Georgia Usury Laws

Georgia has established a two tier system (by most accounts) when it comes to usury laws in that state. (As will be discussed in a moment, there is some controversy involving the usury law in Georgia at the present time that is yet to be fully and completely resolved.)

There is no dispute (generally speaking) that the usury limit on personal loans that are below $3,000 currently is set at 16% in Georgia. This represents a higher end usury limitations, a higher limitation than is found in many states in the country at this point in time. Again, there is general agreement regarding this particular provision of the usury law in Georgia.

On loans of $3,000 or more, the usury limitation appears (yes, appears) to be set at 5% per month. (Keep in mind that the law does appear to establish a monthly usury rate of 5% on loans over $3,000. Of course, on a very basic level, this rate has the potential of translating to a significant rate of 60% per annum.)

As mentioned, there is controversy in Georgia over exactly what the usury laws in that state provide. That controversy surrounds the 5% per month usury rate on loans over $3,000. This provision of the Georgia law is being challenged. Moreover, there are some strong arguments being made that lawmakers in the Peach State could not possibly have intended a usury limitation of 5% per month which arguably can translate to a usury limitation at 60% per annum. Many people argue that a 60% usury limitation is no limitation at all. Again, the whole structure of usury laws and provisions is being debated at this time. (Indeed, some people are even arguing that the “per month” language included in the Georgia statute governing usury laws was intended to read “per annum.”)

Beyond these provisions, Georgia law also requires that loans below $250,000 include simple interest that is fully set forth in writing. Compound interest rates in such loans simply are not permitted at this time under Georgia law.

The information presented in this article is not intended to give to you legal advice. The materials in this article are for informational purposes only. In addition, if you have any questions in regard to usury laws in Georgia, you should contact a lawyer. Finally, while we make ever effort to keep the information in this article up to date, Georgia law in regard to usury limitations and lending practices are in flux. Therefore, you will want to keep abreast of the changes that are occurring in Georgia in regard to usury laws and limitations at this time.

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