Best Personal Loans in New Mexico for 2024

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Reviewed byAlvin Yam, CFP
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Updated: April 11, 2024

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When rating personal loan lenders in New Mexico, MoneyGeek focused on lender reputation, transparency and interest rates. First Tech came out on top of our analysis, scoring 97 out of 100. A competitive APR range and reputable customer service make this lender stand out. Following close behind is PenFed, with a MoneyGeek score of 96. It is known for consumer education and overall lender reputation.

If you are a New Mexico borrower with a credit score near 702, you'll likely have more favorable loan options. When applying for a personal loan, lenders also consider your income history and debt-to-income ratio.

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UNDERSTAND YOUR DEBT-TO-INCOME RATIO

Your monthly debt payments relative to your monthly gross income are called your debt-to-income ratio or DTI.

Most lenders prefer a debt-to-income ratio of 35% to 40% or below for secured loans and 40% to 45% or below for unsecured personal loans. A debt-to-income ratio above 50% is considered high, so approval may be more difficult, or your loan may have higher interest rates.

Alvin Yam, CFP®

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Calculate Your Monthly Loan Payment

Explore your loan options with our personal loan calculator. This simple tool calculates monthly payments and total loan costs based on amount, interest rate and term length, helping you make informed decisions before committing.

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IS INTEREST ON PERSONAL LOANS TAX DEDUCTIBLE?

Interest on personal loans is generally not tax deductible, as personal loans are considered consumer debt. But there are some exceptions where the interest may qualify:

  • When consolidating high-interest qualifying debts like credit cards or student loans, if used to pay off those debts.
  • If used for home improvements that increase the home's value.
  • If the loan proceeds can be demonstrated as used exclusively for business expenses or starting a business.
  • In some cases, if the loan is used for investment purposes related to income-generating assets.

Alvin Yam, CFP®

Impact of Credit Score on Loan Repayment in New Mexico

When considering a personal loan in New Mexico, you should review your credit score, income and debt-to-income ratio — key factors that lenders evaluate to determine your creditworthiness. If you are a New Mexican seeking a personal loan, improving your credit score before a loan application could help you secure more favorable loan terms.

Refer to the accompanying table to see how different credit scores can affect your monthly loan payments.

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This table approximates monthly payments, calculated using median personal loan interest rates typical for various credit score ranges. Please remember that these numbers are median estimates provided for general guidance. They should not be taken as precise rates for everyone in each credit score category. Actual interest rates differ due to lender-specific policies, prevailing market conditions and unique borrower profiles.

Pros and Cons of Personal Loans in New Mexico

Personal loans in New Mexico offer advantages like lower interest rates, the flexibility to consolidate various debts into one manageable payment, and the versatility of a solution for numerous financial scenarios. Despite these merits, there are potential downsides, such as origination fees and the risk of collateral loss in secured loans.

For a comprehensive understanding, you should review the pros and cons of personal loans.

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FAQ About Personal Loans in New Mexico

If you have questions about personal loans, MoneyGeek has answers to help you make an informed decision before applying.

According to MoneyGeek's analysis, First Tech is the best lender for personal loans in New Mexico with a MoneyGeek score of 97. The average APR is approximately 12%.

In New Mexico, personal loans can be obtained from online lenders, banks and credit unions. For those preferring in-person services, local credit unions like First Financial Credit Union, Nusenda Credit Union and Del Norte Credit Union offer personal loans.

The lender offering the lowest APR in New Mexico is PenFed, with rates starting as low as 7.99% according to MoneyGeek's analysis. Remember that the best rates are typically available to those with excellent credit scores, and the best option depends on your specific needs and financial circumstances.

In New Mexico, you can use personal loans for a variety of purposes, such as for medical expenses, vacation or travel, and home or auto repair. Generally, personal loans cannot be used for college tuition or gambling.

When considering personal loans, it's essential to be wary of red flags such as high APRs, strict repayment penalties, a lack of transparency about the lender's insurance status and poor consumer reviews.

Yes, lenders evaluate your income level when you apply for a personal loan, but that's not all. They scrutinize your debt-to-income ratio, credit score, employment history, type of employment and credit history. Opening new credit lines during the application process might affect your chances of securing a loan.

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The content on this page is accurate as of the posting/last updated date; however, some of the rates mentioned may have changed. We recommend visiting the lender's website for the most up-to-date information available.

Editorial Disclosure: Opinions, reviews, analyses and recommendations are the author’s alone and have not been reviewed, endorsed or approved by any bank, lender or other entity. Learn more about our editorial policies and expert editorial team.