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New Mexico REALTORS® Push to Reinstate Seller Financing

By HOM Editorial Team
July 2015

The REALTORS® Association of New Mexico works hard to help current and prospective property owners. One of the Association’s current priorities is to help protect seller financing.

Seller financing is an important option for many buyers and sellers in New Mexico. In Albuquerque alone, there are more than 1,500 seller-financed transactions every year. Buyers who may not qualify for traditional lending from financial institutions can become homeowners through seller financing. For example, selling a mobile home attached to a property where the initial financing has not been paid off is virtually impossible without seller financing, because banks will not loan on a non-conforming property. Seller financing also fills a gap in rural areas where banking is limited.

Unfortunately, some laws and regulations passed during the recession with the intent to protect consumers have ended up hurting them by restricting seller financing. Such restrictions make it more difficult, if not impossible, for many people to achieve the dream of home ownership. New Mexico has a particularly high percentage of owner-financed homes and has been acutely impacted by these laws and regulations.

The REALTORS® Association of New Mexico, in cooperation with the Save Seller Financing Coalition, has already met success in changing the way the Consumer Finance Protection Bureau views seller-financing transactions. As a direct result of efforts by the REALTORS® and the Coalition, the Bureau found that the type of seller financing most individual owners and purchasers are engaged in does not pose a systemic risk for the nation’s financial system. The Bureau agreed to exempt seller financing from mortgage services rules, alleviating a large burden for seller-financers. The Bureau also indicated that it would reevaluate rules and regulations that govern seller financing, and the new rules are expected to be more favorable toward such transactions.

The REALTORS® Association of New Mexico is optimistic that its work to protect seller financing will follow in the steps of its other successful legislative initiatives. In visible ways and behind the scenes, New Mexico REALTORS® are committed to continuing work to help educate and protect New Mexico consumers.

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