale. In New Mexico, you can repurchase or “redeem” your home after losing it in foreclosure, but only for a limited amount of time. You'll have to come up with a significant amount of money to do so.
Redeeming After a Judicial Foreclosure in New Mexico
If the foreclosure is judicial (where the lender files a lawsuit in court to foreclose your home) you have nine months after the foreclosure sale to redeem your home (N.M. Stat. Ann. § 39-5-18(A)(1)). However, the mortgage contract can shorten the redemption period to just one month (N.M. Stat. Ann. § 39-5-19).
Notwithstanding the terms of the mortgage, the court can choose to extend the redemption period, though not longer than nine months (N.M. Stat. Ann. § 39-5-19).
Most residential foreclosures in New Mexico are judicial.
Redeeming After a Nonjudicial Foreclosure in New Mexico
The redemption period after a nonjudicial foreclosure (where the foreclosure takes place without court supervision) is the same as after a judicial foreclosure. You can redeem the home:
- within nine months after the sale, or
- within the time period provided in the deed of trust, whichever is the less (though not less than one month). (N.M. Stat. Ann. § 48-10-16(A)). (Learn about the difference between a mortgage and a deed of trust.)
Read Your Loan Documents
Most New Mexico mortgages and deeds of trust reduce the redemption period to one month. Be sure to check your loan documents before the sale to find out how long you have to redeem the home after the foreclosure. Otherwise you could find yourself out of luck if you wait too long to try to redeem your home.
If you don’t redeem the home within the allotted redemption period, your right to redeem expires. After that, you won’t have another opportunity to get your house back by redeeming it. Learn more general information about the right of redemption.
How Much You’ll Have to Pay to Get Your Home Back
In order to redeem the home after the foreclosure sale, you must pay to the purchaser (the person or entity, such as the bank, who bought it at the sale) the redemption amount, which consists of:
- the full price paid at the sale, plus interest from the sale date at the rate of 10% per year
- all taxes, interest, and penalties
- all payments the purchaser made after the sale to pay off any prior lien or mortgage not foreclosed, and
- interest on the taxes, interest, penalties, and payments made on liens or mortgages at a rate of 10% a year from the date of payment (N.M. Stat. Ann. § 39-5-18(A)(1), § 48-10-16(B)(1)).
How to Redeem
To redeem, you’ll have to:
- pay the redemption amount to the purchaser, or
- file a petition for redemption in the district court that entered the foreclosure judgment (in the case of a judicial foreclosure) or in the county where the trustee's sale was held (if it was a nonjudicial foreclosure). (N.M. Stat. Ann. § 39-5-18(A)(1),(2), § 48-10-16(B)(1),(2)).
If you file a petition for redemption, you’ll have to make a deposit in cash in the office of the clerk of the district court (N.M. Stat. Ann. § 39-5-18(A)(2), § 48-10-16(B)(2)). The purchaser will be served with a copy of the petition for redemption and must answer it within 30 days after service. Then the court will hold a hearing and the judge will determine the amount of money necessary for the redemption (N.M. Stat. Ann. § 39-5-18(B),(C), § 48-10-16(C),(D)).
Since you’ll have a limited time period to redeem, it may be worthwhile to hire a New Mexico attorney to help you navigate the redemption process.
If Possible, Don’t Wait Until After the Foreclosure to Save Your Home
In most cases if you want to keep your home, it is better to take action before the foreclosure sale. This will give you more options to save the property. For example, you could:
- pay off the past-due amounts to reinstate (catch up on) the loan, or
- work out an alternative to foreclosure that will allow you to keep the property, such as a mortgage modification, forbearance agreement, or repayment plan.
A New Mexico foreclosure will probably take at least several months to complete (especially if it is judicial), but you should be sure to explore alternatives to foreclosure as early in the process as possible. (To learn more about foreclosure laws and procedures in New Mexico, visit Nolo’s New Mexico Foreclosure Law Center.)
Finding New Mexico’s Redemption Laws
To find the statutes that discuss your right to redeem the home after a foreclosure in New Mexico, go to Chapter 39, Article 5, and Chapter 48, Article 10 of the New Mexico Statutes.