UNDERSTANDING ONLINE PAYDAY LOANS IN NEW MEXICO
Mexico officially called the United Mexican States lies in the southern portion of North America. It is the fifth largest country in the Americas and 13th largest independent state in the world. The economy of Mexico is the 11th largest in the world. The modern industrial and service sectors are rapidly developing, with increasing private ownership.
PAYDAY LOANS ARE SMALL-TERM LOANS WITH A LOW PRINCIPAL AMOUNT USUALLY GUIDED BY STATE REGULATIONS AND THE MONTHLY SALARY OF THE BORROWER. THE LENDER GIVES THE CASH AMOUNT AS A LOAN TO THE BORROWER WHICH MUST BE PAID BACK ONCE THE BORROWER GETS THEIR SALARY. PAYDAY LOANS SHOULD BE TAKEN OUT ONLY IN CASE OF EMERGENCIES BECAUSE THEY HAVE SOME OF THE HIGHEST INTEREST RATES IN THE FINANCIAL SECTOR.
One of the main advantages of a payday loan in New Mexico is that they it is processed very quickly and the consumer can usually get the cash they need within 24 hours, whereas traditional loans may take a few weeks to process. Good news with this is that people with bad credit can also get these loans, however, all lenders will usually check if you are capable of paying back the amount borrowed along with the finance charges.
These days all countries and states have their own set of legislation to guide payday loans. The Mexico government regulates this industry with a set of rules and regulations through the New Mexico Financial Institutions Division. They describe all the relevant provisions on payday lending in the state. Some of these rules are defined further:
- Loan amount – Maximum loan amount can be 2500$, however, there is no specific minimum limit.
- Tenure – A maximum tenure of 35 days and no limit on minimum tenure.
- Cost – Maximum interest rate of 15.5% and a verification fee of $0.5 for a $100 loan. Example: if you borrow 100$, then you will payback 116$ (15.5% interest – 15.5$ + 0.5$ verification fee).
- Annual Percentage Rate – based on above information the APR on a 14 day $100 loan will amount to around 416%.
- Borrower check – The borrower must be permanently employed or at least have a permanent source of income.
- The Number of loans – There is no specific number of loans permitted, however, the total loan and fees amount should be at 25% of the gross monthly income of the borrower.
- The Number of rollovers – None. If a borrower is unable to repay a loan, lenders cannot renew the repayment period and charge for it.
- Repayment plan – A Repayment plan must be established with the terms of lending. Borrowers must pay the amount in equal installments of 130 day period with no extra charges for it.
- Cool off period – There is a cool off period of 10 days after the repayment of a loan.
- Non-Sufficient Funds – If a consumer does not have sufficient funds in their account, the lender may charge a 15$ one-time fee per loan. Lenders cannot initiate any criminal action against the borrower in case of default.
Consumers should be aware that payday lending is legal in the state of New Mexico. If any lender is not complying with the rules stated above the borrower must contact and inform The New Mexico Financial Institutions Division. Consumers should understand the rules and regulations behind these loans, by gaining this knowledge of the process, local laws and regulations, pros and cons, the consumers can protect themselves and get the best out of these short-term loans.
There are various lenders available in New Mexico, we have listed some of them for you below:
- Check into cash – Direct Lenders, online and store.
- Ace cash express payday loans – Quick payday loans.
- Bad credit loans – For borrowers with bad credit history.
There are many options available in the market so you should compare and pick one that suits your needs.