New Mexico Debt Consolidation
Debt Help in New Mexico
Debt is never something we intend to struggle with. It usually comes on slowly, with a few purchases here and there that end up totaling far more than we intended. Sometimes it occurs because of unexpected bills. Regardless of the reason you face debt, you may be able to find help with the various programs offered by the state of New Mexico.
New Mexico Credit Counseling and Debt Consolidation
As you work your way out of debt, when you find that you’ve reached a point that you simply cannot dig yourself out from, it may be time to look for help. Your first stop should be a New Mexico credit counseling firm. These companies work to help debtors understand their debt, where their debt problems come from, and the options they have to work through it. Often they offer support with budgeting needs, and can even help you work out a repayment plan that pays off your debt faster.
Finding a credit counseling firm that works well with your needs and desires can be a challenge. One place to start your search is with the Justice Department. The Justice Department maintains a list of credit counselors approved to work with their bankruptcy cases. You can choose your counseling agency from this list. Having federal approval means these companies have agreed to comply with some regulations. You can find this list at http://www.justice.gov.
Another option you may wish to consider, whether or not you are working with a credit counselor, is debt consolidation. This plan only works if you are disciplined enough to stop using your credit cards once you consolidate, but debt consolidation can help you save money by lumping all of your debts into one loan product, which usually has a lower interest rate than what you are paying.
New Mexico Debt Relief Programs
Many companies operate in New Mexico as “debt relief” companies. These companies offer services similar to credit counselors, but often they go further by actually negotiating with creditors on a consumer’s behalf. This can often turn into a debt settlement or better terms, but be careful. Sometimes these companies charge high up front fees, but leave you with the impression that the money you are paying is going to pay your creditors. Make sure you know exactly what any money you send to a debt relief program is going toward.
New Mexico Debt Collection Laws
New Mexico does not have many state debt collection laws. Rather, debt collectors in the state must abide by the laws outlined in the Fair Debt Collection Practices Act (FDCPA). Under these laws, debt collectors cannot:
• Communicate information about the debt with third party individuals. The only reason they can contact third parties is to request contact information for the individual.
• Communicate by post card.
• State to others that an individual owes a debt.
• Communicate with third parties more than once, unless the third party has requested that they do so.
• Send written communication that shows by markings on the envelope that it pertains to a past-due debt.
• Call before 8:00 a.m. or after 9:00 p.m.
• Use profane or obscene language.
• Threaten physical harm or embarrassment.
• Threaten to sell the debt to coerce payment.
• Falsely represent information about the debt or the account.
You can stop the actions of a debt collector at any time. Simply write to the collection agency, explaining that you do not wish to be contacted again. After receiving the letter, the collection agency can only write to you to tell you they will stop contacting you and to tell you of changes to your account. You will still be responsible for the debt, however.
Also, the state sets a maximum interest rate that debt collectors can charge for their services. That rate is 15 percent. This is one of the highest in the nation.
If your creditors wish to garnish your wages, state laws protect the greater of 75 percent of your disposable weekly earnings or 40 times the federal minimum wage. Your creditors also have the right to sue you. If they choose to do so, they must begin the process in the timeframe set forth in the state’s statute of limitations legislation. The statute of limitations for various forms of debt in New Mexico is:
• Oral agreements – Four years
• Written contracts – Six years
• Promissory notes – Six years
• Open accounts (credit cards) – Four years
Keep in mind that the laws in the FDCPA do not apply to your creditors, just the debt collectors.
New Mexico Mortgage Assistance
The New Mexico Finance Authority has several programs to assist homebuyers in getting an affordable mortgage that fits their needs. The Mortgage$aver program offers a below-market rate with the potential for closing cost assistance to first-time homebuyers, which the state defines as individuals who have not owned a home in the last three years. These include programs like FHA loans, which work well for people with low credit ratings or little to put down on the home, VA loans and the MyCommunity and Community Solutions loans. To learn more about these options, visit http://www.housingnm.org.
The MFA also offers four mortgage down payment assistance programs. The Helping Hands program is designed for low-income families with a member who has an ADA disability. Buyers can borrow up to $8,000 at 0 percent interest to use as a down payment. The Mortgage Booster program is an assistance plan for those using the Mortgage$aver program. The program offers down payment assistance through a second mortgage. The Payment$saver Program is a soft second loan, usually at starting 0 percent, for up to 8 percent of the sales price or $8,000, whichever is less. Income guidelines dictate which consumers qualify for these various assistance programs. To learn more about these and other down payment assistance options, visit http://www.housingnm.org.
If you face foreclosure in your near future, look into the information provided through the Making Home Affordable program, found at http://www.housingnm.org. You may be able to take steps to protect your home, if you begin working now.
New Mexico Debt Assistance Programs
New Mexico offers a variety of public aid programs, which may free up money for low-income individuals to use to pay back their debt. The state does not have any other state specific assistance programs relating to debt.