This article will discuss the case which made the NM Governor signs payday lenders bill. This act happened on March 30, 2007. This act was an update on the law which regulates the policy on how payday loans work around the state of New Mexico. It had been years since the state had no certain laws to regulate the payday lenders. Well, let us check this case out, shall we?
Governor signed Payday Lenders Bill
Eleven years ago, former governor of the state of the New Mexico, Bill Richardson, signed legislation which provided laws on how payday lenders should work. The law, which was still considered new by the time it was signed, was considered to be a new hope when it comes to people who utilized loans for any reasons or more commonly known as borrowers. This law was created with an objective- which was to protect consumers from the lenders who went predatory due to the absence of any strong regulations to restrict their mischievous trickeries. This law, according to the former governor, was signed in order to impose tough restrictions on the industry of payday lending service. The bill, which was also considered as a compromise bill, was crafted by a lot of people who were the members of the Administration, Senate, as well as the House after they received support from the Attorney General.
Why did he sign it?
There were some people who asked a question which says that why the former governor signed the bill. Well, the answer to this question is actually pretty simple, you know. The NM governor signs payday lenders bill in 2007 since he did not want his people to suffer from the evil loan lenders. These changes in policies were hoped to able to provide strong and certain protection to the costumers who pursued payday loans. Before the bill was signed, New Mexico was one of the states inside the US which was plagued with unregulated payday loan lenders. Bill Richardson argued that the state had an obligation to protect the borrowers and to take harsh actions against lending practices by protecting them from lending practices which were considered to be unfair.
The contents of the bill
Well, since we have understood the reason why the bill was signed, why don’t we take a look inside the bill itself? In order to understand the bill more, we will need to read the content carefully. Let us check the content, shall we?
The bill, named as House Bill 92, states that renewals and rollover of payday loans are now restricted after the bill was signed. The other prohibition is the requirement of automatic 130-day payment plan for consumers who are unable to repay the loan on time. Besides, the bill also imposes a cooling period which lasts for ten days for an individual to request another payday loan after he/she has received one previously. It also adds new consumer rights signage which is tougher and the loan information needs to be written in Spanish as well. Now, you understand why the NM governor signs payday lenders bill!
Read Also, Why you should not take Payday Loans .