Is anyone aware if Washington State has a statute(s) that governs maximum interest rates and fees that can be charged to consumers on various loan products? I can't seem to find anything specific addressing this issue.

Yes, Washington has usury limits on certain categories of loans; limits depend in part on the type of lender. For some general guidelines, see RCW 19.52. I have a copy of a summary of the guidelines prepared originally by the WA Department of Financial Institutions in 1996. I will fax this to you if you want. (See my profile for information on how to reach me.)

I would love this information, emails to your address on your profile have been returned to me, can you provide perhaps a phone number or alternate email address? Thanks.

Sorry for the delay - I have been out of the office and away from all PCs for the last week. I can be reached at (360) 693-6650.

I made and broker WA RE loans and Mobile Home loans (NOT residential or consumer loans, but business loans only), and although the RCWs are complex on the issue, and seemingly contradictory, I have concluded that if my loans are 12% or less, I'm safe from usury claims...on most any kind of loan.

Sorry, I meant to put in my name on the last posting here, but the system is quicker than I am....hey, what's NOT?

John Merchant,JD,EMS
Tacoma
(253)228-2277

Having spent a considerable time briefing applicable WA State law, it is my conclusion that WA has NO existent, applicable usury laws to true commercial loans.

Although WA courts have written a court decision or two, that a patently phony, alleged "commercial" loan, was really a residential or personal or consumer loan, and as such was in violation of WA usury laws because it bore an interest rate in excess of 12%...if it is truly a commercial loan, made to a corporation or LLC, even though personally guaranteed by that company's officers or owners, it IS exempt and can carry any interest rate agreed by the parties to it.

Further, I think I recall that RCWs clearly state that a legally chartered WA bank is exempt from RCWs.

Isn't that the case?

Not being a chartered bank or employee or officer of one, that law wasn't of immediate concern to me so my memory is hazy.

Washington banks are not exempt from RCW's. However, they can charge interest without regard to the usury limits in RCW 9.52 because of RCW 30.04.025 (pasted in below). Because national banks in some other states (notably Oregon) can charge interest at any rate, this statute gives Washington banks the ability to charge interest at any rate.

RCW 30.04.025
Financial institutions -- Loan charges -- Out-of-state national banks.
Notwithstanding any restrictions, limitations, requirements, or other provisions of law, a financial institution, as defined in RCW 30.22.040(12), may charge, take, receive, or reserve interest, discount or other points, finance charges, or other similar charges on any loan or other extension of credit, at a rate or amount that is equal to, or less than, the maximum rate or amount of interest, discount or other points, finance charges, or other similar charges that national banks located in any other state or states may charge, take, receive, or reserve, under 12 U.S.C. Sec. 85, on loans or other extensions of credit to residents of this state. However, this section does not authorize any subsidiary of a bank, of a trust company, of a mutual savings bank, of a savings and loan association, or of a credit union to charge, take, receive, or reserve interest, discount or other points, finance charges, or other similar charges on any loan or other extension of credit, unless the subsidiary is itself a bank, trust company, mutual savings bank, savings and loan association, or credit union.


[2003 c 24 § 3.]

Initial research indicates that New Hampshire does not have usury laws, in that it does not regulate or cap interest rates. Is this true? If so, where can I find a law or statute for my file?

What constitutes a commcercial loan under washington State law?

1) Any loan to a corp., partnership, Mass. trust, etc. (but notice LLCs aren't included).

2) Any loan that's not for personal, family, or household purposes.

RCW 19.52.080
Defense of usury or maintaining action thereon prohibited if transaction primarily agricultural, commercial, investment, or business -- Exception.
Profit and nonprofit corporations, Massachusetts trusts, associations, trusts, general partnerships, joint ventures, limited partnerships, and governments and governmental subdivisions, agencies, or instrumentalities may not plead the defense of usury nor maintain any action thereon or therefor, and persons may not plead the defense of usury nor maintain any action thereon or therefor if the transaction was primarily for agricultural, commercial, investment, or business purposes: PROVIDED, HOWEVER, That this section shall not apply to a consumer transaction of any amount.

Consumer transactions, as used in this section, shall mean transactions primarily for personal, family, or household purposes.

So to clarify, does or does not Washington State have usury laws? It looks like it's covered first in RCW 19.52.020, credit card agreements excluded in RCW 63.14.165 but then banks in Washington can end up charging whatever they want due to RCW 30.04.025? Is this correct? Help, I am so confused...

You got it. The usury statute limits the rate that can be charged unless there is an exception. Financial institutions are technically not exempt, but the most favored lender "import" provision in RCW 30.04.025 means they can charge any rate, and retail installment and charge agreements are exempt under Ch. 63.14.

There are also exemptions for consumer loan licensees, payday lenders, etc. in the statutes governing those lenders.

wat up doe

I have been researching usuery laws in WA for a while and can not find anything referring to private lending companies offering personal or auto loans. I was wondering if anyone knows where I could find this information (and a good lawyer)

Jennifer
jlknutsen@comcast.net

Per RCW 19.52.020, the limit for non-business loans is either 12% or 26 week T-bill plus 4%, whichever is higher. However, financial institutions are essentially exempt. Also, credit granted under a retail installment contract (i.e., a loan you get through a car dealer) is not subject to the usury limit, per RCW 63.14.130.

You should contact the bar association for the county you're in; they can likely direct you to an attorney who practices in this field.

Try this website.

http://www1.leg.wa.gov/documents/wsr/rates.htm

I am a private party (not company or corp) lending to a private party on a Promsry Note, am I subject to usury laws?

I live in WA State and just secured a loan with HFC for 24%. I now see in WA State the cap is 12%. Is there anything I can do? Or am I stuck????? it has been less then 30 day's????

Unfortuately what HFC did is not usery. I work for a competitor of theirs. Under WA state laws we can charge up to 25% on any personal loans with a max of 4% in additional fees. The cap for Real Estate loans in washington is 8% above prime which is 6.5% right now or 14.5% without having to use Section 32 laws which allow for rates up to the state maximum of 25% with additional disclosure. As long as they did not violate the 25% state max and the 4% loan origination fees they did nothing wrong and you are stuck paying high interest rate unless you can find a bank or credit union that will pay it off for you.