Online Loans – Loan Interest Rate Cap Bill Does Not Reach the Finish Line »Albuquerque Journal | Zoom Fintech
Loans Online – Loan Interest Rate Cap Bill Does Not Reach the Finish Line »Albuquerque Journal
SANTA FE – Bill to lower New Mexico’s small loan interest rate cap – to 36% from 175% – will not pass through both legislative chambers until the end of the 60-day session Saturday, his sponsor said Friday night.
Senator Bill Soules, D-Las Cruces, said the House and Senate were essentially at an impasse after passing different versions of the loan bill.
As both legislative chambers appointed members to sit on a conference committee to try to find a compromise, Soules said a real conference committee meeting would not take place because House members wanted to negotiate. .
“He’s basically going to die stuck between the two chambers,” Soules told The Journal.
He said that the debate on the issue would continue and expressed his optimism. Governor Michelle Lujan Grisham could add it to the agenda for next year’s 30-day session.
The original version of the bill, Senate Bill 66, limited annual interest rates for storefront loans to 36%. It was passed in the Senate this month by 25 to 14 votes.
But the proposal was changed in the House over fears that the bill would make it impossible for some New Mexicans who need quick access to small amounts of money to get loans.
The House eventually passed a revised version of the bill that included two caps – one of 99% for loans of $ 1,100 or less and one of 36% for larger loans.
“We are disappointed – we thought we had found a good compromise,” said Rep. Susan Herrera, D-Embudo, another sponsor of the bill.
While they disagree on the details, Herrera and Soules also acknowledged the role loan industry lobbyists played in the failure of the original legislation.
Supporters of the original measure had argued that it would protect vulnerable New Mexicans while strengthening the state’s economy by keeping residents out of “debt traps.”
But critics of lowering the maximum annual rate cap for small loans argued that such a policy change could bankrupt many businesses and push borrowers to use internet lenders, many of whom are based in the United States. other countries and cannot be regulated.
This year’s debate at the Roundhouse took place four years after the Legislature passed legislation setting the current ceiling on the small loan interest rate of 175% and banning payday loans with a term of less than 120 days.
The 2017 legislation was presented as a compromise after years of debate on Capitol Hill over payday loans.
But critics have insisted that the 175% cap is too high for low-income New Mexicans, while pointing out that the US military has put in place a 36% annual percentage rate limit for low-income New Mexicans. loans obtained by servicemen on active duty.
“We have to do a better job for New Mexicans,” Herrera said.
Loans Online – Loan Interest Rate Cap Bill Does Not Reach Finish Line »Albuquerque Journal