N.M. Admin. Code 188.8.131.52 specifies the form to be given to satisfy the notice of rights required by Section 59A-16-14 NMSA 1978, which obligates the lender to inform the borrower that:
…although [the borrower] may be required by the seller or lender to purchase insurance to cover the property that is being used as security for the loan, [the borrower] may purchase that insurance from the insurance company or agent of [the borrower’s] choice, and cannot be required by the seller or lender, as a condition of the sale or loan, to purchase or renew any policy of insurance covering the property through any particular insurance company, agent, solicitor, or broker.
This form exists in Docutech’s library as the NM Freedom to Choose Insurance Company (Cx2794). If the borrower acknowledges the form, but chooses to authorize the lender to purchase the required insurance coverage on their behalf, the lender must provide another form, specified in NMAC 184.108.40.206, which grants the lender permission to obtain insurance on behalf of the borrower. Docutech provides this form as the NM Lender Authorization to Obtain Insurance (Cx2795).
Currently, the NM Lender Authorization to Obtain Insurance (Cx2795) is configured to print along with Cx2794, the NM Freedom to Choose Insurance Company, in all New Mexico Initial Disclosure packages. However, since it is not common practice for the lender to purchase insurance on behalf of the borrower, we are changing the default print configuration of Cx2795 to only print for NM Initial Disclosure packages when Field 81257 “Borrower Will Select Insurance Agent” is set to “No”. Please note that all clients who are currently printing Cx2795 will have the old generic print configuration copied for their institution as a custom configuration, in order to avoid any disruption of the current distribution of Cx2795.
This change will be in effect on June 29, 2017. If you have any questions or concerns about this configuration change, please contact Client Support at 1.800.497.3584.