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HomeForward Second Mortgage Loan

Statewide, New Mexico

Last verified
See what you qualify forOfficial program site →
Income limit

$268,500

The household income limit the program publishes

Price cap

$798,581

Highest purchase price the program allows

Repayment

Forgivable

Forgiven after 10 years

What is HomeForward Second Mortgage Loan?

HomeForward Second Mortgage Loan is a forgivable loan for homebuyers in Statewide, New Mexico.

  • NM MFA $25,000 fixed-amount 0% deferred forgivable second mortgage; 10-year forgiveness (10% per year of owner occupancy). Paired with HomeForward first mortgage (no FTHB requirement). Highest income / purchase-price tier in NM MFA DPA suite.
  • HomeForward Second Mortgage Loan is NM MFA's higher-income-tier down payment assistance program paired with the HomeForward (non-FTHB) first mortgage. Eligible borrowers receive a $25,000 fixed-amount, 0% interest, deferred-payment second mortgage that is FORGIVABLE over a 10-year affordability covenant. No monthly payments. The $25,000 balance reduces 10% per year of owner occupancy and is fully forgiven after 10 years. Pro-rata recapture applies if home is sold, refinanced, payoff of first mortgage, transferred, or no longer owner-occupied within the 10-year period. HomeForward is open to repeat homebuyers (NOT restricted to first-time homebuyers) and carries the highest income / purchase-price tier in the NM MFA DPA suite.
  • Funding comes from State.

Do you have to pay it back?

HomeForward Second Mortgage Loan is forgiven after 10 years, so a buyer who stays that long does not repay it.

  • Repayment is triggered by Pro-rata balance due on sale, refinance, payoff of first mortgage, transfer of title, or when home is no longer borrower's principal residence within 10-year covenant period. Forgiven 10% per year of owner occupancy and fully forgiven after 10 years.
  • The assistance is recorded in 2nd Lien position.
  • Forgiveness and repayment terms are set by the program and can change — confirm them on the official program page before applying.

Who qualifies?

HomeForward Second Mortgage Loan is open to buyers who will live in the home as their primary residence.

The program requires

  • The home is occupied as a primary residence
  • On credit: 620 minimum representative mid-FICO across all NM MFA programs.
  • A completed homebuyer education course, through NM MFA-approved homebuyer education provider; HUD-approved counseling agencies including Homewise, NeighborWorks Laredo, United South Broadway, Tierra del Sol Housing Corporation, eHome America, or Framework.
  • Residency: Property must be located in New Mexico and serve as borrower's principal residence for the 10-year covenant period.
  • Citizenship or immigration status: U.S. citizen, permanent resident alien, or qualifying non-permanent resident alien per first-mortgage product overlays.
  • Must qualify for and be paired with NM MFA HomeForward first mortgage. First-time homebuyer NOT required. Owner-occupied principal residence. Income within HomeForward higher-tier limits ($121,800 1-2p smallest counties up to $268,500 3+p targeted Los Alamos / Santa Fe County per 2025 NM MFA schedule). Acquisition price within HomeForward limits ($604,703 non-targeted / $798,581 targeted). 620 mid-FICO minimum. 50% maximum DTI. $500 minimum borrower investment (giftable). NM MFA-approved homebuyer education required. 10-year affordability covenant for forgiveness.

The program excludes

  • Purchases above the $798,581 price cap
  • Households above $268,500

These are the program's own published rules, not a decision about any individual — the administering agency and a lender determine who actually qualifies.

What are the income limits?

HomeForward Second Mortgage Loan limits household income to $268,500.

  • The limit applies to total household income, not only the borrower’s.
  • Area median income figures are published by HUD and updated annually, so check the current table for the county before relying on a number.

What kind of home can it be used for?

HomeForward Second Mortgage Loan caps the purchase price at $798,581.

  • Eligible property types include Single-family detached, condominium, townhouse, PUD and manufactured home on permanent foundation per servicer overlays.
  • New construction is eligible.
  • Manufactured homes are eligible.

Is there eligibility for specific groups?

HomeForward Second Mortgage Loan names veterans, active-duty service members, reservists and National Guard members, surviving spouses, and American Indian and Alaska Native buyers among the groups it serves.

  • Being named here means the program mentions the group, not that membership alone qualifies an applicant — the rest of the eligibility rules still apply.

Where does it apply?

HomeForward Second Mortgage Loan serves buyers purchasing in Statewide, New Mexico.

  • The program targets specific areas: Federally designated IRS targeted census tracts where NM MFA applies higher income / purchase price limits.

How do you apply?

Applications for HomeForward Second Mortgage Loan go through the administering agency, which publishes the current terms and the application steps on its own site.

  1. Take a homebuyer education course

    Required by the program, through NM MFA-approved homebuyer education provider; HUD-approved counseling agencies including Homewise, NeighborWorks Laredo, United South Broadway, Tierra del Sol Housing Corporation, eHome America, or Framework..

  2. Contact the administering agency to reserve funds

    Funds are reserved through Reserved by NM MFA-approved participating lender via NM MFA's online lender portal at time of HomeForward first-mortgage rate lock., and are subject to availability.

  3. Work with a lender who handles the program

    Hey Prescott is not a lender and does not accept applications; this page describes the program so a buyer can take it to a lender or housing counselor.

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