Is a license required? Not applicable. See below.
State specific loan modification law? Yes. Offering loan modification services, is interpreted by the New Mexico Regulation and Licensing Department, Financial Institutions Division to quality as debt adjusting.

Debt adjusting is outlawed in New Mexico Statutes Chapter 56 Section 22(Attached as Schedule A).

Advantages of becoming a licensed Mortgage Broker? Not applicable.


Penalties for operating in the state without a license: Not applicable.
Is an advanced fee permitted? Not applicable.
Is a written agreement required? Not applicable.
Other noteworthy information? Someone at the Financial Institutions Division was contacted to look for any alternate avenue. The exception allowing attorney’s to engage in debt adjusting does not extend to their staff, which would mean an attorney would have to handle the entire service themselves and only applies in the regular course of their legal work. The Attorney General’s office was also contacted and stated that loan modification services are illegal in New Mexico and have no exception.
New Mexico Statutes

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Section 56-2:

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New Mexico Regulation and Licensing Department Financial Institutions Division Contact Info:

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56-2-1. Definitions.
As used in this act [56-2-1 to 56-2-4 NMSA 1978]:
A. “person” means an individual, partnership, corporation and association;
B. “debt adjuster” means a person who acts or offers to act for a consideration as an intermediary between a debtor and his creditors for the purpose of settling, compounding or in anywise altering the terms of payment of any debts of the debtor; and, to that end, receives money or other property from the debtor, or on behalf of the debtor, for payment to, or distribution among the creditors of the debtor;
C. “debtor” means an individual, and includes two (2) or more individuals who are jointly and severally, or jointly or severally indebted.

56-2-2. Prohibition; penalty.
Any person who shall hereafter act or offer to act as a debt adjuster in this state shall be guilty of a misdemeanor.

56-2-3. Injunction.
Courts of record shall have power, in an action brought in the name of the state by the attorney general, to enjoin any person from acting or offering to act as a debt adjuster; and, in such action, may appoint a receiver for the property and money employed in the transaction of business by such person as a debt adjuster, to insure, so far as may be possible, the return to debtors of so much of their money and property as has been received by the debt adjuster, and has not been paid to the creditors of the debtors.

56-2-4. Exemptions.
The following persons shall not be deemed debt adjusters for the purposes of this act [56-2-1 to 56-2-4 NMSA 1978]: any attorney-at-law admitted to practice in this state; any person who is a regular, full-time employee of a debtor, and who acts as an adjuster of his employer’s debts; any person acting pursuant to any order or judgment of court, or pursuant to authority conferred by any law of this state or of the United States; any person who is a creditor of the debtor, or an agent of one (1) or more creditors of the debtor, and whose service in adjusting the debtor’s debts are rendered without cost to the debtor; and any person who, at the request of a debtor, arranges for or makes a loan to the debtor, and who, at the authorization of the debtor, acts as an adjuster of the debtor’s debts in the disbursement of the proceeds of the loan, without compensation for the services rendered in adjusting such debts; nonprofit corporations organized as a community effort to assist debtors.

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