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ICBA/NM's member banks are headquartered in communities all across our state. Over the course of several years, she took out five separate installment loans, all at triple-digit interest rates.Welcome to the Independent Community Bankers Association of New Mexico!Ĭommunity banking is not just about the consumer choice, it's a spirit that drives our entire industry. We’ll call her Sandra. With no savings, battling cancer, and living on Social Security, Sandra turned to storefront lenders to meet expenses. “I lost my husband of 32 years, and I had two grandchildren living with us, and there was no life insurance,” says a retired Santa Fe woman who asked that her name not be disclosed. New Mexico Legal Aid intervened, and the case was eventually dropped. Peters defaulted on the loan, The Cash Store took her to court. Peters fell behind on payments, The Cash Store withdrew the money directly from her checking account, eventually draining it. “Having to pay every pay period, it’s like, oh, my gosh,” Felyne Peters says.Īfter Ms. In need of cash to pay bills, she borrowed $565 from The Cash Store in Gallup at an interest rate of 174.78%. So I would try the loan companies,” says Felyne Peters in Gallup.

Regional finance farmington nm how to#

“I didn’t know how to get extra money right away. In 2019, storefront lenders repossessed 2,293 vehicles after borrowers defaulted on high-interest loans. “The financial harm is well documented in terms of people who lose their cars, are unable to pay off debt, end up defaulting, can’t pay their rent because they’re in so much debt,” Karen Meyers said. But then when they get home and see the reality of the payments, they realize they haven’t been helped,” Winona Nava says. And when people leave there, they feel like they’ve been helped. The people that work there are very nice. “(Consumers) see (storefront lenders) as easy. “It’s really a terrible situation,” Guadalupe Credit Union (Santa Fe) CEO Winona Nava says. Story continues below Larry Barker Investigation: Where New Mexico’s Installment Loan Companies are Headquartered “Last year, there was approximately $220,000,000 in fees paid by New Mexicans for these kinds of loans,” Meyers said. So much of the money that is taken from New Mexicans leaves the state,” attorney Karen Meyers says. “Interestingly enough, 85 percent of (storefront lenders) are out-of-state corporations. In 2019, New Mexico’s storefront lending industry wrote installment loans totaling $660,000,000. The downside, however, is unaffordable payments. Many do not qualify for conventional bank loans. It’s an industry that appeals to families who may have bad credit and need access to ready cash. Every year tens of thousands of New Mexicans end up with short-term installment loans at astronomic interest rates. So now we have to just surrender it to them because we can’t afford that payment,” Rebecca says. “We’re going to have to just give them the vehicle. “On a $3,500 loan, we’re going to be paying back $11,445.” Only after signing the papers did Rebecca realize she couldn’t afford the payments. “It was very enticing … It’s like, yes, this is the answer to our prayers,” Rebecca said. Using the title of her car as collateral, Rebecca was loaned $3,500 at 155% interest. In order to secure emergency cash, she sought out a Farmington storefront lender. “We needed to pay for our rent, our utilities, and also help my mom, who lives (on the Navajo Reservation),” Rebecca said. After her husband got laid off due to COVID-19, her family faced a financial crisis. She lives just off the Navajo Reservation near Farmington.

“It’s absolutely devastating,” says a Northern New Mexico woman who asked that her name not be disclosed. “No one should have to pay triple-digit interest rates on a loan,” says New Mexico Center on Law and Poverty attorney Lindsay Cutler. “There are no policy reasons that support continuing to charge unfair, unaffordable, and exploitive loans,” Meyers said.

Meyers headed up Attorney General Gary King’s Consumer Division. I think it’s outrageous,” says Albuquerque attorney Karen Meyers. Every year, more than 200,000 New Mexicans take out short-term installment loans at exorbitant interest rates, as high as 175%. We’re talking about the storefront installment loan business. Yet in New Mexico, there’s a thriving industry that’s legally cashing in on hundreds of millions of dollars. NEW MEXICO (KRQE) – It’s the kind of transaction you would expect to make in a back alley late at night.