Usury Rate

Usury Rate

The highest, legal interest rate on a financial instrument in a jurisdiction. In 1978, the U.S. Supreme Court held that a company may charge up to the usury rate in the state in which it is registered, regardless of where the borrower lives. As a result, many American credit card companies are registered in South Dakota, which has loose restrictions.
References in periodicals archive ?
Federal law currently does not specify a federal usury rate, other than in limited circumstances where, for example, loans that are made at grossly excessive rates of interest can result in criminal liability, (11) or where certain types of loans are made to military servicemembers or their families.
One effort tried to cap the state's states usury rate at 500 percent, but no one [in the legislature] would touch it.
115) These measures are not meant as a substitute for the imposition of usury rate caps.
Arizona's Proposition 200 reapplied the state's usury rate cap to payday lenders, who had previously enjoyed an exemption.
In her testimony, Fox urged subcommittee members to back an alternative measure, the Protecting Consumers from Unreasonable Credit Rates Act of 2009, which would establish a national usury rate cap of 36 percent.
As a result of the Federal Reserve's actions, the new maximum rate usury rate in Arkansas is 5.
The usury law constrains the bank's ability to set the inflation rate to maximize the amount of loans, but if the usury rate is greater than the real rate of interest this does not affect the bank's ability to earn the rate `[pi]' on its loans.
The trust documents define the maximum rate for taxable bonds as the lesser of the auction rate for that period, the maximum auction rate, 15%, and the usury rate.
3d 1038 (2002), however, said he found language in a law predating the NBA's enactment in 1864 that shows that the usury rate action can be filed only in federal court.
37) Accordingly, states began competitively reducing individual usury rates in order to maintain in-state lending institutions, a race that resulted in the deregulation of the lending market.
If the bill had reached the floor, a heated floor fight would likely have resulted over whether to pass the measure, which effectively would eliminate so-called payday and title loan lenders--businesses that suddenly flooded the state after 1999, when New Hampshire became the only one in northern New England to lift usury rates.