Massachusetts Laws

curlycarl Posted: 14 apr 2006 21:00 Post subject:

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So can a lender charge whatever they wish? Is there any way consumer can seek protection against sky high interest rate?

PART IV. CRIMES, PUNISHMENTS AND PROCEEDINGS IN CRIMINAL CASES


TITLE I. CRIMES AND PUNISHMENTS


CHAPTER 271. CRIMES AGAINST PUBLIC POLICY


Chapter 271: Section 49. Criminal usury


Section 49. (a) Whoever in exchange for either a loan of money or other property knowingly contracts for, charges, takes or receives, directly or indirectly, interest and expenses the aggregate of which exceeds an amount greater than twenty per centum per annum upon the sum loaned or the equivalent rate for a longer or shorter period, shall be guilty of criminal usury and shall be punished by imprisonment in the state prison for not more than ten years or by a fine of not more than ten thousand dollars, or by both such fine and imprisonment. For the purposes of this section the amount to be paid upon any loan for interest or expenses shall include all sums paid or to be paid by or on behalf of the borrower for interest, brokerage, recording fees, commissions, services, extension of loan, forbearance to enforce payment, and all other sums charged against or paid or to be paid by the borrower for making or securing directly or indirectly the loan, and shall include all such sums when paid by or on behalf of or charged against the borrower for or on account of making or securing the loan, directly or indirectly, to or by any person, other than the lender, if such payment or charge was known to the lender at the time of making the loan, or might have been ascertained by reasonable inquiry.

(b) Whoever, with knowledge of the contents thereof, possesses any writing, paper, instrument or article used to record a transaction proscribed under the provisions of paragraph (a) shall be punished by imprisonment in a jail or house of correction for not more than two and one half years, or by a fine of not more than five thousand dollars, or by both such fine and imprisonment.

(c) Any loan at a rate of interest proscribed under the provisions of paragraph (a) may be declared void by the supreme judicial or superior court in equity upon petition by the person to whom the loan was made.

(d) The provisions of paragraph (a) to (c), inclusive, shall not apply to any person who notifies the attorney general of his intent to engage in a transaction or transactions which, but for the provisions of this paragraph, would be proscribed under the provisions of paragraph (a) providing any such person maintains records of any such transaction. Such notification shall be valid for a two year period and shall contain the person's name and accurate address. No lender shall publicly advertise the fact of such notification nor use the fact of such notification to solicit business, except that such notification may be revealed to an individual upon his inquiry. Illegal use of such notification shall be punished by a fine of one thousand dollars. Such records shall contain the name and address of the borrower, the amount borrowed, the interest and expenses to be paid by the borrower, the date the loan is made and the date or dates on which any payment is due. Any such records shall be made available to the attorney general for the purposes of inspection upon his request. Such records and their contents shall be confidential but may be used by the attorney general, or any district attorney with the approval of the attorney general, for the purposes of conducting any criminal proceeding to which such records or their contents are relevant.

(e) The provisions of this section shall not apply to any loan the rate of interest for which is regulated under any other provision of general or special law or regulations promulgated thereunder or to any lender subject to control, regulation or examination by any state or federal regulatory agency.

PART I. ADMINISTRATION OF THE GOVERNMENT


TITLE XX. PUBLIC SAFETY AND GOOD ORDER


CHAPTER 140. LICENSES


LOANS


Chapter 140: Section 106. Illegal interest; order of commissioner; recovery in action or suit; costs


Section 106. If a greater rate of interest or amount for expenses than is allowed under sections ninety-six to one hundred and eleven, inclusive, has been paid on any loan to which said sections apply, the person who paid it may file a complaint with the commissioner, who may, after a hearing, order such excess amounts refunded, or may make such other order as he may deem necessary. The filing of the complaint and the decision of the commissioner shall not affect the right of the complainant under section one hundred and three, who may, in an action of contract or suit in equity, recover back the amount of the unlawful interest or expenses, with twice the legal costs, if such action or suit is brought within two years after the time of payment.

NEW YORK
Licensed lender law applies but interest rate is that agreed to by contract. N.Y. Banking Law ?? 340 et seq. A check
casher licensee cannot make loans nor cash or advance any moneys on a post dated check unless it is a payroll
check. N.Y. Banking Law ?? 373. Criminal law sets the usury cap at 25%. N.Y. Penal Code ?? 190.40

NEW JERSEY
Consumer loan act applies but rates as agreed to by contract. N.J. Stat. Ann. tit. 17,?? 1 et seq. However,
criminal law sets the usury cap at 30%. N.J. Stat. Ann. ?? 2C: 21-19. A check cashing licensee cannot cash or
advance money on a postdated check. N.J. Stat. Ann. ?? 17:15A-47.

WEST VIRGINIA
None. Small loan act applies. W. Va. Code ?? 46A-4-107 (31% per year on a loan of $2,000 or less). Check
cashers are specifically prohibited from making payday loans. If a person has violated these provisions, the maker
has a cause of action to recover from that person the amount of the check, plus a civil penalty of between $100
and $1,000. W. Va. Code ?? 32A-3-1 et seq.

VERMONT
None. Small loan act applies. Vt. Stat. Ann. tit. 9 ?? 41a. (18% per year).

PENNSYLVANIA
None. Check cashers are specifically prohibited from making payday loans under Check Cashing Licensing Act of
1998, ?? 505(a). Otherwise, consumer discount company act applies. 7 Pa. Cons. Stat. Ann. ?? 6201 et seq. ($9.50
per $100 per year).

MARYLAND
None. Consumer loan act applies. Md. Code Ann. Com. Law II ?? 12-301 et seq. (2.75% per month).