No provision in a home loan or a loan for a mobile home, the evidence of indebtedness of a home loan, a real estate contract or an obligation secured by a real estate mortgage or other purchase contract requiring a penalty or premium for prepayment of an installment payment or prepayment of the balance of the indebtedness is enforceable.
History: Laws 1980, ch. 64, § 9; 2009, ch. 151, § 1.
The 2009 amendment, effective June 19, 2009, after "home loan", added "or a loan for a mobile home"; after "real estate mortgage", added "or other purchase contract"; and after "prepayment of", added "an installment payment or prepayment of".
Federal preemption. — When applied to federally-chartered thrift institutions and banks federal law preempts 56-8-30 NMSA 1978, which prohibits banks from collecting prepayment penalties on home mortgages. Stoneking v. Bank of Am., N.A., 2002-NMCA-042, 132 N.M. 79, 43 P.3d 1089
A complete prohibition against prepayment is a penalty forbidden by this section. Naumburg v. Pattison, 1985-NMSC-120, 103 N.M. 649, 711 P.2d 1387.
Am. Jur. 2d, A.L.R. and C.J.S. references. — Validity and construction of provision of mortgage or other real-estate financing contract prohibiting prepayment for a fixed period of time, 81 A.L.R.4th 423.
Structure New Mexico Statutes
Chapter 56 - Commercial Instruments and Transactions
Article 8 - Money, Interest and Usury
Section 56-8-1 - [Lawful money; definition; application.]
Section 56-8-2 - [Denominations to be reduced to lawful basis in actions.]
Section 56-8-3 - Interest rate; no written contract.
Section 56-8-4 - Judgments and decrees; basis of computing interest.
Section 56-8-5 - Interest; open accounts.
Section 56-8-6 - Grain purchase contracts; disclosure regarding act of God clause.
Section 56-8-7 - Procuring loans; rate of commission; exceptions.
Section 56-8-8 - [Excessive commission for procuring loan; penalty.]
Section 56-8-9 - Excessive charges prohibited; applicability of maximum rates; definition.
Section 56-8-10 - Farm, ranch and agriculture loans.
Section 56-8-12 - Loans by agent; liability of principal.
Section 56-8-13 - Penalties and forfeitures.
Section 56-8-14 - Criminal penalty.
Section 56-8-15 to 56-8-20 - Repealed.
Section 56-8-21 - Usury; corporations and limited partnerships.
Section 56-8-22 - Short title.
Section 56-8-23 - Purpose of act.
Section 56-8-24 - Definitions.
Section 56-8-25 to 56-8-28 - Repealed.