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What does usury mean?
I've heard about it when looking into loans for a new car. What is the purpose of it?
Emily Maracle · Updated on
Reviewed by Shannon Martin, Licensed Insurance Agent.
“The definition of usury is: the illegal action or practice of lending money at unreasonably high rates of interest. Most states have usury laws or regulations.
To avoid predatory lending practices, usury laws set limits on the amounts interest that certain lenders or companies can charge. While not every lender is required to follow usury laws, it can help people identify high interest rates.
For example, in Illinois, interest rates can’t exceed 9% in a written contract, although numerous exceptions exist. Consumers can also agree to rates above the usury law, which happens more often than you’d think.
Since you’re looking into car loans, find out what the usury rate is in your state and find out what companies are required to follow usury regulations. Shopping for
car loan
rates or getting preapproval is also a benefit, as you can see what competitive rates are.If you’re shopping for full coverage car insurance, the
Jerry
app can provide you with dozens of quotes in under a minute to make your search easier.”View full answer
- Gregory R.
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