46th legislature - STATE OF NEW MEXICO - first session, 2003

RELATING TO TRADE PRACTICES; ENACTING A NEW SECTION OF THE UNFAIR PRACTICES ACT TO CLARIFY MISLEADING EXTENSION OF CREDIT.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

Section 1. A new section of the Unfair Practices Act is enacted to read:

"[NEW MATERIAL] PRE-APPROVED LOAN CHECKS--MISLEADING EXTENSION OF CREDIT.--

A. Extending pre-approved credit with a blank check without adequate notification that it is a loan constitutes a misleading extension of credit and is an unfair and deceptive trade practice. A clear and prominent notice, including an explanation of interest due and the other terms of the credit, accompanying an extension of pre-approved credit is not a misleading extension of credit.

B. As used in this section, "adequate notification" means the printing of the word "loan" in large, contrasting color letters on the front of the blank check instrument."