New Mexico sellers hold mortgages, deeds of trust and real estate contracts collected through escrow companies. We work out which one you have, take it to competing buyers and show the math.
How a New Mexico holder ends up with a weak offer.
The same worksheet comes with every offer.
| Remaining balance | $129,400 |
|---|---|
| Payments left | 168 |
| Buyer’s target yield | 8.0% |
| Purchase price | $115,000 |
| Discount from balance | 11.1% |
| Our fee | shown on every offer |
| Sell the whole note | Sell 60 payments | Keep it | |
|---|---|---|---|
| Cash today | $115,000 | $56,200 | $0 |
| Payments still coming to you | None | 108 payments of $1,140 | 168 payments of $1,140 |
| Total you receive | $115,000 | $179,320 | $191,520 |
| What you give up | Every future payment | The next five years | A lump sum now |
Illustrative example. Totals add up the payments as scheduled; they assume the payer keeps paying and are not adjusted for the value of money over time.
The promissory noteThe mortgage or deed of trustA payment historyThe closing statement from the saleA New Mexico seller may hold a mortgage, a deed of trust or a real estate contract, and a buyer prices each one differently because the route after a default differs.
| Document | How it works | After a default, in general |
|---|---|---|
| Mortgage | The payer holds title and you hold a lien, a legal claim on the property. | A court case, known as judicial foreclosure. |
| Deed of trust | A trustee holds title as security for the loan. | A sale without a court case is possible in some situations. Practice varies. |
| Real estate contract | You keep legal title while the buyer pays over time. The signed deeds are commonly held by an escrow company that also collects the payments. | The contract’s own default terms apply. |
A general description only. The law behind each row changes from time to time, so ask a New Mexico attorney or title company which process applies to your document.
The real estate contract is New Mexico’s own widely used form of installment sale. If your payments arrive from an escrow company, it may be what you hold. It is close to what other states call a land contract, and selling one means transferring your position in the contract along with the title.
If you cannot tell which of the three documents you hold, tell us what you have and we will work that out before any buyer sees the file.
Seller financing is a familiar way to sell property in New Mexico, and a lot of it sits outside the cities. In Albuquerque, Rio Rancho, Santa Fe and Las Cruces, holders are people who sold a house or a small rental and carried the loan. Farther out, the paper is on other things: an adobe near Taos, a cabin around Ruidoso, a manufactured home on an acre in Valencia County, or ranch land and subdivided lots in Torrance and Luna counties.
Some of these notes are small and old, and have passed from the original seller to a spouse or children who now collect the payments without having set up the sale.
A buyer sets a price from the return they need on their money. An escrow company’s payment history helps you here, because it shows every payment and date without relying on your own ledger. The collateral can work the other way. Rural land, homes on a well and septic system, and manufactured homes all take more checking, and for a manufactured home the buyer needs to know whether it is legally part of the land. Our page on mobile home notes covers that question.
A buyer will also confirm that nothing is recorded ahead of your claim on the property, since anything with priority over it lowers the offer.
Ask the escrow company for a current payment history and a copy of the contract it holds. Add the recorded mortgage or deed of trust if there is one. While you have the escrow company on the line, ask whether the signed deeds are still in its file and whether it also collects for property taxes and insurance, since a buyer will want both answers.
In most cases, yes. A buyer takes over your position in the contract and the title that goes with it, and the escrow arrangement is updated so payments go to the new holder. Not every note buyer takes these contracts, which is one reason to ask several.
Yes. The escrow company's ledger is an independent record of every payment and its date, and a buyer can rely on it without taking your word for the history. Ask the company for a current payment history before you request a quote.
A mortgage in New Mexico is generally foreclosed through a court case. A sale without court can be possible under some deeds of trust, and real estate contracts follow their own default process. Which applies depends on your document, so have a local attorney confirm it.
Often you can. The first question a buyer asks is whether the home is legally part of the land or still titled separately like a vehicle. A home that is part of the real estate, on land the payer owns, draws more interest.