Payday loan companies are subject to New Mexico's cash advance loan laws, which were enacted in 2001, and the state's small loan act. Each lender must furnish their clients with a written contract that is clear and easy to understand. The agreement must inform borrowers that lenders are prohibited from instituting criminal proceedings against defaulting customers who, due to insufficient funds, cannot repay their loans. Under New Mexico law, payday loan businesses must post a sign that reads: “Warning: fees and interest charged on payday loans made at this institution are higher than those charged at other financial institutions.” The minimal cash advance amount that a borrower can request in New Mexico is $50.
New Mexico does not allow payday loan companies to issue loans in an amount greater than 25% of the borrower's net monthly income.
New Mexico does not specify loan terms.
New Mexico does not specify the number of extensions or rollovers that a borrower can request.
Under New Mexico law, cash advance creditors can charge any fee or interest rate that borrowers are willing to pay. For instance, there is no finance fee restriction for a two-week loan in the amount of $100. Additionally, payday loan companies may charge an administrative fee in an amount not exceeding $15.50 per $100 of the loan's principal.
There is no limit on the APR for a two-week loan in the amount of $100.