Maine Usury Laws
The usury laws in the State of Maine have been developed in order to protect consumers when they take out certain types of personal loans. These laws are designed to prevent a consumer who obtains a personal loan from being subjected to an unconscionable rate of interest.
The statutes and regulations in the State of Maine do not have specific usury provisions on the books. However, the legal rate of interest in Maine is set at six percent on most types of consumer loans.
In the case of interest rates on judgments, there is a two tier system in the state. For judgments below $30,000, the interest rate is 15%. On the other hand, for judgments above $30,000, the interest rate is set at the 52 week average discount rate for T-bills plus an additional 4%.
Generally speaking, the statutes governing interest rates on personal loans in Maine can be found codified at Maine Revised Statutes Title 9-A.
When it comes to other types of loans, there different statutory provisions that govern the appropriate interest rate that can be charged on these loans. For example, when it comes to state chartered banks, savings and loans, and credit unions in Maine, there are separate statutory provisions that govern the rate of interest that these financial institutions can charge.
Additionally, when it comes to financing for the purchase of goods over $500, the provisions of the Uniform Commercial Code as adopted by the State of Maine govern the applicable and legal rates of interest.
When it comes to personal loan agreements in Maine that might be construed to contain “excessive interest” rates, courts in the state of Maine will reformat those agreements to make the interest rates “reasonable.” In other words, if a court in Maine is confronted with a loan agreement (a personal loan agreement) that calls for an interest rate about the six percent level, rather than strike down the loan agreement in its entirety, a typical court in the state will refashion the agreement to lower the interest rate downwards to the six percent level.
Because there are no usury provisions per se in the State of Maine when it comes to personal loans, there are not any specific penalties for charging an interest rate above the six percent level in many instances. However, if a person persists in lending to other individuals and charges interest above the six percent level, there can be some sanctions available if the practice appears to amount to loan sharking.
Finally, keep in mind that while we do make every effort to keep the information in this article up to date, the statutes and regulations governing interest rates on personal loans in Maine do change from time to time. Moreover, nothing in this article should be construed as providing legal advice or assistance to a reader. The materials in this article are presented for informational purposes only. If you have any questions about the issues raised in this article, you should seek professional legal assistance.