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House Bill 205:
Mortgage Foreclosure Consultant Fraud Prevention Act 04-30-10
The
Legislature of the State of New Mexico 49th Legislature, 2nd Session
LAWS 2010
CHAPTER 58
HOUSE
JUDICIARY COMMITTEE SUBSTITUTE FOR HOUSE BILL 205
AN ACT
RELATING TO PROPERTY;
ENACTING THE MORTGAGE FORECLOSURE CONSULTANT FRAUD PREVENTION ACT; IMPOSING
PENALTIES.
BE IT ENACTED BY THE
LEGISLATURE OF THE STATE OF NEW MEXICO:
Section 1. SHORT
TITLE.–This act may be cited as the “Mortgage Foreclosure Consultant Fraud
Prevention Act”.
Section 2.
DEFINITIONS.–As used in the Mortgage Foreclosure Consultant Fraud Prevention
Act:
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A.
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“compensation”
means monetary payment, remuneration or other benefits received, including
monetary donations made in conjunction with the performance of services;
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B.
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“foreclosure
consultant”:
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(1)
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means
a person who, directly or indirectly, makes a solicitation or offer to an
owner to perform services for compensation or who, for compensation,
performs a service that the person represents will:
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(a)
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stop
or postpone a foreclosure sale;
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(b)
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obtain
any forbearance from a beneficiary or mortgagee;
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(c)
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assist
the owner to exercise the right to reinstatement;
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(d)
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obtain
an extension of the period within which the owner may reinstate the
owner's obligation;
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(e)
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obtain
a waiver of an acceleration clause contained in a promissory note, deed
of trust or contract secured by a mortgage on a residence in foreclosure
or contained in the mortgage;
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(f)
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assist
an owner in foreclosure or loan default to obtain a loan or advance of
funds;
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(g)
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avoid
or ameliorate the impairment of an owner's credit resulting from the
recording of a notice of default or from a foreclosure sale; or
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(h)
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otherwise
save an owner's residence from foreclosure; and
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(2)
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does
not include:
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(a)
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a
person licensed to practice law in this state when the person renders
service in the course of the person's practice as an attorney;
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(b)
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a
person licensed as a real estate broker or salesperson in this state when
the person engages in acts requiring real estate licensure, unless the
person is offering services designed to, or purportedly designed to,
enable the owner to retain possession of the residence in foreclosure;
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(c)
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a
person licensed as an accountant in this state when the person is acting
in any capacity for which the person is licensed as an accountant;
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(d)
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a
person acting under the express authority or written approval of the
United States department of housing and urban development or other
department or agency of the United States or this state to provide
services;
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(e)
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a
person who holds or is owed an obligation secured by a lien on any
residence in foreclosure when the person performs services in connection
with the obligation or lien if the obligation or lien did not arise as
the result of or as part of a proposed foreclosure reconveyance;
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(f)
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a
person doing business under any law of this state or of the United States
relating to banks, trust companies, savings and loan associations,
industrial loan and thrift companies, regulated lenders, credit unions or
insurance companies, or a mortgagee that is a United States department of
housing and urban development-approved mortgagee or any subsidiary or
affiliate of these persons, or any agent or employee of these persons
while engaged in the business of these persons;
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(g)
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a
person licensed as a residential mortgage originator or servicer pursuant
to the New Mexico Mortgage Loan Originator Licensing Act when acting
under the authority of that license;
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(h)
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a
nonprofit agency or organization registered pursuant to New Mexico law
that offers counseling or advice to an owner of a home in foreclosure or
loan default if the nonprofit agency or organization does not contract
for services with for-profit lenders or foreclosure purchasers; or
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(i)
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a
foreclosure purchaser, including a person who purchases a home in
foreclosure at, or subsequent to, a judicial sale of foreclosure
property;
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C.
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“foreclosure
reconveyance” means a transaction involving:
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(1)
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the
transfer of title to real property by a foreclosed homeowner during a
foreclosure proceeding on that homeowner's home, either by transfer of
interest from the foreclosed homeowner or by creation of a mortgage or
other lien or encumbrance during the foreclosure process that allows the
acquirer to obtain title to the property by redeeming the property as a
junior lienholder;
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(2)
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the
subsequent conveyance, or offer or promise of a subsequent conveyance, of
an interest back to the foreclosed homeowner by the acquirer or a person
acting in participation with the acquirer that allows the foreclosed
homeowner to possess either the residence in foreclosure or any other real
property, which interest includes, but is not limited to, an interest in a
contract for deed, purchase agreement, option to purchase or lease; or
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(3)
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the
authorization, solicitation or offer of a proposal to refinance the real
estate during the foreclosure process contingent on participation in any
life, term life or periodic insurance arrangement with any third party not
providing private mortgage insurance;
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D.
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“owner” means the
record owner of a residence in foreclosure at the time a foreclosure notice
of pendency was recorded or a summons and complaint for foreclosure was
served;
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E.
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“person” means an
individual, a partnership, a corporation, a limited liability company, an
association or other group, however organized;
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F.
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“residence in
foreclosure” means residential real property consisting of one to four family
dwelling units, one of which the owner occupies as the owner's principal
place of residence, where there is a delinquency or default on any loan
payment or debt secured by or attached to the residential real property,
including contract for deed payments; and
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