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Debt Collection Laws in New Mexico

Patrick Austin, J.D. | August 01, 2023

Edited by Hannah Locklear

Summary: New Mexico residents have access to a set of legal protections when it comes to interacting and engaging with debt collection agents and agencies. There are both state and federal laws, including the Rosenthal Fair Debt Collection Practices Act and the federal Fair Debt Collection Practices Act, governing how and when debt collectors can communicate and more. SoloSuit can help you stand up for your rights against debt collectors and settle debt in New Mexico.

Residents in the Land of Enchantment have access to certain legal rights and protections when it comes to the conduct and actions of debt collectors in their pursuits to collect on a delinquent account. The rights afforded to New Mexico residents are described in the federal Fair Debt Collection Practices Act (FDCPA) and the New Mexico Fair Debt Collection Practices Act (NMFDCPA). Let’s take a look at each law.

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Federal law protects you from unfair debt collection

The Fair Debt Collection Practices Act (FDCPA) is a seminal federal law passed by Congress in the 1970s. The federal FDCPA was drafted with the intention of protecting consumers from unfair, deceptive and inappropriate debt collection practices. For example, the FDCPA restricts debt collectors from using abusive, unfair and/or harassing tactics when engaging with a consumer and attempting to collect on a delinquent account.

The FDCPA also prohibits debt collectors from doing the following:

  • Calling consumers before 8:00 a.m. or after 9:00 p.m.
  • Contacting your friends and neighbors about a debt
  • Contacting your employer about a debt
  • Using threatening, obscene and offensive language while communicating with consumers

The FDCPA requires debt collectors to disclose certain information about the delinquent account, upon request from a consumer. This is known as debt validation, and if a consumer requests such validation, a debt collector needs to respond within five days. The debt validation notice must contain specific pieces of information, including:

  • The specific amount owed.
  • The name of the creditor, or creditors, to whom the debt is allegedly owed.
  • What steps a consumer is able to take if you have reason to believe it is not your debt.

If a debt collector is found to be in violation of the FDCPA, a consumer also has the right to file a legal action to pursue monetary damages and other forms of restitution. Make a debt collector validate your debt by sending a Debt Validation Letter.

To learn more about how the FDCPA protects you, check out our guide on What Debt Collectors Cannot Do — FDCPA Explained.

NMFDCPA provides state-level debt collection protection to New Mexico residents

In addition to the federal FDCPA, New Mexico has its own debt collection law, the New Mexico Fair Debt Collection Practices Act (NMFDCPA). This state law essentially mirrors the protections afforded under the federal FDCPA. It is designed to protect consumers from unfair and deceptive debt collection practices. For example, the NMFDCPA expressly prohibits the following actions by debt collectors:

  • Pretending to be an attorney
  • Threatening to take legal action that they cannot, or do not plan to, take
  • Threaten to arrest for nonpayment of a debt
  • Pretend to be associated with any government or law enforcement agencies
  • Falsely represent the debt or themselves in any way

The NMFDCPA also outlines remedies that consumers can seek if they are a victim of FDCPA violations, including:

  • Any actual damage sustained by the debtor as a result the violation;
  • Additional damages as the court may allow, but not exceeding $1,000; and,
  • Court costs and attorney’s fees.

Keep reading to learn more about how to report FDCPA violations and seek remedies in New Mexico.

Dispute debt collection attempts in New Mexico

Under New Mexico law, individuals possess the legal right to challenge and contest debt collection efforts. Specifically, if an individual believes the debt is inaccurate, they have the legal right to dispute the collection efforts. Please be aware that challenging a debt collection attempt must be done in writing.

Once an individual formally contests the debt collection attempts, the debt collection agent, or agency, is obligated to respond to the objection by conducting a formal investigation. If the debt collector is unable to verify and validate the debt, they are legally required to immediately halt their collection efforts.

Respond to being sued by a debt collector in New Mexico

Depending on your situation, there is the possibility you may be subjected to a lawsuit filed by the debt collector. However, the debt collector is required to take specific steps when filing a lawsuit concerning an unpaid debt, including:

  • Properly serving you with a Summons and Complaint
  • The Complaint must contain sufficient information identifying you, the debt, and your purported obligation to repay the debt

Once you receive the Summons and Complaint, you can respond with an Answer. If you respond to the debt collector’s lawsuit, then the case will be set for trial and pre-trial matters will commence, including discovery, settlement conferences, motions for summary judgment, and so forth. Alternatively, the debt collector may dismiss the case if you deny their claims and they realize such claims are faulty and won’t stand before a judge.

The New Mexico statute of limitations on debt also protects you

When it comes to debt collection efforts, there is a specific amount of time a debt collection agent, or agency, is allotted to try and recover on the debt. This is known as the statute of limitations. It is a specific period of time frame in which a debt collector or creditor can attempt to hold you accountable for an alleged debt. New Mexico, much like other states, has different periods within its statutes of limitations that range from four to ten years depending on the type of debt.

Once the statute of limitations lapses, the debt is effectively time-barred and the creditor will not be able to try and recover repayment through a lawsuit.

Even though the statute of limitations may have passed on the debt, it is important to be aware that many debt collectors might continue to contact you about the debt and even pursue a lawsuit. As a result, it is important for you to proactively assert the statute of limitations as an affirmative defense, if it applies to your situation.

The table below outlines the statute of limitations on different types of debt in New Mexico:

Statute of Limitations on Debt in New Mexico

Debt Type Deadline
Credit Card 6 years
Medical 6 years
Auto Loan 6 years
Student Loan 6 years
Mortgage 6 years
Personal Loan 6 years
Judgment 14 years
N.M. Stat. § 37-1-2 and § 37-1-3

Settle your debt in New Mexico

The surest way to get debt collectors off your back is by paying what you owe. But if you go about this wisely, you can usually settle your debt for a steep discount.

In a debt settlement, you offer your creditor a portion of the total amount due, usually at least 60% of the debt’s value. In exchange for a lump-sum payment, the creditor agrees to drop its legal claims against you and release you from the remaining balance.

If you decide to settle your obligation, you’ll want to ensure you get the terms of your agreement in writing and pay the creditor before your court date. If you’ve never tried debt settlement before, consider working with a professional organization that will guide you through the process.

To learn more about how to settle a debt in New Mexico, check out this video:

SoloSettle, powered by SoloSuit, is a tech-based approach to debt settlement. Our software helps you send and receive settlement offers until you reach an agreement with the collector. Once an agreement is reached, we’ll help you manage the settlement documentation and transfer your payment to the creditor or debt collector, helping you keep your financial information private and secure.

Read also: How to Settle a Debt in New Mexico

Key takeaways

Debt collection laws in New Mexico were enacted with the goal of keeping consumers safe from abusive, predatory and inappropriate debt collection practices. These laws, including the federal and state FDCPA, help even the proverbial playing field and make it easier for consumers to defend themselves in and out of court against overly aggressive debt collection agencies. Here are some key takeaways from this article on New Mexico debt collection laws:

  • The FDCPA prohibits debt collectors from using abusive and harassing tactics, contacting consumers outside specific hours, and disclosing certain information about the debt upon request.
  • New Mexico's NMFDCPA provides similar protections, including remedies for FDCPA violations, such as damages and attorney's fees.
  • Individuals in New Mexico have the right to challenge and contest debt collection attempts if they believe the debt is inaccurate, and debt collectors are required to respond with a formal investigation.
  • New Mexico has statutes of limitations on debt collection, after which debt collectors cannot attempt legal action for the unpaid debt.
  • SoloSettle can assist you in settling your debts in New Mexico, which can help you avoid wage garnishment and going to court.

Hopefully this article has helped you learn more about your consumers rights under the FDCPA and New Mexico laws. And remember: if you’ve been sued for a debt in New Mexico, SoloSuit can help you respond to the lawsuit and stand up for your rights in court.

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