Closing Costs in New Mexico: A Guide for Sellers
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Joseph Gordon EditorJoseph Gordon is an Editor with HomeLight. He has several years of experience reporting on the commercial real estate and insurance industries.
Selling your home in New Mexico? One important aspect you need to understand is closing costs. These fees and expenses come due when finalizing the sale of your property. They can include things like transfer taxes, title insurance, and more.
Our short guide will walk you through how closing costs function in New Mexico and what you can expect to pay as a seller. This will help you better prepare for the financial aspects of your sale, ensuring a smoother transaction.
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Disclaimer: This article provides estimates of a seller’s closing costs that are meant for educational and research purposes only; our calculations are not a guarantee.
What are closing costs?
Closing costs are any fees paid when finalizing the purchase or sale of your property. They can include a wide range of fees, such as property taxes or insurance; most are standard for homeowners and sellers. Others, like transfer taxes, will vary depending on where your home is located when it sells.
Mortgage/Loan payoff amount
When selling your home, you must pay off your mortgage. This “loan payoff amount” includes the remaining principal balance and any accrued interest over the life of the loan. Knowing the full scope of your payoff amount ensures you know precisely what needs to be settled to finalize the loan terms.
Property taxes
According to WalletHub, New Mexico ranks 18th in the country in terms of property taxes, playing it above states like Florida.
Real estate in New Mexico is taxed at a rate of 0.74%, with a median home value in the state of $216,000.
To get a better idea of what you might owe, consult a property tax calculator.
Reconveyance fee
Once you’ve finalized the sale of your home and your mortgage is paid off, you’ll usually be responsible for a reconveyance fee. This fee covers the issuance of a reconveyance deed, which releases you from your debt. Your mortgage company will have to record the deed, and the fee will depend on the city, state, or county where you are located.
Realty transfer tax
You might also be responsible for a realty transfer tax. These fees are assessed by local governments whenever a property changes ownership.
New Mexico, however, does not have a transfer tax.
Real estate agent commission
Unless you’re selling your home for sale-by-owner, you’ll likely have used a local agent. Research indicates that an agent’s expertise can significantly impact your sale: In 2023, homes sold with an agent’s assistance had a median price of $405,000, compared to $310,000 for FSBO sellers.
Working with a real estate agent means paying a commission. This fee covers various services, such as accurately pricing your home, marketing it effectively, and negotiating with buyers to ensure you receive the best possible price and terms.
It should be noted, however, that on March 15, 2024, the National Association of Realtors (NAR) announced a landmark lawsuit settlement that will change the way real estate agent commissions are handled in the future. These changes will “decouple” seller and buyer agent compensation. Industry experts predict that this decoupling will likely lower agent fees and give buyers the ability to negotiate commission amounts directly. Learn more.
HomeLight’s transaction data reveals that the national average real estate agent commission is 5.8% of the property sales price. This commission typically includes fees for both the listing and buyer’s agents, with sellers customarily covering the cost.
Use HomeLight’s commission calculator by entering your city for commission data tailored to your specific area.
Attorney Fees
Some states require an attorney to be present when closing the sale of a property.
In New Mexico, real estate attorneys are not essential for closing, but your agent may advise hiring one anyway.
Homeowners Association/Condo Fees
One of the biggest sticking points for sellers is the fees levied by their homeowners’ association (HOA) or condominium association fees. In New Mexico, the average monthly HOA fee is $386.
Like other fees we’ve discussed, these will vary, not just because of the different rules and regulations of your local HOA but also because HOA regulations vary greatly depending on the state. These fees (or dues) are usually prorated at the time of the sale.
Seller’s concessions
Sellers might owe money at closing due to financing concessions agreed upon during negotiations. These often include cash for closing costs, repairs, and home warranties. A common seller concession is repair credits, sometimes used when a buyer has a contingency in their offer, typically related to home inspection. Instead of making the repairs, sellers can offer repair credits to the buyer at closing.
Miscellaneous closing costs/fees
These are some of the most common closing costs you’ll encounter as a seller in New Mexico. However, it’s important to remember that many closing costs are negotiable. Your buyer may be willing to negotiate on some of these costs, or a real estate attorney or agent may help you get a better deal.
HomeLight can connect you with a top local agent to ensure you pay for the least closing costs possible without jeopardizing your sale. Or, if you prefer to avoid the hassle of dealing with an agent or managing closing costs, consider HomeLight’s Simple Sale program.
We make selling your home easy in just three steps. Just enter some basic information about your home, speak with one of our Home Consultants, and you can sell your home in as little as 10 days.
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