Dist. 43 Rep. Christine Chandler
STATE News:
SANTA FE – HB 386, Installment and Small-load Maximum Interest, sponsored by Dist. 43 Rep. Christine Chandler of Los Alamos, together with Rep. Susan Herrera and Rep. Patricia Roybal Caballero passed its first committee Friday.
The bill caps so-called “payday” lending at 36 percent; currently payday lenders can charge up to 175 percent interest. After the House Labor, Veterans and Military Affairs committee, the bill will move onto House Judiciary.
Several organizations have been actively working to pass a 36 percent cap for several years in the legislature arguing that the small loans are targeting vulnerable New Mexicans who become entrapped by high compounding interest.
In 2016, Pew Research showed that the average “payday” lending customer pays out an average of $520 for an average of $375 in borrowed money to cover unexpected expenses.
More than 80 percent of payday lending customers have to immediately borrow the money they just paid off due to high fees eating into their ability to pay basic expenses.
“We have taken a first step in stopping payday lenders who prey on New Mexicans with the least amount of resources,” Rep. Chandler said. “While 36 percent is still high, the cap will prevent the outrageous and insurmountable interest rates favored by an industry designed to keep working families trapped in debt.”
Rep. Chandler can be reached during the session in her office in Room 203B, by phone at 505.986-4226 or email christine.chandler@nmlegis.gov. Join her email list at www.Christine4StateHouse.com to keep up to date.
