What are the limits on interest rates? Print E-mail
Written by Kerry S. Doolittle   
Friday, 09 April 2010

Georgia law places certain limits on the amount or rate of interest that may be charged by a lender in various circumstances.  Exceeding those limits is a crime called "usury" (which is even found in the old testament.  Many statutes, like the Motor Vehicle Sales Finance Act, impose limits in specific circumstances.  A few exemptions apply, such as the special rules for pawn shops which allow them to charge very high rates.  Where no specific statute applies, a generally applicable statute applies.

Where the principal amount of a debt is $3,000.00 or less, the maximum permitted interest rate is 16% per year simple interest. O.C.G.A. 7-4-2(a)(2).

 Where the principal amount of a debt is more than $3,000.00, the parties may set any interest rate up to the legal maximum. O.C.G.A. 7-4-2(a)(1)(A) and (B).

 The maximum permitted interest rate is 5% per month, and exceeding that rate constitutes a misdemeanor. 


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