Bill capping small loan interest rates signed by the governor

SANTA FE—After years of hard work by advocates and community members fighting for fair credit for all New Mexicans, a bill requiring a 36% APR cap on storefront loans passed was signed by Governor Michelle Lujan Grisham today.

“For years so many advocates and community members have fought for a fair and affordable interest rate cap. New Mexican families who’ve experienced crushing financial hardships because of predatory loans have come forward to tell their stories and the stories of their communities over and over, year after year. Today all that hard work has paid off.” said Lindsay Cutler, an attorney with the New Mexico Center on Law and Poverty. “We are incredibly grateful to the leadership of the sponsors of HB 132, and to the governor for signing this important legislation for New Mexico families.” 

The law goes into effect January 1, 2023.

65% of lenders in New Mexico are located within 15 miles of Tribal lands. In McKinley County alone, there are more than 40 storefront lenders that made 69,618 loans in 2020 – nearly one loan for every resident. The Navajo Nation President and Council have expressed their strong support for a 36% cap.

New Mexico currently has one of the highest interest rate caps on installment loans in the country. Lenders across the state are taking advantage of triple-digit interest rates and draining hundreds of millions of dollars from hardworking New Mexicans each year. A family who borrows a storefront loan for just a few hundred dollars at the current rate cap of 175% APR will end up paying hundreds, even thousands of dollars in interest and fees.

Action Alert: Key legislation awaits the governor’s signature. You can help!

Your dedication and countless phone calls, emails, and comments in hearings worked! Huge efforts to stop predatory lending by capping interest rates on small loans, parity for Native language teachers, access to state services in languages other than English, and easy enrollment in healthcare could be a reality for New Mexico’s families. 

We need your help to get these bills signed and over the finish line! Gov. Michelle Lujan Grisham has until March 9 to sign legislation.

Please contact the governor this week by calling her office at (505) 476-2200 and leave a message with her office to “Please sign HB 22, HB 60, HB 95, and HB 132.” You can also email her using this form: https://www.governor.state.nm.us/contact-the-governor/.

Bills awaiting signature: 

HB 22: Limited English Access to State Programs requires state agencies to develop plans to provide help in languages other than English, ensuring that more New Mexicans can access state services. 

HB 60: Native American Language Certificate Salaries ensures that Native language teachers are treated fairly, on par with other teachers, promoting language preservation and student educational success.

HB 95 Easy Enrollment Act allows uninsured residents  to use their state income tax returns as an easy way to get information on available health coverage plans and to enroll in any plans they are eligible for. 

HB 132: Interest Rates for Certain Loans requires an all-inclusive 36% APR cap on storefront loans and ensures that New Mexico’s laws prevent abusive and predatory financial practices. 

Thank you for your tireless efforts! Let’s get the bills passed made into law.

Bill capping small loan interest rates passes the Legislature

Bill awaits the governor’s signature

SANTA FE—After years of hard work by advocates and community members fighting for fair credit for all New Mexicans, a bill requiring an all-inclusive 36% APR cap on storefront loans passed the Legislature today.

House Bill 132 passed the House by a vote of 51 to 18. It passed the Senate by a vote of 19 to eight.

“For decades New Mexico has allowed huge out-of-state companies to charge hundreds of millions of dollars in interest, specifically targeting our native communities, but thanks to the hard work of so many partners, of the sponsors, and of the Legislature, we may finally pass real consumer protections for our people,” said Austin Weahkee from NM Native Vote. 

Governor Lujan Grisham has issued an executive message and it is expected that she will sign the bill. If the bill is signed into law, it will go into effect on January 1, 2023.

“A fair interest rate cap for all New Mexicans has been a long time coming,” said Lindsay Cutler, an attorney with the New Mexico Center on Law and Poverty. “We are incredibly grateful to the leadership of the sponsors of HB 132, Representatives Herrera, Garratt, Anderson, Ely and Speaker Egolf, as well as Senators Duhigg and Soules for their hard work to get the bill through the legislative process. For years so many advocates and community members have fought for this day. New Mexican families who’ve experienced crushing financial hardships because of predatory loans have come forward to tell their stories and the stories of their communities over and over, year after year. Today all that hard work has paid off.” 

65% of lenders in New Mexico are located within 15 miles of Tribal lands. In McKinley County alone, there are more than 40 storefront lenders that made 69,618 loans in 2020 – nearly one loan for every resident. The Navajo Nation President and Council have expressed their strong support for a 36% cap.

New Mexico currently has one of the highest interest rate caps on installment loans in the country. Lenders across the state are taking advantage of triple-digit interest rates and draining hundreds of millions of dollars from hardworking New Mexicans each year. A family who borrows a storefront loan for just a few hundred dollars at the current rate cap of 175% APR will end up paying hundreds, even thousands of dollars in interest and fees.  

“No one should be allowed to charge triple-digit interest rates,” said Ona Porter, Founder Emerita of Prosperity Works. “No one should have to choose between paying their rent and making payments on a triple-digit loan that often keeps them trapped endlessly. New Mexicans deserve access to fair and responsible credit.”

TOMORROW: Support a 36% APR rate cap on storefront loans!

New Mexicans Deserve Fair Credit!

We need your help to get a bill requiring an all-inclusive 36% APR cap on storefront loans passed by the House Judiciary Committee TOMORROW at 1:30 p.m. 

Please attend the hearing and give public comment to ensure that New Mexico’s laws prevent abusive and predatory financial practices.

New Mexico has one of the highest interest rate caps on installment loans in the country. Lenders across the state are taking advantage of triple-digit interest rates and draining hundreds of millions of dollars from hardworking New Mexicans each year. A family who borrows a storefront loan for just a few hundred dollars at the current rate cap of 175% APR will end up paying hundreds, even thousands of dollars in interest and fees.  

You might share a personal story with legislators about why no one should be allowed to charge triple-digit interest rates. You might also share why you support the bill. For example: “I urge the Committee to support House Bill 132 for an all-inclusive 36% cap on storefront loans. No one should have to choose between paying their rent and making payments on a triple-digit loan. New Mexicans deserve access to fair and responsible credit.”

HB 132 Summary
House Bill 132, sponsored by Representatives Herrera, Garratt, Anderson, Ely and Speaker Egolf would require an all-inclusive 36% APR cap on storefront loans and ensure that New Mexico’s laws prevent abusive and predatory financial practices. 

Public Comment Instructions

When: Tomorrow February 2 at 1:30 p.m.

How: Zoom link will become available before the hearing on the House Committee Schedule page https://www.nmlegis.gov/Calendar/Session

What to Expect During the Hearing

The committee will be taking public comment. The chair of the committee will announce the bill and ask who supports HB 132. At that time, to provide a comment use the Zoom reaction button and raise your hand. The chair will call your name and unmute your zoom when it is your turn to speak.

Tips

  • Keep your remarks brief and to the point.
  • If you have a personal story about high interest loans, please share it.
  • Close the Legislature’s webcast page when you give your comment so there is not an echo during your remarks.
  • Make sure you are not muted when it is your turn to speak.
  • Do not rely on your phone or computer for notes. Write them down on a piece of paper or print them out in case your computer or phone freeze.
  • Close other tabs and windows in your browser to make sure your connection is good.
  • If your microphone or internet connection doesn’t work then be prepared to call in on your phone using the number at the same link above.

New! Financial Resource Guide During COVID-19

The pandemic and economic crisis have created financial hardships for many New Mexicans. Many families have had difficulty accessing the financial resources available to help meet basic needs. In response, we have created the Financial Resource Guide During COVID-19.

The guide is  a comprehensive source of information about assistance—and New Mexicans’ rights to access it—available across the state now and in the future.

The guide includes information about programs funded through federal legislation like the American Recovery Plan Act, the Coronavirus Aid, Relief, and Economic Security Act, as well as long-standing state and local programs that can help families with food, housing, healthcare, child care, and more.

Access the resource guide here: http://nmpovertylaw.org/wp-content/uploads/2021/07/NMCLP-COVID-Guide.pdf

Expect the Spanish language version soon!

Action Alert: Support legislation to strengthen housing stability in NM!

All New Mexicans need access to housing

On Monday at 1:30 p.m., the Legislature’s House Judiciary Committee will consider House Bill 111, which would modernize our housing laws to strengthen housing stability, reduce barriers to housing, and establish a statewide entity for housing policy.

We need your help to provide public comment at the hearing in support of this bill!

New Mexico was already in a housing crisis before the onset of the COVID-19 pandemic. Unless we take action now, there will be a tidal wave of evictions as soon as the public health emergency ends, threatening our health and economic recovery as a state.

New Mexico has some of the shortest eviction time frames in the U.S.—often too short to access rental assistance, resulting in tenants being evicted and landlords losing income even when rental relief is available. Other tenants face discrimination or even eviction when landlords reject rental assistance or other lawful sources of income used to pay rent.

HB 111 would stop this discrimination and expand the eviction timeframes to allow tenants to get caught up on their rent and stay in their homes.

Instructions:

When: 1:30 p.m., Monday, February 15

How to join: Please click the link below to join the webinar: https://us02web.zoom.us/j/89543370073 Or iPhone one-tap : US: +16699009128,,89543370073# or +12532158782,,89543370073# Or Telephone: Dial(for higher quality, dial a number based on your current location): US: +1 669 900 9128 or +1 253 215 8782 or +1 346 248 7799 or +1 646 558 8656 or +1 301 715 8592 or +1 312 626 6799 Webinar ID: 895 4337 0073

What to expect during the hearing: The committee will be taking public comment. The chair of the committee (Gail Chasey) will announce the bill and ask who supports HB 111. At that time, to provide a comment use the Zoom reaction button and raise your hand. The Chair will call your name and unmute your zoom when it is your turn to speak.

HB 111 summary: http://nmpovertylaw.org/wp-content/uploads/2021/02/Factsheet-2.pdf
House Bill 111 modernizes the New Mexico housing code by: 1) improving the balance between the rights of landlords and the rights of tenants, so families who can pay rent and comply with their lease are not evicted, 2) reducing barriers to housing for New Mexicans using housing vouchers and other lawful sources of income such as social security income to pay rent, and 3) creating a statewide housing council to address housing policy and coordinate state resources directed to addressing housing in New Mexico.

Tips for public comment:

  • Keep your remarks brief and to the point. 
  • If you have a personal story about being unable to access housing because you pay rent with a voucher or other source of income that doesn’t come from a job, or you have a personal story about being evicted because you were temporarily behind on rent, please share it.
  • When you login to Zoom, please rename yourself with your full name so the moderator can find you easily.
  • Make sure you are not muted when you start speaking.
  • Do not rely on your computer or phone for notes. Write them down or print them, just in case your computer screen freezes.
  • Close other tabs and windows in your browser to make sure your connection is good.
  • If your connection or microphone doesn’t work, be prepared to call in with the information above.

All New Mexicans deserve access to fair loans.

With your support, Senate Bill 66 passed the Senate Tax, Business and Transportation Committee! The bill would require an all-inclusive 36% APR cap in New Mexico. We need your help to get it through the Senate Judiciary Committee hearing on Monday at 1:30 p.m.

New Mexico has one of the highest interest rate caps in the country. Lenders across the state are making loans with annual interest rates of 175% APR. A family who borrows a storefront loan for just a few hundred dollars will end up paying hundreds, even thousands of dollars in interest and fees.

It’s time for New Mexico to have a 36% APR cap to ensure all New Mexicans have access to fair and affordable loans. Please call or email members of the committee TODAY and urge them to support an all-inclusive 36% cap.

You might share a personal story with legislators about why no one should be allowed to charge triple-digit interest rates. You might also share why you support the bill. For example: “I urge the Senator to support SB 66 for an all-inclusive 36% cap on storefront loans. No one should have to choose between paying their rent and making payments on a triple-digit loan. All New Mexicans deserve access to fair and responsible credit.”

You may also comment during the online hearing MONDAY at 1:30 p.m. To comment, send an email to SJC@nmlegis.gov with your name, whether you are in support or against, and whether you would like to give public comment by Sunday, February 14 at 5:00 p.m. If you wish to provide written comments, keep them to 300 words or less. You will be contacted by the Zoom Operator with the virtual meeting instructions.

Contact information for the senators is below.

Sincerely,
Lindsay Cutler

Senate Judiciary Committee

  • Senator Joseph Cervantes (Chair): (505) 397-8820; joseph.cervantes@nmlegis.gov
  • Senator Bill O’Neill (Vice Chair): (505) 397-8838; oneillsd13@billoneillfornm.com
  • Senator Cliff Pirtle: (505) 986-4369; cliff.pirtle@nmlegis.gov
  • Senator Gregory A. Baca: (505) 986-4877; greg.baca@nmlegis.gov
  • Senator Katy Duhigg (co-sponsor of SB 66): (505) 397-8823; katy.duhigg@nmlegis.gov
  • Senator Daniel Ivey-Soto: (505) 397-8830; daniel.ivey-soto@nmlegis.gov
  • Senator Linda Lopez: (505) 397-8833; linda.lopez@nmlegis.gov
  • Senator Mark Moores: (505) 986-4856; mark.moores@nmlegis.gov
  • Senator Mimi Stewart: (505) 397-8853; mimi.stewart@nmlegis.gov

Mobile home park residents fight illegal fines and eviction

Residents file class action lawsuit in Second Judicial Court

ALBUQUERQUE—Residents of Aztec Village, a mobile home park in Albuquerque, came together for fairness and dignity in their community today and sued the corporate landlord and manager of the park where their homes are located. The residents charge that Nodel Parks LLC—which owns mobile home parks throughout the country, including six in Albuquerque—and park manager Magdalena Vila illegally and arbitrarily fined them for alleged infractions of community rules and threatened them with eviction when they couldn’t pay. 

The plaintiffs in the class action lawsuit Chavez v. Nodel Parks, LLC  are represented by the New Mexico Center on Law and Poverty and Parnall and Adams Law. The lawsuit was filed in Second Judicial District Court in Albuquerque today.

“Really, the people who live here, we are like family,” said Marlena Martinez, a longtime Aztec Village resident who helped organize residents to fight the park’s unfair practices. “Over 100 families live here, and some of us have been here for over 40 years. It’s an understatement to say that we are invested in our community. Ever since management began unfairly fining us and forcing people out of the community, we have been fighting together for our homes, our financial stability, and to stay together.”

Nodel Parks changed management of Aztec Village in May of 2019 and soon began issuing fines for violations of what the manager said were community rules. However, many of the alleged violations residents were fined for, including disposing of leaves in community dumpsters and having child toys in the front yard, were not actual violations of Aztec Village’s rules. 

Rather, the rules and fines enforced by Nodel Parks are arbitrary decisions that the lawsuit claims are used to intimidate and coerce payment from residents in violation of state law. Residents informed Nodel Parks of the problems, but upper management refused to take any action. As a result, residents are forced to pay the illegal fines and are in danger of losing their homes when they cannot pay. 

The lawsuit comes at a time when New Mexico faces a severe housing crisis. The Housing and Urban Development Department found that the state topped the nation with a rise in homelessness with a 27% increase from 2018 to 2019. Homelessness in Albuquerque alone, rose by 15%.

Mobile homes are the single greatest source of affordable housing stock in the United States.

“Landlords must follow the law and treat residents with respect. There are hundreds of communities like Aztec Park across the state, and unfair policies and practices like these push hard working New Mexican families out of their communities and onto the streets,” said Maria Griego, supervising attorney at the New Mexico Center on Law and Poverty. “When you own your home but rent the land it’s on, you are at particular risk of unfair and predatory practices by landlords. For this very reason, the New Mexico Legislature enacted the New Mexico Mobile Home Park Act to protect mobile home park residents.”

The state Mobile Home Park Act requires mobile home park owners to publish and enforce community rules only after soliciting comments from the community and posting responses. The law prohibits mobile home park owners from charging fines for violations of community rules and/or rental agreements. Instead, the law requires notice and an opportunity to rectify a violation. 

The families are asking the court to order defendants to stop:

  • Issuing fines for alleged or actual violations of rental agreements and/or the community rules and regulations;
  • Sending notices that threaten to evict or take further action against tenants if they don’t pay the fines; 
  • Rejecting rent from tenants if the total amount does not include any fines assessed against the tenant. 

The families are also asking the court to require the defendants to pay money damages for each instance in which the park management violated New Mexico law.

“I’m a homeowner just like any other and deserve to be treated fairly and with respect,” said Martinez.  “We are not going to let them get away with tearing our communities apart and cheating us out of our homes.”

Attorneys on the lawsuit Chavez v. Nodel Parks, LLC, include Maria Griego, Lindsay Cutler, and Sovereign Hager from the New Mexico Center on Law and Poverty and David Adams and Charles Parnall from Parnall and Adams Law.

The complaint can be found here: http://nmpovertylaw.org/complaint-chavez-v-nodel-parks-llc-01-30-2020/

The exhibits can be found here: http://nmpovertylaw.org/exhibits-chavez-v-nodel-parks-2020-01-30/

ACTION ALERT: Stop the Trump administration from allowing predatory lenders to target low-income families

The federal Consumer Financial Protection Bureau was created to protect people from predatory lending practices. However, under the Trump administration, the CFPB is now proposing to gut important consumer protections from the 2017 Payday Loan Rule, putting the interests of unscrupulous lenders over our families.

Please tell the Trump administration not to repeal regulations that protect low-income borrowers!  

In 2017, after conducting extensive research on storefront loans and payday lending, the CFPB finalized regulations to protect people from some of the worst predatory lending practices. The 2017 Payday Rule, scheduled to go into effect this August, mandates that lenders assess a borrower’s ability to repay a loan as a condition of making high cost title and payday loans.

Trump’s CFPB is proposing to revoke this protection that requires lenders to only provide loans that can be repaid, prioritizing the profits of payday and car title lenders over the consumers the agency was created to protect.

The storefront lending industry is built on making loans that borrowers cannot afford to repay. Payday lenders encourage borrowers to rollover their loans and take on more debt when they cannot make payments.

The debt trap is still common in New Mexico even though the state no longer permits short term loans. Instead, in our state lenders trap families in longer term debt at rates as high as 175% APR. Many payday lenders are national corporations that do business in New Mexico.

The 2017 Payday Rule should be implemented as it was originally written.

Protect the rights of consumers to fair loans by submitting your public comment! 

Information on submitting your comments and suggested content is below. 

Submit your comment here: https://www.federalregister.gov/documents/2019/02/14/2019-01906/payday-vehicle-title-and-certain-high-cost-installment-loans’

The deadline is May 15, 2019. 

To maximize its impact, make sure at least a third of your comment is original text; otherwise, the CFPB might not consider it a valid comment. It is most important to note how high cost loans are harmful in our state, even if your comment is very brief. 

Content to consider in your comment: 

The 2017 CFPB Payday Rule is vital in stopping the debt trap of payday lending.

  • Requiring payday and car title lenders to assess whether customers can afford to pay loans back before entering into a contract is a commonsense foundation of responsible lending.
  • Payday lenders will stop at nothing to prevent this reasonable requirement because they want to perpetuate their business model that is driven by trapping people in longterm debt. 
  • The CFPB says that repealing the Payday Rule will be a “benefit” to payday lenders, but it will directly harm consumers who are stuck with unaffordable loans.
  • Rescinding the 2017 Payday Rule ignores extensive public comment and a wealth of research on the dangers of unregulated payday borrowing conducted by the CFPB itself.
  • The debt burden of payday loans forces families to choose between paying their bills or face ever-growing fees including overdraft fees, closed bank accounts, and even bankruptcy.
  • For car title loan borrowers, there is a huge risk that a family will lose their vehicle – frequently a low-income household’s sole means of getting to work, school, or medical appointments.

The proposal will hurt low-income borrowers.

  • In name, payday loans are not allowed in New Mexico. In reality, longer term installment loan products have taken their place, extracting just as many resources from cash-strapped families regardless of what they can afford.
  • Most storefront lenders in New Mexico operate in multiple states. Allowing the 2017 Final Rule to go into effect as planned will create a norm for the storefront lending industry that will help New Mexicans who take out loans from multi-state lenders and could support the development of similar consumer protections in New Mexico state law.

The CFPB should both implement the 2017 Payday Rule, and also study the impact of similar protections on longer-term loans to protect consumers across the country from predatory debt trap practices.

Legislative Wrap Up 2019

Dear friends,

This legislative session was a turning point for New Mexico. The efforts of the Center on Law and Poverty and our partners paved the way for historic changes for our state and started long overdue dialogue about the bold changes that must be made for children and families. This could not have happened without you! THANK YOU for the countless phone calls, emails to your legislators, testimony in committee hearings, and sharing of information with your networks and through social media.

We have much to celebrate together and are especially proud to share several major victories.

Our advocacy efforts and expert testimony were instrumental in achieving:

Historic wins for workers in New Mexico
Domestic and home care workers are now protected by basic labor laws. Along with our partners, we successfully eliminated outdated, discriminatory practices in our state so people doing some of the toughest jobs, like caring for others’ loved ones and cleaning houses, are protected by New Mexico’s minimum wage standards and other wage protections.

After a decade of stagnant wages, hard working New Mexicans will finally get a raise. Hundreds of workers from across New Mexico mobilized in support of a wage increase this session. It was a long and challenging fight, but starting in January 2020, the state minimum wage will be raised to $9 an hour and increase annually until reaching $12 an hour in 2023. This will directly impact 150,901 workers in our state—nearly 20 percent of the workforce.

Loopholes closed in small loans laws
Everyone should be able to understand the terms of their loans, especially when these loans are taken out from storefront lenders. Our advocacy with our partners led to significantly more accountability and transparency by mandating that lenders report relevant data to the state and by aligning our small loan laws so all New Mexico families receive fairer loans.

Public education a top priority
After winning the Yazzie/Martinez court ruling on behalf of families and school districts, we joined with education, tribal and community leaders, and students to form the Transform Education NM coalition and used this historic opportunity to bring education to the forefront this legislative session. New Mexico’s education system must be rooted in a multicultural framework for our diverse student body, and our coalition won much needed funding for culturally and linguistically responsive instruction in rural areas. Overall, New Mexico saw an increase in education funding, and teachers got long overdue raises. However, we still have a long way to go, and we will not stop until every child has the education they need to succeed and are entitled to by the New Mexico Constitution. 

Progress toward innovative and affordable health coverage
Dozens of families, healthcare professionals, and advocates joined the NM Together for Healthcare campaign to work tirelessly for a Medicaid Buy-in option for New Mexicans who struggle to afford the outrageous costs of private insurance but don’t qualify for Medicaid. The Human Services Department will now receive funding to further study and begin the administrative development of a public option plan, including pursuing federal funding to help pay for it.

The path ahead
We’re focused on New Mexico’s future, and together with you, we will continue to push for complete transformation of our education system, expansion of early childhood education—including pre-K, childcare assistance and home visiting services—better pay and working conditions for workers, financial and food security, and access to healthcare for all of our families.

Sincerely,

Sireesha Manne                                                  
Executive Director