Usury Laws

What are 'Usury Laws'

Usury laws are regulations governing the amount of interest that can be charged on a loan. Usury laws specifically target the practice of charging excessively high rates on loans by setting caps on the maximum amount of interest that can be levied. These laws are designed to protect consumers.

BREAKING DOWN 'Usury Laws'

In the United States, individual states are responsible for setting their own usury laws. Though this type of financial activity could fall under the Constitution's commerce clause, Congress hasn't traditionally focused on usury. The government does consider the collection of usury through violent means a federal offense.

RELATED TERMS
  1. Usury Rate

    A rate of interest that is usually considerably above current ...
  2. Usury

    The act of lending money at an interest rate that is considered ...
  3. Legal Rate Of Interest

    The highest rate of interest that can be legally charged on any ...
  4. Financial Responsibility Law

    A law which requires an individual to prove that he or she is ...
  5. Maritime Law

    A body of laws, conventions and treaties that governs international ...
  6. Natural Law

    A set of rules inherent in human behavior and human reasoning ...
Related Articles
  1. Options & Futures

    Payday Loans Don't Pay

    Hold too tightly to this rescue line and you'll soon be drowning in debt.
  2. Economics

    Law Of Diminishing Marginal Utility

    Learn about this law of economics related to consumption.
  3. Investing News

    EU Privacy Laws May Pinch Big Tech's Profits

    Will the EU's new privacy laws cut into the data harvesting that has been Big Tech's bread and butter for a decade?
  4. Professionals

    Career Advice: Investment Banking Vs. Law

    Learn some of the most important differences between a career in investment banking and law, and figure out which career suits you better.
  5. Professionals

    Career Advice: Accounting Vs. Law

    Identify the key differences between working in accounting and working in law. Understand which specific skills make you better-suited for each career.
  6. Options & Futures

    Different Needs, Different Loans

    Find out what options are available when it comes to borrowing money.
  7. Credit & Loans

    Unsecured Personal Loans: 8 Sneaky Traps

    If you are seeking a personal loan, be aware of these pitfalls before you proceed.
  8. Economics

    Understanding Term Loans

    A loan from a bank for a specific amount that has a specified repayment schedule and a floating interest rate.
  9. Investing Basics

    How Banks Set Interest Rates On Your Loans

    On the face of it, figuring out how a bank makes money is a pretty straightforward affair. A bank earns a spread on the money it lends out from the money it takes in as a deposit. The net interest ...
  10. Credit & Loans

    All About Government Loans

    There are many reasons to seek a government loan rather than one from a private lender. Government loans typically have low interest rates and offer fixed or subsidized options, as well as deferred ...
RELATED FAQS
  1. Why are credit cards able to charge such high interest rates compared to other lenders?

    A true financial horror story began on Halloween in 1978. On that date, the Supreme Court began hearing Marquette National ... Read Answer >>
  2. Is a person registered for Financial Instruments Business eligible to conduct both ...

    Explore Japan's 2006 Financial Instruments and Exchange Law, and understand how the law affects investment services regulation. Read Answer >>
  3. In what states are high-cost payday loans illegal?

    Learn which states permit high-interest payday loans. Explore the maximum rates permitted to be charged on a state-by-state ... Read Answer >>
  4. How can I use the correlation coefficient to predict returns in the stock market?

    Read about simple interest loans, how they function, and some of the loan products or contracts that are most likely to carry ... Read Answer >>
  5. What does the law say about non-U.S. citizens buying stocks of U.S. companies? Are ...

    The law is very fuzzy on the matter of who may own U.S. securities and for what purpose. The U.S. follows the common law ... Read Answer >>
  6. What are the basic requirements to qualify for a payday loan?

    Find out the basic requirements to apply and qualify for a payday loan and understand the factors that determine when and ... Read Answer >>
Hot Definitions
  1. Over-The-Counter - OTC

    Over-The-Counter (or OTC) is a security traded in some context other than on a formal exchange such as the NYSE, TSX, AMEX, ...
  2. Quarter - Q1, Q2, Q3, Q4

    A three-month period on a financial calendar that acts as a basis for the reporting of earnings and the paying of dividends.
  3. Weighted Average Cost Of Capital - WACC

    Weighted average cost of capital (WACC) is a calculation of a firm's cost of capital in which each category of capital is ...
  4. Basis Point (BPS)

    A unit that is equal to 1/100th of 1%, and is used to denote the change in a financial instrument. The basis point is commonly ...
  5. Sharing Economy

    An economic model in which individuals are able to borrow or rent assets owned by someone else.
  6. Unlevered Beta

    A type of metric that compares the risk of an unlevered company to the risk of the market. The unlevered beta is the beta ...
Trading Center