Redemption rights

In the state of New Mexico, you are entitled to a bundle of rights when you purchase a property. One of those rights is "The Right of Redemption." This right allows you to purchase the property back from the plaintiff (in most cases the bank), in cash, for what the property sold for at auction. ​

At the final stage of the foreclosure process, homeowners in New Mexico have the right to redeem or recover ownership of their house after it’s sold through a district court-ordered foreclosure auction. New Mexico is one of 16 states where so-called “redemption rights” are available outright.

What Is Right of Redemption?

The right of redemption allows individuals who have defaulted on their mortgages the ability to reclaim their property by paying the amount due (plus interest and penalties)  after a foreclosure sale (for the foreclosure price, plus interest and penalties).

Right of redemption is a legal process that allows a delinquent mortgage borrower to reclaim their home or other property subject to foreclosure if they are able to repay their obligations in time.

In some states, this right can be exercised even if the lender has already re-sold the property, as long as it is still within the redemption time frame and all conditions are met.

A successful redemption will also typically require the borrower to repay any costs incurred to the lender or other parties as a result of the foreclosure process.

Understanding Right of Redemption

When an individual obtains a mortgage to buy a home, the home itself serves as the collateral for the loan. That means that the home owner forfeits ownership of the home if they default on their payments. Many mortgage notes include the right of foreclosure, which describes a lender's ability to take possession of a property through a legal process called foreclosure and outlines the conditions under which the lender has the right to foreclose. (State and national laws also regulate the right of foreclosure.)

When homeowners default on their mortgage payments, lenders may invoke their right to foreclosure. Lenders must abide by specific procedures in order for a foreclosure to be legal. First, they must provide a default notice to the borrower, alerting them to the fact that their loan is in default from missed payments. The homeowner then generally has a specified amount of time to make good on any missed payments and avoid foreclosure. They will likely also be required to pay late payment fees in addition to any outstanding balance. They may also use this time to fight the foreclosure if they believe that the lender does not actually have the right to foreclose on the property.

If a home eventually is foreclosed upon, the lender will generally sell the property in order to recoup money lost on the loan. The right of redemption gives mortgagors the opportunity to reclaim their property and stop a foreclosure sale from happening, or, in some cases, even repurchase their property after a sale has occurred.

 The ability to exercise a right of redemption, as well as how long the redemption period is, varies from state to state.

How Right of Redemption Can Be Exercised

A right of redemption may be exercised during a time frame called the redemption period after a foreclosure auction has concluded. In New Mexico normally the redemption period is 30 days from the sale. 

Despite the opportunity to exercise the right of redemption before a foreclosure sale, borrowers tend to only exercise a right of redemption after a foreclosure if they do at all. This is because borrowers who already have enough funds to cover the costs of paying off the entire outstanding debt plus other fees are unlikely to have lapsed into default in the first place.

How Right of Redemption Helps Borrowers

Theoretically, the right of redemption can help mortgagors stay in their homes. In reality, though, the right of redemption is not regularly practiced, because most borrowers in default don't have the ability to come up with the large sums of cash needed to exercise the right. 

Can I sell my Redemption Rights?

YES!  Fortunately, New Mexico along with other states permit homeowners to sell their Right of Redemption.  In New Mexico, this is a very common practice.  Here’s where we come in.  The process of selling your redemption rights is a simple 3-step process:

We agree on a price we’re willing to pay for your rights. 

We will meet you at our company’s bank where you sign the rights in front of a Notary (because this is a legal document to be filed in District Court).

We will then give you certified funds or cash as agreed.  If you are still occupying the property, we can agree on a time frame in which you will need to vacate according to our agreed upon terms. Our company then uses the redemption rights to redeem/buy the property through the courts. 

How We Can Help

We can make you a cash offer today for your Redemption Rights. Most of the time this is the last option of during the foreclosure period for a Homeowner to recoup any money out of their property before it goes back to the bank or the winner of the foreclosure auction. This is a quick and easy process can put money in your pocket right away. Don't let these go to waste! 

Service Areas: Santa Fe, Albuquerque, Taos, Angel Fire, Red River, Espanola and all throughout the state!