In no event shall an association make a loan, purchase or sell a note or lien or enter into any participation transaction authorized in the Savings and Loan Act in violation of any regulation promulgated by the supervisor, and no association shall:
A. make a real estate loan [on real estate] on which is located, or on which, from the proceeds of the loan, will be located a home, or homes, or combination of home and business property that exceeds eighty percent of the appraised valuation of the real estate plus the value of any savings account in the association or any first mortgage real estate loan pledged as additional collateral to secure the loan; provided that an association may make loans on single-family dwellings in an amount not to exceed ninety percent of the appraised valuation of the real estate plus the value of any savings account in the association or any first mortgage real estate loan pledged as additional collateral to secure the loan, if:
(1) the net worth of the association is not less than three percent of total assets; and
(2) the aggregate of the ninety percent loans does not exceed twenty percent of the total assets of the association; and
(3) the principal obligation of the ninety percent loans does not exceed the amount established by the supervisor. As used in this subsection, "home" means a dwelling for not more than four families, and "appraised valuation of the real estate" may include the value of any lease or contract on the real estate;
B. make a real estate loan other than the type described in Subsection A that exceeds seventy-five percent of the appraised valuation of the real estate plus the value of any additional collateral of the type described in Subsection A pledged to secure the loan;
C. make a real estate loan for a term in excess of thirty years;
D. make a real estate loan to an officer or director of the association unless the loan is first approved by its board of directors and the approval recorded in the minutes of the meeting of the board at which the loan was approved;
E. make a real estate loan unless the property has been appraised:
(1) by one or more qualified real estate appraisers designated by the board of directors. Each appraisal shall be in writing with a certificate signed by the appraisers stating that they have personally examined the described property, setting forth the value of the land and, separately the nature, condition and value of the improvements, or improvements to be made, if any. The appraisal shall be filed and preserved by the association;
(2) in the case of an insured or guaranteed loan, the appraisal may be made by any appraiser appointed by any lending, insuring or guaranteeing agency of the United States or of this state which insures or guarantees the loan, wholly or in part. A copy of any appraisal, or of the commitment or certificate of the insuring or guaranteeing agency, shall be filed and preserved by the association;
(3) in any case in which a loan is secured by real estate with part or all of the loan being made in reliance upon the mortgage guaranty or insurance of a private mortgage guaranty firm licensed and qualified to do business in New Mexico, only that part of the loan, if any, which is not made in reliance upon the guaranty or insurance is subject to limitations with respect to the ratio of the amount of loan to the value of the property;
(4) the supervisor may, when good cause exists, cause an independent appraisal to be made of any property upon which a loan has been made, and the reasonable travel and subsistence expenses and compensation to the appraisers, not in excess of comparable fees paid for the same or similar appraisals in the same area, shall be paid by the association owning or holding the property as mortgagee;
F. make a real estate loan which is not secured by a first and prior lien upon the property described in the mortgage, deed of trust or other instrument creating or constituting the lien unless every prior lien of record thereon is owned by or subordinated to the association. The first and prior lien shall be evidenced by an attorney's title opinion or mortgagee's title insurance policy;
G. make a real estate loan unless the insurable improvements thereon are insured against loss by a fire and extended coverage policy or its equivalent issued by an insurance company authorized to do business in this state;
H. sell or transfer a prior lien held by the association while retaining a junior lien on the same security to secure an unsatisfied obligation due the association unless the junior lien or liens were created in connection with a loan made under Sections 38 [58-10-38 NMSA 1978] or 39 [58-10-39 NMSA 1978] of the Savings and Loan Act; or
I. make collateral loans secured by the assignment of other loans, except where:
(1) each assigned loan is one which the association could itself make or purchase at par under applicable law and regulations, based on a current association appraisal;
(2) the amount of the collateral loan does not exceed at any time ninety percent of the aggregate unpaid balance of the assigned loans;
(3) the assignment to the association provides that:
(a) all payments of principal and interest on the assigned loans shall be made directly to the association and applied to the outstanding unpaid balance of the collateral loan; and
(b) a default on any assigned loan constitutes a default on the collateral loan and permits acceleration of the maturity of the collateral loan; and
(4) the assignment is properly recorded and is prior to any other lien of record on the assignor's interest in the assigned loans.
History: 1953 Comp., § 48-15-83, enacted by Laws 1967, ch. 61, § 39.
Cross references. — For meaning of "supervisor", see 58-10-2J NMSA 1978.
Am. Jur. 2d, A.L.R. and C.J.S. references. — 10 Am. Jur. 2d Banks §§ 683 to 688, 692, 693.
What constitutes "business or commercial" purpose within meaning of § 104(1) of Truth in Lending Act (15 USCS § 1603(1)), exempting business or commercial credit transactions from act, 54 A.L.R. Fed. 491.
Award of attorney's fees under § 130 (a) of Truth in Lending Act (15 USCS § 1640 (a)), 140 A.L.R. Fed. 557.
9 C.J.S. Banks and Banking § 606; 12 C.J.S. Building and Loan Associations § 4.
Structure New Mexico Statutes
Chapter 58 - Financial Institutions and Regulations
Article 10 - Savings and Loan Associations
Section 58-10-1 - Short title.
Section 58-10-2 - Definitions.
Section 58-10-3 - Application for charter.
Section 58-10-4 - Permanent capital stock.
Section 58-10-5 - Stock requirements for proposed permanent capital stock associations.
Section 58-10-7 - Savings account requirements for proposed permanent capital stock associations.
Section 58-10-10 - Capital debentures or notes.
Section 58-10-11 - Hearings on charter application.
Section 58-10-12 - Approval of application for charter.
Section 58-10-13 - Refusal of charter application; appeal.
Section 58-10-14 - Forfeiture of charter for failure to commence business.
Section 58-10-15 - Amendment of charter and bylaws.
Section 58-10-16 - Corporate name; exclusive use.
Section 58-10-17 - Branch offices.
Section 58-10-18 - Change of office.
Section 58-10-19 - Board of directors.
Section 58-10-20 - Organizational meeting.
Section 58-10-21 - Qualification of directors.
Section 58-10-23 - Indemnity bonds of directors, officers and employees.
Section 58-10-24 - Meetings; voting.
Section 58-10-25 - Access to records.
Section 58-10-27 - Misdescription of assets.
Section 58-10-28 - Charging off or setting up reserves against bad assets.
Section 58-10-29 - Membership records.
Section 58-10-30 - Financial statement.
Section 58-10-31 - Annual reports; other reports.
Section 58-10-32 - Power to borrow.
Section 58-10-33 - General corporate powers.
Section 58-10-34 - Fiscal agent.
Section 58-10-35 - Powers under federal law.
Section 58-10-36 - Original real estate loans.
Section 58-10-37 - Dealing in real estate loans.
Section 58-10-38 - Participation with others in real estate loans.
Section 58-10-39 - Requirements in lending transactions.
Section 58-10-40 - Advances to protect security.
Section 58-10-41 - Charges for real estate loans.
Section 58-10-42 - Insured and guaranteed loans.
Section 58-10-43 - Loans on security of savings accounts.
Section 58-10-44 - Property improvement, educational and manufactured home financing loans.
Section 58-10-45 - Investment in securities.
Section 58-10-46 - Acquisition of real property.
Section 58-10-47 - Investment in office buildings.
Section 58-10-48 - Valuation of real property of an association.
Section 58-10-49 - Appraisals of real estate owned.
Section 58-10-50 - Powers and privileges of association.
Section 58-10-51 - Limitation on savings accounts.
Section 58-10-52 - Uninsured accounts; notice.
Section 58-10-53 - Insurance of accounts; failure to obtain or maintain.
Section 58-10-54 - Who may open a savings account.
Section 58-10-55 - Savings contracts.
Section 58-10-56 - Evidence of account ownership.
Section 58-10-57 - Transfer of savings accounts.
Section 58-10-58 - Lost or destroyed evidence of ownership.
Section 58-10-59 - Savings accounts of minors.
Section 58-10-60 - Power of attorney on savings accounts.
Section 58-10-61 - Pledge of savings account in joint tenancy.
Section 58-10-62 - Accounts of fiduciaries.
Section 58-10-63 - Withdrawals from savings accounts.
Section 58-10-64 - Redemption of savings accounts.
Section 58-10-65 - Lien on savings accounts.
Section 58-10-66 - Paying dividends on savings accounts.
Section 58-10-67 - Computation of net income.
Section 58-10-68 - Transfers to loss reserves.
Section 58-10-69 - Dividends on permanent capital stock.
Section 58-10-70 - Use of surplus accounts and expense fund contributions.
Section 58-10-71 - Savings and loan supervisor.
Section 58-10-72 - General powers of supervisor.
Section 58-10-73 - Regulations.
Section 58-10-74 - Confidential information.
Section 58-10-75 - Supervisor; disposition of fees.
Section 58-10-76 - Audits and examinations; fees.
Section 58-10-77 - Other examinations.
Section 58-10-78 - Federal examination.
Section 58-10-79 - Additional examinations.
Section 58-10-80 - Order to discontinue violations.
Section 58-10-81 - Removal of directors, officers and employees.
Section 58-10-82 - Order to refrain from voting shares.
Section 58-10-83 - Emergency power of supervisor.
Section 58-10-84 - When order is final; appeal.
Section 58-10-85 - Receivership.
Section 58-10-86 - Communications from supervisor.
Section 58-10-87 - Reorganization; merger; consolidation.
Section 58-10-88 - Voluntary liquidation.
Section 58-10-89 - Exemption from securities laws.
Section 58-10-90 - All businesses to conform.
Section 58-10-91 - Outstanding items considered as savings accounts.
Section 58-10-92 - Judicial review.
Section 58-10-93 - Slander; felony.
Section 58-10-94 - Violation of act; civil penalty.
Section 58-10-95 - Violations; criminal penalties.
Section 58-10-96 - Suppressing evidence; felony.
Section 58-10-97 - Disclosure of confidential information; felony; civil liability.
Section 58-10-98 - Conversion into federal association.
Section 58-10-99 - Conversion into state chartered association.
Section 58-10-101 - Foreign associations.
Section 58-10-102 - Federal associations; applicability.
Section 58-10-103 - Payment from savings account of decedent.
Section 58-10-104 - Authority to engage in leasing safe deposit facilities; subsidiary company.
Section 58-10-105 - Access by fiduciaries.
Section 58-10-106 - Effect of lessee's death or incapacity.
Section 58-10-107 - Lease to minor.
Section 58-10-108 - Search procedure on death.
Section 58-10-109 - Adverse claims to contents of safe deposit box.
Section 58-10-110 - Special remedies for nonpayment of rent.
Section 58-10-111 - Limitation of liability on construction loans.