All New Mexicans should be able to meet their basic needs, regardless of their debt status. Over 40% of New Mexicans have debt in collections and thousands file for bankruptcy annually. New Mexico law protects minimal income in wage garnishment, and essential property, like a home and vehicle, in bankruptcy. But unfortunately, the value of protected property has not been updated in decades, if at all. In just the last year, inflation reached a 40 year high of 9% and the average cost of a home in New Mexico increased over 18%. The outdated law prevents families from recovering from debt and hurts our local economies.

A bill to modernize New Mexico’s bankruptcy and debt collection laws is currently making its way through the legislature, and will be heard in its first committee tomorrow afternoon.

SB 216, sponsored by Sen. O’Neill & Rep. Chasey, would protect families with debt by:

• Increasing the value of property that are protected from collections in bankruptcy and wage garnishment and adjusts property values to increase with inflation. This would:
• Prevent creditors from taking so much of the family’s wages that the they are pushed to below minimum wage;
• Allow the family to keep a used car of at least average value;
• Preserve the family’s home;
• Preserve a basic amount in a bank account so that the family can still afford essentials such as rent, utilities, and commuting expenses;
• Prevent seizure and sale of the family’s necessary household goods.
• Require that families with debt are instantly made aware of when someone tries to garnish their wages.

We need your help. Speak out at the Senate Health and Public Affairs Committee hearing Friday, February 10, at 1:30pm (or a half hour after the Senate Floor session ends) and submit public comments asking legislators to fully pass SB 216 to let New Mexico families with debt have a fair chance at a fresh start!

Make your voice heard!

Join us in person at the New Mexico State Capitol Building, 490 Old Santa Fe Trail, Santa Fe, NM 87501, Room 311. You can also join via zoom: https://us02web.zoom.us/j/9124526531 or via telephone: +1 253-215-8782, webinar ID:912 452 6531.

Tips for public comment:

The sponsors will introduce SB 216 into discussion and the Chair will ask who is in support. At that time, raise your hand. The Chair will usually allow 1-2 minutes per comment. Please state your name, where you’re from, that you support the bill, and why it’s important to protect New Mexico families who file for bankruptcy or have debt in collections.

Things you can highlight in your public comment:

• A personal story or experience with debt collection or bankruptcy.
• Updating our debt collection laws would prevent homelessness and increase opportunity for New Mexicans by protecting the value of a home, and allowing a family to retain the value of other critical property in bankruptcy like a vehicle and equipment needed for a job.
• Protecting income from garnishment helps families and our local economies by ensuring that working New Mexicans have enough to live and that more earnings are spent in our local communities rather than going to debt collectors.
• SB 216 brings New Mexico in line with neighboring states like Arizona, Colorado, Nevada, and Texas, who have all updated the value of property that is protected from collections.
• Improving the notices debt collectors send helps families, as well as employers and financial institutions understand their obligations in debt collection cases.
• The NM House of Representatives passed this bill with strong bipartisan support in 2021, but the bill ran out of time in the Senate.