What New Mexico law says now

Chapter 47, Article 16 NMSA 1978 — the Homeowner Association Act — says nothing at all about transfer fees, capital contributions or resale-transaction charges. There is no cap, no disclosure requirement specific to the charge, and no requirement that the money be used for any particular purpose.

That silence means the charge is governed by the recorded declaration and by general contract principles. If the declaration authorises it, it is owed; if it does not, the association is charging for something its own documents do not permit, which is a question worth asking before closing rather than after.

The federal rule that does apply

One federal constraint operates regardless of state law, and it is more consequential than most New Mexico boards realise. The Federal Housing Finance Agency's private transfer fee covenant regulation, 12 CFR Part 1228, bars Fannie Mae, Freddie Mac and the Federal Home Loan Banks from taking a mortgage on property encumbered by a private transfer fee covenant unless the fee is an “excepted transfer fee covenant” — broadly, one whose proceeds run to a covered association and are used for the direct benefit of the encumbered property.

The practical effect is a financing test rather than a legality test. A transfer fee that funds the association and benefits the property is excepted. A transfer fee that runs to a developer, an investor or a third party is not, and lots subject to it become unfinanceable in the conventional market.

FHFA also repaired that rule this year. A technical amendment published and effective March 17, 2026, 91 FR 12673, reinstated timing and transitional “grandfather” exceptions that had been deleted inadvertently by the agency's 2024 amendments, and did so nunc pro tunc beginning July 16, 2012.² Covenants that were validly grandfathered in 2012 were therefore never un-grandfathered.

What a buyer or seller should actually check

Because there is no statute, the questions are documentary. Which recorded instrument creates the charge, and does it in fact authorise a fee at sale rather than an ordinary assessment? Who receives the money — the association, or someone else? Is the charge disclosed before the purchase agreement is finally accepted, or does it surface on the settlement statement? And is the amount fixed, a percentage of price, or discretionary?

Each of those is a term of the declaration in New Mexico, not a term of the statute, and each is answered by reading the instrument rather than by consulting Chapter 47.

What to watch next

No reporting identifies a 2027 sponsor for a transfer-fee bill, and nothing is prefiled. HB 232 remains the cleanest statement of what a New Mexico ban would have looked like — a one-sentence prohibition with no exceptions, no cap and no carve-out for capital contributions — which is also the reason it would have been a large change, and possibly the reason it never got a hearing.