Home Inverness Colorado Income New Mexico Enacts New Laws Affecting Payday Lenders, Check Cashing Service Providers, and Enforcement of Service / Guarantee Contracts

New Mexico Enacts New Laws Affecting Payday Lenders, Check Cashing Service Providers, and Enforcement of Service / Guarantee Contracts

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On April 6, New Mexico adopted HB 347, a bill to amend the New Mexico Small Loans Act of 1955 (NMSLA) and the Bank Installment Loans Act of 1959 (NMILA) to effectively eliminate “payday loans” in the state by requiring that loans of $ 5,000 or less be made in accordance with the NMSLA or NMILA. Specifically, the new law caps the annual percentage rate for these loans at 175% and requires lenders operating in New Mexico to provide loan terms of at least 120 days and a minimum repayment schedule of four installments of amounts. substantially equal. The new law also limits the fees and charges that a lender can assess in connection with loans made under the NMSLA or NMILA, as well as the number of times a lender can present a check or other debit for payment. In addition, lenders are prohibited from making loans under the NMSLA or NMILA if the consumer has not repaid any loans previously obtained under these laws, and all lenders must report the terms of such loans. to consumer rating agencies. In particular, these new requirements do not apply depository institutions insured by the federal government. In addition, HB 347, which comes into force on January 1, 2018, will be applied exclusively by the state. Counties, municipalities and other political subdivisions of the state are excluded from any regulation of the terms and conditions regarding these loans, whether by ordinance, resolution or otherwise. A violation of the NMSLA or the NMILA will constitute an unfair or deceptive trade practice under the New Mexico Unfair Practices Act.

Also on April 6, Governor Susana Martinez sign place SB 220, a bill that amends the Service Contracts Regulation Act by adding and amending definitions; provide security by means of insurance policies; and provide specific information to be included in contracts and guarantees. Specifically, the changes, which are expected to take effect on June 16, allow providers to obtain a reimbursement insurance policy instead of keeping a deposit with the Superintendent of Insurance. On the same day, Governor Martinez also adopted HB 276, a bill that raised the income threshold from $ 500 to $ 2,500 within a 30-day period that triggers New Mexico’s Uniform Money Services Act license requirement for check cashing businesses. HB 276 is expected to come into effect on July 1.