Utah Usury Laws

The State of Utah has developed a rather complicated system for establishing interest rates on loans and on other financing arrangements in the state. Through this article, you will be provided with an overview of some of the important lending restrictions that are in place in Utah at this point in time.

Utah has developed a fairly diffuse scheme when it comes to legally permissible interest rates that can be utilized. With that understood, the general, legal rate of interest in Utah for consumer transactions is 10%.

When it comes to personal, consumer loans in Utah, the interest rate needs to be kept under the 10% level in order to meet muster with existing statutory provisions. While there is no reference to usury caps per se within the law, personal loans that contain interest rates above the 10% level will be suspect.

If the interest rate on a personal loan is substantially above the 10% level, courts in the State of Utah more often than not will completely strike the loan agreement down as void and unenforceable. Such a personal loan agreement will be considered an illegal loan.

If the deviation from the 10% is not so significant, chances are that a court in Utah actually will enforce the general provisions of the loan agreement. However, the court will lower the interest rate contained within the loan agreement to a level within the range of 10% or below.

When it comes to other types of consumer transactions, the permissible interest rates are, in fact, floating rates. They can change very suddenly. Therefore, it is imperative for you to make certain that you have fully educated yourself on the prevailing interest rate that is legally permissible in Utah for a particular type of consumer transaction.

The statutory provisions governing interest rates, lending practices and related issues can be found codified at Utah Code Titles 07, 12, 13, 70A and 70C.

Nothing in this article should be construed as providing you legal advice. If you have any specific questions or concerns after reading this article, you should consult with an attorney. Additionally, we do take all reasonable steps necessary to keep the information and materials up to date and accurate. However, the statutes governing loans and interest rates in Utah do change from time to time.

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