SENATE MEMORIAL 40

51st legislature - STATE OF NEW MEXICO - first session, 2013

INTRODUCED BY

Howie C. Morales

A MEMORIAL

REQUESTING THE NEW MEXICO MORTGAGE FINANCE AUTHORITY TO CREATE A TASK FORCE TO STUDY THE LIKELY EFFECTS OF LEGISLATION INTENDED TO PROTECT LOW-INCOME HOMEBUYERS WHO ENTER INTO SELLER-FINANCED CONTRACTS AND TO HELP AFFECTED COUNTIES TO MANAGE THEIR LAND.

     WHEREAS, many low-income New Mexicans seek for themselves and their families the security of owning a home; and

     WHEREAS, many of those people cannot secure conventional mortgages because they lack sufficient assets and acceptable credit histories; and

     WHEREAS, often, they instead enter into seller-financed contracts in order to buy homes; and

     WHEREAS, there are not enough protections to ensure that a homebuyer who enters into a seller-financed contract is fully informed of the terms of the sale, the description and condition of the property and the buyer's contractual rights and responsibilities; and

     WHEREAS, the legal remedies available to those who have been victims of injustice that results from entering into seller-financed contracts are inadequate; and

     WHEREAS, since the law does not sufficiently require that seller-financed home sales be recorded with county clerks, many counties cannot effectively manage their land development; and

     WHEREAS, often, groupings of homes financed through unregulated seller-financed contracts develop outside of recognized, legal subdivisions and, therefore, lack safety- and health-promoting infrastructure, such as roads and provisions for water, electricity, natural gas and wastewater treatment; and

     WHEREAS, developing infrastructure after communities form in situations like these is problematic because the unrecorded transactions make property rights difficult to determine; and

     WHEREAS, laws intended to protect these homebuyers and counties should not hamper sellers who enter into ethically sound seller-financed contracts; and

     WHEREAS, the New Mexico mortgage finance authority is responsible for ensuring that all New Mexicans have high-quality, affordable housing opportunities;

     NOW, THEREFORE, BE IT RESOLVED BY THE SENATE OF THE STATE OF NEW MEXICO that the New Mexico mortgage finance authority be requested to create a task force to study the fiscal and social implications of statutory requirements and remedies that would help to protect low-income homebuyers who enter into seller-financed contracts and help affected counties to manage their land; and

     BE IT FURTHER RESOLVED that the task force be composed equally of low-income homebuyers who enter into seller-financed contracts and their advocates, home sellers who enter into seller-financed contracts and their advocates, representatives of county governments and their advocates and representatives of the consumer protection division of the office of the attorney general; and

     BE IT FURTHER RESOLVED that by November 2013, the New Mexico mortgage finance authority report to the Mortgage Finance Authority Act oversight committee the task force's findings and recommendations; and

     BE IT FURTHER RESOLVED that copies of this memorial be transmitted to the New Mexico mortgage finance authority, the Mortgage Finance Authority Act oversight committee, the attorney general, the New Mexico real estate commission, the public regulation commission and the governor.

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