National Usury Act

Summary

National Usury Act - Establishes the legal rate of interest at a semiannual declining scale of between 15 and ten percent per year. Provides that, except with respect to loans of less than $2,500 made by petty loan companies or credit unions: (1) any agreement to charge interest in excess of ten percent per year on a loan of more than $300 is void as to the excess interest which may be recovered by the borrower; and (2) any partial payment on a debt must be first applied to the interest due. Prohibits the defense of usury in any debt recovery action. States that insurance premiums required to be paid under a secured loan agreement shall not exceed those required under similar nonloan policies. Sets forth provisions governing the application of the legal rate of interest to judgments. Requires persons engaged in the business of financing loans on personal property sold by dealers to purchasers on credit to pay interest at five percent per year on any reserve withheld from the dealer under the contract for financing. Makes such amount due immediately upon the close of the loan account. Requires that dealers receive biannual reserve accounts reports. Establishes a fine for dealer financing violations. Requires the board of directors of any institution which deals in bills of exchange to fix and make public the exchange rates. Prohibits officers of these institutions from deviating from such rates. Sets forth provisions governing secured and unsecured installment loans given by banks, trust companies, and combined banks and trust companies.

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1 official file

• Introduced in House

  summary · EN · 23 September 1981

  Open at official source

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