Definition - What does Usury mean?

Usury is when a lender charges interest on a loan that is higher than the maximum amount allowed by law. Usury is a criminal offense. Maximum interest amounts are set by states. So, lenders who commit usury by charging higher than these amounts can face criminal charges and punitive legal consequences, if found guilty.

Justipedia explains Usury

When a borrower takes out a loan, he or she does so with the understanding that the interest rate will remain at the rate set in the loan contract. So, if a lender starts charging the borrower a higher rate of interest as time goes on, this can be illegal. For example, if a credit card interest rate is 15%, and the credit card company suddenly starts charging an amount over the state's limit for interest rates, then this would be usury.

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