what are usury laws 
usury is lending money at an interest rate that is unreasonably high or higher than the rate permitted by law usury laws protect consumers by governing the interest charged on a loan in the united states individual states are responsible for setting usury laws though this type of financial activity could fall under the constitution s commerce clause congress has not traditionally focused on usury at the federal level examples of usury laws by statecredit card companies charge interest rates that are allowed by the state where the company was incorporated rather than follow the usury laws that apply in the states where borrowers live nationally chartered banks similarly can apply the highest interest allowed by the state where the institution was incorporated delaware and south dakota may be chosen as the states of incorporation for many financial institutions because of the freedom allowed regarding interest rates similarly nevada has no usury limits pennsylvania considers interest above 25 as criminal usury new jersey s general usury limit is 30 for individuals and 50 for corporations 1in 2023 the consumer financial protection board and the new york attorney general sued credit acceptance corporation for misrepresenting the cost of credit and tricking customers into high cost loans on used cars 2legislationthe effectiveness of usury laws is often debated after decisions by the u s supreme court and legislation gave financial institutions the capacity to circumvent limits the high court s decision in the case of marquette national bank v first of omaha corp allowed credit companies to charge customers out of state at the same interest rates the companies could charge in the states where they were incorporated 3delaware s introduction of the financial center development act which eliminated limits in the state on fees and interest that can be charged on consumer lending further amplified the desire among financial institutions to move there 4in 2023 u s senators sheldon whitehouse jack reed elizabeth warren bernie sanders and jeff merkley introduced the empowering states rights to protect consumers act to restore states ability to limit consumer loan interest rates and help address the billions of dollars that consumers hold in loans and credit card debt 5