Category Archives: Usury Cap

U.S. District Court Holds that Purchase of Future Settlement Proceeds Violates Kansas Usury Law

A litigation finance firm advanced funds to an individual that was pursuing a personal injury case against a gas can manufacturer. After receiving a series of cash advances, the individual filed suit against the financing firm in U.S. District Court alleging that the … Continue reading

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Citing Madden v. Midland Funding, Colorado Regulator Challenges Bank Partnership Model

The Colorado Administrator of the Uniform Consumer Credit Code (UCCC”) has filed complaints against two UCCC licensees alleging violations of Colorado’s usury cap. Both licensees utilize bank partnerships to originate their loans. Citing Madden v. Midland Funding, the Administrator, represented … Continue reading

Posted in Assignor-Assignee, Attorney General, Colorado, Federal Court, National Bank Act, Preemption, Usury Cap, Usury Exceptions | Comments Off on Citing Madden v. Midland Funding, Colorado Regulator Challenges Bank Partnership Model

Appellate Court Permits Use of Parol Evidence to Support Usury Defense

Two New York debtors entered into a promissory note with a lender in which the lender agreed to lend $35,000 to the debtors and the debtors promised to repay the lender $35,000 plus 15% interest. When the debtors failed to make … Continue reading

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Erroneous Interest Calculation Dooms Criminal Usury Defense – Part II

As previously discussed, the method used to calculate an interest rate is a critical part of any usury action. This was again highlighted in a recent a New York state case. The plaintiff had filed an action to recover on a loan it had … Continue reading

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Iowa Supreme Court Finds NSF Charges Are Not Usurious Under Iowa Consumer Credit Code

A putative class action was filed against a state-chartered Iowa bank. The plaintiffs alleged that the bank had charged them nonsufficient fund (NSF) fees when the plaintiffs used their checking cards to create overdrafts in their checking accounts which the bank … Continue reading

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Creditor Fails to Navigate Usury Law “Minefield”, Ordered to Refund $1.3 Million to Debtor

A recent court decision demonstrates the complexity and dangers faced by creditors attempting to navigate California’s usury laws. In the case, a lender agreed to purchase a debtor’s promissory note from a bank and refinance it for a lower amount. The entity that … Continue reading

Posted in California, Civil Usury, Federal Court, Usury Cap, Usury Exceptions | Comments Off on Creditor Fails to Navigate Usury Law “Minefield”, Ordered to Refund $1.3 Million to Debtor

Court Finds Usurious Late Fees Unenforceable

Though usury caps are only applicable to loan transactions, courts often reference usury rates when determining the reasonableness of fees charged on amounts due. A fee that significantly exceeds the applicable usury rate may be found to be an unenforceable penalty … Continue reading

Posted in Criminal Usury, New York, State Court, Unconscionability, Usury Cap | Comments Off on Court Finds Usurious Late Fees Unenforceable

Blyden v. Navient Corp: A Glimpse of a Post-Madden Future?

A recent US District Court decision out of California offers a rough idea of the usury litigation that may occur if the decision in Madden vs. Midland Funding, LLC ultimately stands. The case centered around the plaintiff’s student loan which had been originated by a national bank. … Continue reading

Posted in Assignor-Assignee, California, Civil Usury, Federal Court, Usury Cap | Comments Off on Blyden v. Navient Corp: A Glimpse of a Post-Madden Future?

36% Usury Cap in New MLA Rules Mirrors Maximum Rate in CFPB’s Proposed Payday Regulations

Yesterday, President Obama announced that the Department of Defense is finalizing new rules under the Military Lending Act. The stated goal of these new regulations is to expand restrictions on certain types of consumer credit offered to US service members, … Continue reading

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Court Makes Short Shrift of Plaintiff’s Attempt to Circumvent Tribal Immunity; Decision at Odds with Criminal Charges recently Brought Against Payday Lender

Bynon v. Mansfield, 2015 U.S. Dist. LEXIS 66684 (E.D. Pa. May 21, 2015) A disgruntled title loan customer filed a usury action against the manager of a title loan company that was organized under tribal law. Plaintiff acknowledged that she could not … Continue reading

Posted in Civil Usury, Pennsylvania, Tribal Immunity, Usury Cap | Comments Off on Court Makes Short Shrift of Plaintiff’s Attempt to Circumvent Tribal Immunity; Decision at Odds with Criminal Charges recently Brought Against Payday Lender