New Mexico Senate Passes 36% Rate Cap on Installment, Title Loans
The New Mexico state Senate passed legislation creating a 36% rate cap on short term installment and car title loans. Now, the bill moves to the House, where consumer advocates hope it will find strong support.
According to the Center for Responsible Lending, the current maximum interest rate on these types of loans in New Mexico is 175%.
Gov. Michelle Lujan Grisham cheered the Senate passage of the bill with a tweet, noting, “This legislation will protect New Mexico families and help ensure hard-working New Mexicans are not taken advantage of.”
An investigative report from tv station KRQE details the horrors of high interest installment lending in New Mexico.
It’s the kind of transaction you would expect to make in a back alley late at night. Yet in New Mexico, there’s a thriving industry that’s legally cashing in on hundreds of millions of dollars. We’re talking about the storefront installment loan business. Every year, more than 200,000 New Mexicans take out short-term installment loans at exorbitant interest rates, as high as 175%.
“It’s a very serious threat. I think it’s outrageous,” says Albuquerque attorney Karen Meyers. Meyers headed up Attorney General Gary King’s Consumer Division. “There are no policy reasons that…
